Elanco Animal Health (ELAN) 10-Q 9 May 23 2023 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2023	May 04, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Transition Report	false
Entity File Number	001-38661
Entity Registrant Name	Elanco Animal Health Inc
Entity Incorporation, State or Country Code	IN
Entity Tax Identification Number	82-5497352
Entity Address, Address Line One	2500 INNOVATION WAY
Entity Address, City or Town	GREENFIELD
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	46140
City Area Code	877
Local Phone Number	352-6261
Title of 12(b) Security	Common stock, no par value
Trading Symbol	ELAN
Security Exchange Name	NYSE
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
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		492,550,481
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001739104
Current Fiscal Year End Date	--12-31

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Statement [Abstract]
Revenue	$ 1,257	$ 1,226
Costs, expenses and other:
Cost of sales	494	509
Research and development	81	81
Marketing, selling and administrative	327	323
Amortization of intangible assets	134	137
Asset impairment, restructuring and other special charges	40	40
Interest expense, net of capitalized interest	64	52
Other expense, net	9	9
Costs, expenses and other	1,149	1,151
Income before income taxes	108	75
Income tax expense	5	24
Net income	$ 103	$ 51
Earnings per share:
Basic (usd per share)	$ 0.21	$ 0.10
Diluted (usd per share)	$ 0.21	$ 0.10
Weighted average shares outstanding:
Basic (in shares)	491.1	488
Diluted (in shares)	492.8	492.2

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 103	$ 51
Other comprehensive income (loss):
Cash flow hedges, net of taxes	(48)	109
Foreign currency translation	130	(85)
Defined benefit pension and retiree health benefit plans, net of taxes	0	(1)
Other comprehensive income, net of taxes	82	23
Comprehensive income	$ 185	$ 74

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Current Assets
Cash and cash equivalents	$ 318	$ 345
Accounts receivable, net of allowances of $15 (2023) and $13 (2022)	1,051	797
Other receivables	213	205
Inventories	1,596	1,538
Prepaid expenses and other	370	394
Total current assets	3,548	3,279
Noncurrent Assets
Goodwill	6,061	5,993
Other intangibles, net	4,791	4,842
Other noncurrent assets	369	378
Property and equipment, net of accumulated depreciation of $744 (2023) and $723 (2022)	1,000	999
Total assets	15,769	15,491
Current Liabilities
Accounts payable	381	390
Employee compensation	110	146
Sales rebates and discounts	329	324
Current portion of long-term debt	381	388
Other current liabilities	377	454
Total current liabilities	1,578	1,702
Noncurrent Liabilities
Long-term debt	5,639	5,448
Accrued retirement benefits	164	161
Deferred taxes	663	662
Other noncurrent liabilities	245	229
Total liabilities	8,289	8,202
Commitments and Contingencies
Equity
Preferred stock, no par value, 1,000,000,000 shares authorized; none issued	0	0
Common stock, no par value, 5,000,000,000 shares authorized, 492,418,216 and 474,237,738 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively	0	0
Additional paid-in capital	8,744	8,738
Accumulated deficit	(954)	(1,057)
Accumulated other comprehensive loss	(310)	(392)
Total equity	7,480	7,289
Total liabilities and equity	$ 15,769	$ 15,491

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Accounts receivable, net of allowances	$ 15	$ 13
Property and equipment, net of accumulated depreciation	$ 744	$ 723
Preferred stock, shares authorized (in shares)	1,000,000,000	1,000,000,000
Preferred stock, shares issued (in shares)	0	0
Common stock, shares authorized (in shares)	5,000,000,000	5,000,000,000
Common stock, shares issued (in shares)	492,418,216	474,237,738
Common stock, shares outstanding (in shares)	492,418,216	474,237,738

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Equity (Unaudited) - USD ($) $ in Millions	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss	Cash Flow Hedge	Foreign Currency Translation	Defined Benefit Pension and Retiree Health Benefit Plans
Balance at beginning of period (in shares) at Dec. 31, 2021		473,100,000
Balance at beginning of period at Dec. 31, 2021	$ 7,508	$ 0	$ 8,696	$ (979)	$ (209)	$ 25	$ (253)	$ 19
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	51			51
Other comprehensive income (loss), net of tax	23				23	109	(85)	(1)
Stock-based compensation	14		14
Issuance of stock under employee stock plans, net (in shares)		1,000,000
Issuance of stock under employee stock plans, net	(11)		(11)
Balance at end of period (in shares) at Mar. 31, 2022		474,100,000
Balance at end of period at Mar. 31, 2022	$ 7,585	$ 0	8,699	(928)	(186)	134	(338)	18
Balance at beginning of period (in shares) at Dec. 31, 2022	474,237,738	474,200,000
Balance at beginning of period at Dec. 31, 2022	$ 7,289	$ 0	8,738	(1,057)	(392)	182	(672)	98
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	103			103
Other comprehensive income (loss), net of tax	82				82	(48)	130
Stock-based compensation	11		11
Issuance of stock under employee stock plans, net (in shares)		900,000
Issuance of stock under employee stock plans, net	(6)		(6)
Issuance of stock under employee stock plans, net (in shares)		100,000
Issuance of stock under employee stock plans, net	$ 1		1
Conversion of tangible equity units (TEUs) into common stock (in shares)		17,200,000
Balance at end of period (in shares) at Mar. 31, 2023	492,418,216	492,400,000
Balance at end of period at Mar. 31, 2023	$ 7,480	$ 0	$ 8,744	$ (954)	$ (310)	$ 134	$ (542)	$ 98

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash Flows from Operating Activities
Net income	$ 103	$ 51
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation and amortization	173	176
Deferred income taxes	2	(7)
Stock-based compensation expense	12	14
Asset impairment and write-down charges	0	22
Loss on sale of assets	1	1
Inventory fair value step-up amortization	1	0
Changes in operating assets and liabilities, net of acquisitions	(439)	(332)
Other non-cash operating activities, net	2	13
Net Cash Used for Operating Activities	(145)	(62)
Cash Flows from Investing Activities
Net purchases of property and equipment	(20)	(19)
Cash paid for acquisitions	(16)	0
Purchases of intangible assets	(14)	0
Purchases of software	(4)	(7)
Other investing activities, net	(1)	(3)
Net Cash Used for Investing Activities	(55)	(29)
Cash Flows from Financing Activities
Proceeds from revolving credit facility	200	63
Repayments of long-term borrowings	(19)	(89)
Repayments of revolving credit facility	0	(163)
Other financing activities, net	(7)	(11)
Net Cash Provided by (Used for) Financing Activities	174	(200)
Effect of exchange rate changes on cash and cash equivalents	(1)	(5)
Net decrease in cash and cash equivalents	(27)	(296)
Cash and cash equivalents at January 1	345	638
Cash and cash equivalents at March 31	$ 318	$ 342

Background

Background	3 Months Ended
	Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Background	Note 1. Background Elanco is a global animal health company that innovates, develops, manufactures and markets products for pets and farm animals. We offer a portfolio of approximately 200 brands to pet owners, veterinarians and farm animal producers in more than 90 countries. Our products are generally sold worldwide directly to wholesalers, distributors and independent retailers. Certain products are also sold directly to farm animal producers and veterinarians. We have a diversified business of products across species consisting of: dogs and cats (collectively, pet health) and cattle, poultry, swine and aqua (collectively, farm animal).

Basis of Presentation and Summa

Basis of Presentation and Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Summary of Significant Accounting Policies	Note 2. Basis of Presentation and Summary of Significant Accounting Policies We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the SEC requirements for interim reporting. As permitted under those rules, certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the U.S. (GAAP) have been condensed or omitted. The information included in this Form 10-Q should be read in conjunction with our consolidated financial statements and accompanying notes for the year ended December 31, 2022 included in our 2022 Form 10-K . In addition, results for interim periods should not be considered indicative of results for any other interim period or for the full year ending December 31, 2023 or any other future period. In our opinion, the financial statements reflect all adjustments (including those that are normal and recurring) that are necessary for fair presentation of the results of operations for the periods shown. In preparing financial statements in conformity with GAAP, we must make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures at the date of the financial statements and during the reporting period. Actual results could differ from those estimates. Certain reclassifications of prior year information have been made to conform to the current year's presentation. The significant accounting policies set forth in Note 4 to the consolidated financial statements in our 2022 Form 10-K appropriately represent, in all material respects, the current status of our accounting policies. Revision of Previously Issued Consolidated Financial Statements In connection with the preparation of our financial statements as of and for the year ended December 31, 2022, a cumulative error was identified and corrected relating to the valuation allowance for taxes for a Southeast Asia affiliate. While immaterial to prior years, correcting this cumulative error in 2022 would have caused the 2022 financial statements to be materially misstated. In conjunction with making these corrections, we made other adjustments to the prior years to revise uncorrected errors. The appropriate revisions to our historical condensed consolidated financial statements and the notes thereto are reflected herein. Further information is included in Note 2 and Note 21 to the consolidated financial statements in our 2022 Form 10-K .

Implementation of New Financial

Implementation of New Financial Accounting Pronouncements	3 Months Ended
	Mar. 31, 2023
Accounting Changes and Error Corrections [Abstract]
Implementation of New Financial Accounting Pronouncements	Note 3. Implementation of New Financial Accounting Pronouncements The following table provides a brief description of an accounting standard that was recently adopted: Standard Description Effective Date Effect on the Financial Statements or Other Significant Matters ASU 2020-04, Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting; ASU 2021-01, Reference Rate Reform (Topic 848): Scope; ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. ASU 2021-01 clarifies the scope of Topic 848 so that derivatives affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions. ASU 2022-06 extends the period of time entities can utilize the reference rate reform relief guidance under ASU 2020-04 from December 31, 2022 to December 31, 2024. Adoption of the guidance is optional and effective as of March 12, 2020 through December 31, 2024. Adoption is permitted at any time during the period on a prospective basis. Effective April 1, 2023, and in accordance with the provisions outlined in our underlying credit agreements, we have transitioned the reference rate used in our credit facilities from the London Interbank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (Term SOFR). The change did not have a material impact on our condensed consolidated financial statements.

Revenue

Revenue	3 Months Ended
	Mar. 31, 2023
Revenue from Contract with Customer [Abstract]
Revenue	Note 4. Revenue Our sales rebates and discounts are based on specific agreements. The most significant of our sales rebate and discount programs in terms of accrual and payment amounts, percentage of our products that are sold via these programs and level of judgment required in estimating the appropriate transaction price, relate to our programs in the U.S., France and the United Kingdom (U.K.). As of March 31, 2023 and 2022, the aggregate liability for sales rebates and discounts for these countries represented approximately 76% and 74%, respectively, of our total liability. The following table summarizes the activity in our global sales rebates and discounts liability: Three Months Ended March 31, 2023 2022 Beginning balance $ 324 $ 319 Reduction of revenue 209 219 Payments (204) (241) Ending balance $ 329 $ 297 Adjustments to revenue recognized as a result of changes in estimates for the judgments described above during the three months ended March 31, 2023 and 2022 for product shipped in previous periods were not material. Actual global product returns were less than 1% of net revenue for the three months ended March 31, 2023 and 2022. Disaggregation of Revenue The following table summarizes our revenue disaggregated by product category: Three Months Ended March 31, 2023 2022 Pet Health $ 675 $ 640 Farm Animal: Cattle 248 247 Poultry 183 180 Swine 102 99 Aqua 40 43 Total Farm Animal 573 569 Contract Manufacturing (1) 9 17 Revenue $ 1,257 $ 1,226

Acquisitions, Divestitures and

Acquisitions, Divestitures and Other Arrangements	3 Months Ended
	Mar. 31, 2023
Business Combination and Asset Acquisition [Abstract]
Acquisitions, Divestitures and Other Arrangements	Note 5. Acquisitions, Divestitures and Other Arrangements NutriQuest U.S. Acquisition On January 3, 2023, we acquired certain U.S. marketed products, pipeline products, inventory and an assembled workforce from NutriQuest, LLC (NutriQuest). NutriQuest is a provider of swine, poultry and cattle nutritional health products to animal producers. The acquisition allows us to expand our existing nutritional health offerings and furthers our efforts to explore innovative antibiotic alternatives. The composition of the purchase price is as follows: Up-front cash consideration $ 16 Deferred cash consideration due January 4, 2024 5 Fair value of contingent consideration 35 Total purchase consideration $ 56 Contingent consideration includes up to $85 million of cash consideration payable if specific development, sales and geographic expansion milestones are achieved. We recorded a $35 million liability on the condensed consolidated balance sheet as of the acquisition date based on the fair value of the contingent consideration. See Note 10: Financial Instruments and Fair Value for further information. The transaction was accounted for as a business combination under the acquisition method of accounting. The acquisition method requires, among other things, that assets acquired and liabilities assumed in a business combination be recognized at their fair values as of the acquisition date. The determination of estimated fair value requires management to make significant estimates and assumptions. The excess of the purchase price over the fair value of the acquired assets has been recorded as goodwill. The results of operations of the acquisition are included in our condensed consolidated financial statements from the date of acquisition. Revenue and income from NutriQuest included in our condensed consolidated statements of operations for the three months ended March 31, 2023 were immaterial. The following table summarizes the preliminary amounts recognized for assets acquired as of the acquisition date: Estimated Fair Value at January 3, 2023 Inventory $ 3 Intangible assets: Marketed products 28 Acquired in-process research and development (IPR&D) 9 Other intangible assets 15 Total identifiable assets 55 Goodwill (1) 1 Total consideration transferred $ 56 (1) The goodwill recognized from this acquisition is primarily attributable to NutriQuest's assembled workforce and expected synergies. The goodwill associated with this acquisition is deductible for tax purposes. Other intangible assets consist of customer relationships and trade names. The acquired definite-lived intangible assets are being amortized over a weighted-average estimated useful life of approximately 12 years on a straight-line basis. The estimated fair values of identifiable intangible assets were determined using the income approach, which is a valuation technique that provides an estimate of the fair value of an asset based on market participant expectations of the cash flows an asset would generate over its remaining useful life. Some of the significant assumptions inherent in the development of these asset valuations include the estimated net cash flows for each year for each asset or product (including revenues, cost of sales, R&D expenses, marketing, selling and administrative expenses and contributory asset charges), the appropriate discount rate necessary to measure the risk inherent in each future cash flow stream, the life cycle of each asset, the potential regulatory and commercial success risk and competitive trends impacting the asset and each cash flow stream, as well as other factors. The accounting for this acquisition has not been finalized as of March 31, 2023. The purchase price allocation is preliminary and subject to change, including the valuation of the contingent consideration and intangible assets. The final determination of these amounts will be completed as soon as possible but no later than one year from the acquisition date. Pending Acquisition NutriQuest Brazil On January 22, 2023, we entered into an asset purchase agreement to acquire inventory and distribution rights for certain marketed products and certain other assets of NutriQuest Nutricao Animal Ltda (NutriQuest Brazil). Pursuant to the terms and conditions set forth in the asset purchase agreement, total consideration is $24 million to be paid in two installments, subject to certain post-closing adjustments. The transaction is expected to close within the next six months. We anticipate that this transaction will be accounted for as a business combination under the acquisition method of accounting. Divestitures Microbiome R&D platform carve-out In April 2022, we signed an agreement to transfer assets associated with our microbiome R&D platform to a newly created, independent biopharmaceutical company, BiomEdit, focused on developing solutions for animal and human health. As part of the agreement, we retained a non-voting, minority stake in the company. In addition, we entered into transitional services agreements with the company for certain services. Assets transferred included intellectual property and laboratory equipment. The book values of those assets were not material. We recorded a gain on disposal of the assets of approximately $3 million during the year ended December 31, 2022. We determined that the disposal of the related net assets does not qualify for reporting as a discontinued operation because it does not represent a strategic shift that has or will have a major effect on our operations and financial results. During the three months ended March 31, 2023, we recorded an immaterial gain in other expense, net in our condensed consolidated statements of operations in connection with the sale of additional equity by BiomEdit. Shawnee and Speke During 2021, as part of our strategy to optimize our manufacturing footprint, we announced an agreement with TriRx Pharmaceuticals (TriRx) to sell our manufacturing sites in Shawnee, Kansas (Shawnee) and Speke, U.K. (Speke), including the transfer of approximately 600 employees. In connection with these arrangements, we also entered into long-term manufacturing and supply agreements, under which TriRx began manufacturing existing Elanco products at both sites upon the closing of the transactions. On August 1, 2021 and February 1, 2022, we completed the sales of our Shawnee and Speke sites, respectively. Upon closing the sale of the Speke site, we recorded a contract asset of $55 million for the favorable supply agreement, which is included in prepaid expenses and other and other noncurrent assets on our condensed consolidated balance sheets. Our fair value assessment for the favorable supply agreement was estimated using a combined income and market approach which incorporated Level 3 inputs. The divestitures did not represent a strategic shift that has or will have a major effect on our operations and financial results, and therefore do not qualify for reporting as discontinued operations. See Note 6: Asset Impairment, Restructuring and Other Special Charges for further information. Based on the terms of the agreements, we expect to receive aggregate gross cash proceeds of $78 million from the sales of Shawnee and Speke over a period of three years which began in the second half of 2022. Through March 31, 2023, we have received cash proceeds totaling $13 million. In May 2023, we entered into amendments to the agreements which effectively restructured the payment schedule related to the remaining amount owed. Under the terms of the amendments, we expect to receive the remaining cash proceeds upon the earlier of the date on which certain conditions are met or in equal installments over a twelve-month period beginning January 31, 2024. At this time, we believe amounts owed by TriRx are collectible and we will continue to assess collectibility. Further, we have rights to certain collateral in the event of a default and we continue to monitor the value of this collateral. BexCaFe Arrangement In June 2022, we signed a license agreement with BexCaFe, LLC (BexCaFe) for the development and commercialization of products related to Bexacat, an oral treatment intended to reduce glucose levels in diabetic cats. BexCaFe held the rights to the compound through a license agreement with similar terms and conditions. We will incur all development and regulatory costs associated with the products. Based on the guidance in Accounting Standards Codification (ASC) 810, Consolidation , we determined that BexCaFe represents a variable interest entity and that we are the primary beneficiary of BexCaFe because the terms of the license give us the power to direct the activities that most significantly impact the entity’s economic performance. As a result, we consolidated BexCaFe, a development-stage company with no employees that did not meet the definition of a business, as of the date we signed the license agreement. Upon initial consolidation of BexCaFe, we measured an IPR&D asset at its fair value of $59 million and recorded liabilities totaling $59 million, which included contingent consideration of $49 million based on the fair value of estimated future milestone payments and sales royalties owed under the license agreement. The initial fair value of the contingent payments was calculated based on an income approach, with payments adjusted for probability of success and then discounted to a present value. There is no minimum payout due on the contingent consideration and the maximum payout related to sales royalties is unlimited. Since BexCaFe did not meet the definition of a business, no goodwill was recorded and immediately after initial consolidation, we expensed the IPR&D asset because we concluded that it did not have an alternative future use. During the three months ended March 31, 2023, we paid $13 million to BexCaFe in connection with development/regulatory milestones achieved upon U.S. FDA approval of the original new animal drug application for Bexacat in December 2022. Remaining contingent consideration liabilities of $36 million are included in other current liabilities and other noncurrent liabilities on our condensed consolidated balance sheet as of March 31, 2023. Subsequent to the effective date of the license agreement, our consolidated financial statements include the assets, liabilities, operating results and cash flows of BexCaFe. Based on the guidance in ASC 810, income and expense between us and BexCaFe have been eliminated against the income or expense included in the financial statements of BexCaFe. The resulting amounts after the effect of these eliminations were included in our condensed consolidated financial statements for the three months ended March 31, 2023 and were not material.

Asset Impairment, Restructuring

Asset Impairment, Restructuring and Other Special Charges	3 Months Ended
	Mar. 31, 2023
Restructuring and Related Activities [Abstract]
Asset Impairment, Restructuring and Other Special Charges	Note 6. Asset Impairment, Restructuring and Other Special Charges In recent years, we have incurred substantial costs associated with restructuring programs and cost-reduction initiatives designed to achieve a flexible and competitive cost structure. As discussed further below, restructuring activities primarily include charges associated with facility rationalization and workforce reductions. In connection with our recent acquisitions, including the acquisition of Bayer Animal Health, we have also incurred costs associated with executing transactions and integrating acquired operations, which may include expenditures for banking, legal, accounting and other similar services. In addition, we have incurred costs to stand up our organization as an independent company. All operating functions can be impacted by these actions; therefore, non-cash expenses associated with our tangible and intangible assets can be incurred as a result of revised fair value projections and/or determinations to no longer utilize certain assets in the business on an ongoing basis. For finite-lived intangible assets and other long-lived assets, whenever impairment indicators are present, we calculate the undiscounted value of projected cash flows associated with the asset, or group of assets, and compare it to the carrying amount. If the carrying amount is greater, we record an impairment loss for the excess of book value over fair value. Determinations of fair value can result from a complex series of judgments and rely on estimates and assumptions. See Note 2: Basis of Presentation and Summary of Significant Accounting Policies for discussion regarding estimates and assumptions. Components of asset impairment, restructuring and other special charges are as follows: Three Months Ended March 31, 2023 2022 Restructuring charges (credits): Severance and other costs (1) $ — $ (7) Facility exit costs — 1 Acquisition related charges: Transaction and integration costs (2) 40 24 Non-cash and other items: Asset write-down (3) — 22 Total expense $ 40 $ 40 (1) 2022 credits primarily relate to adjustments resulting from the reversal of severance accruals associated with 2021 restructuring programs resulting from final negotiations and certain restructured employees filling open positions. (2) Transaction costs represent external costs directly related to acquiring businesses and primarily include expenditures for banking, legal, accounting and other similar services. Integration costs represent internal and external incremental costs directly related to integrating acquired businesses, including the acquisition of Bayer Animal Health (e.g., expenditures for consulting, system and process integration and product transfers), as well as independent company stand-up costs related to the implementation of new systems, programs and processes. (3) 2022 includes the finalization of the write-down charge upon the final sale of the Speke site. See Note 5: Acquisitions, Divestitures and Other Arrangements for further discussion. The following table summarizes the activity in our reserves established in connection with restructuring activities: Severance Balance at December 31, 2021 $ 126 Reserve adjustments (7) Cash paid (42) Foreign currency translation adjustments (1) Balance at March 31, 2022 $ 76 Balance at December 31, 2022 $ 36 Cash paid (24) Foreign currency translation adjustments — Balance at March 31, 2023 $ 12

Inventories

Inventories	3 Months Ended
	Mar. 31, 2023
Inventory Disclosure [Abstract]
Inventories	Note 7. Inventories We state all inventories at the lower of cost or net realizable value. We use the last-in, first-out (LIFO) method for a portion of our inventories located in the continental U.S. Other inventories are valued by the first-in, first-out (FIFO) method or the weighted average cost method. Inventories consisted of the following: March 31, 2023 December 31, 2022 Finished products $ 749 $ 725 Work in process 605 605 Raw materials and supplies 299 266 Total 1,653 1,596 Decrease to LIFO cost (57) (58) Inventories $ 1,596 $ 1,538

Equity

Equity	3 Months Ended
	Mar. 31, 2023
Equity [Abstract]
Equity	Note 8. Equity Tangible Equity Unit (TEU) Offering In January 2020, we issued 11 million in TEUs at the stated amount of $50 per unit. Total proceeds, net of issuance costs, were $528 million. The gross proceeds and deferred finance costs from the issuance of the TEUs were allocated 86% to equity (prepaid stock purchase contracts) and 14% to debt (TEU amortizing notes) based on the relative fair value of the respective components of each TEU. See Note 9: Debt for additional information on the TEU amortizing notes.

Debt

Debt	3 Months Ended
	Mar. 31, 2023
Debt Disclosure [Abstract]
Debt	Note 9. Debt Long-term debt consisted of the following: March 31, 2023 December 31, 2022 Incremental Term Facility due 2025 $ 175 $ 175 Incremental Term Facility due 2028 492 494 Incremental Term Facility due 2029 249 249 Term Loan B due 2027 3,870 3,881 Revolving Credit Facility (1) 200 — 4.272% Senior Notes due 2023 344 344 4.900% Senior Notes due 2028 750 750 TEU Amortizing Notes due 2023 (2) — 7 Unamortized debt issuance costs (60) (64) 6,020 5,836 Less current portion of long-term debt 381 388 Total long-term debt $ 5,639 $ 5,448 (1) During the three months ended March 31, 2023, we drew on our revolving credit facility to fund working capital needs. (2) The TEU amortizing notes matured on February 1, 2023. We were in compliance with all of our debt covenants as of March 31, 2023.

Financial Instruments and Fair

Financial Instruments and Fair Value	3 Months Ended
	Mar. 31, 2023
Fair Value Disclosures [Abstract]
Financial Instruments and Fair Value	Note 10. Financial Instruments and Fair Value Financial instruments that are potentially subject to credit risk consist principally of trade receivables. We evaluate the creditworthiness of our customers on a regular basis, monitor economic conditions and calculate allowances for estimated credit losses on our trade receivables on a quarterly basis using an expected credit loss model. We assess whether collectability is probable at the time of sale and on an ongoing basis. Collateral is generally not required. The risk associated with this concentration is mitigated by our ongoing credit-review procedures. A large portion of our cash is held by a few major financial institutions. We monitor the exposure with these institutions and do not expect any of these institutions to fail to meet their obligations. All highly liquid investments with a maturity of three months or less from the date of purchase are considered to be cash equivalents. The cost of these investments approximates fair value. We had investments without readily determinable fair values and equity method investments included in other noncurrent assets on our condensed consolidated balance sheets totaling $27 million as of March 31, 2023 and December 31, 2022 . Unrealized net gains and losses on our investments for the three months ended March 31, 2023 and 2022 were immaterial. The following table summarizes the fair value information at March 31, 2023 and December 31, 2022 for foreign exchange contract assets (liabilities), investments, contingent consideration liabilities and cash flow hedge assets (liabilities) measured at fair value on a recurring basis in the respective balance sheet line items, as well as long-term debt (including TEU amortizing notes) for which fair value is disclosed on a recurring basis: Fair Value Measurements Using Financial statement line item Carrying Quoted Prices in Active Markets for Identical Assets Significant Significant Fair March 31, 2023 Prepaid expenses and other - foreign exchange contracts not designated as hedging instruments $ 28 $ — $ 28 $ — $ 28 Prepaid expense and other - forward-starting interest rate contracts designated as cash flow hedges 8 — 8 — 8 Other noncurrent assets - forward-starting interest rate contracts designated as cash flow hedges 3 — 3 3 Other noncurrent assets - investments 6 6 — — 6 Other current liabilities - foreign exchange contracts not designated as hedging instruments (25) — (25) — (25) Other current liabilities - contingent consideration (23) — — (23) (23) Other noncurrent liabilities - contingent consideration (12) — — (12) (12) Other noncurrent liabilities - forward-starting interest rate contracts designated as cash flow hedges (9) — (9) — (9) Long-term debt, including current portion (6,080) — (5,891) — (5,891) December 31, 2022 Prepaid expenses and other - foreign exchange contracts not designated as hedging instruments $ 76 $ — $ 76 $ — $ 76 Prepaid expenses and other - forward-starting interest rate contracts designated as cash flow hedges 14 — 14 — 14 Other noncurrent assets - forward-starting interest rate contracts designated as cash flow hedges 10 — 10 — 10 Other noncurrent assets - investments 7 7 — — 7 Other current liabilities - foreign exchange contracts not designated as hedging instruments (64) — (64) — (64) Long-term debt, including current portion (5,900) — (5,711) — (5,711) We determine our Level 2 fair value measurements based on a market approach using quoted market values or significant other observable inputs for identical or comparable assets or liabilities. Contingent consideration liabilities totaling $35 million as of March 31, 2023 related to contingent consideration associated with our acquisition of certain assets of NutriQuest during the first quarter of 2023. We may pay up to $85 million in cash consideration which is contingent upon the achievement of specified sales, approval and geographic expansion milestones as outlined in the asset purchase agreement. The fair values of the contingent consideration liabilities were estimated using the Monte Carlo simulation model and a probability weighted expected return method. Both methods use significant inputs that are not observable in the market, representing Level 3 inputs, including those relating to revenue forecasts, discount rates, and volatility. See Note 5: Acquisitions, Divestitures and Other Arrangements for further discussion. Derivative Instruments and Hedging Activities We are exposed to market risks, such as changes in foreign currency exchange rates and interest rates. To manage the volatility related to these exposures, we have entered into various derivative transactions. We formally assess, designate and document, as a hedge of an underlying exposure, each qualifying derivative instrument that will be accounted for as an accounting hedge at inception. Additionally, we assess, both at inception and at least quarterly thereafter, whether the financial instruments used in the hedging transaction are effective at offsetting changes in either the fair values or cash flows of the underlying exposures. Derivative cash flows, with the exception of net investment hedges, are principally classified in the operating activities section of the condensed consolidated statements of cash flows, consistent with the underlying hedged item. Cash flows related to net investment hedges are classified in the investing activities section of the consolidated statements of cash flows. Further, we do not offset derivative assets and liabilities on the condensed consolidated balance sheets. Our outstanding positions are discussed below. Derivatives not designated as hedges We may enter into foreign exchange forward or option contracts to reduce the effect of fluctuating currency exchange rates. These derivative financial instruments primarily offset exposures in the Euro, British pound, Swiss franc, Brazilian real, Australian dollar, Japanese yen, Canadian dollar and Chinese yuan. Foreign currency derivatives used for hedging are put in place using the same or like currencies and duration as the underlying exposures and are recorded at fair value with the gain or loss recognized in other expense, net in the condensed consolidated statements of operations. Forward contracts generally have maturities not exceeding 12 months. As of March 31, 2023 and December 31, 2022, we had outstanding foreign exchange contracts with aggregate notional amounts of $912 million and $784 million, respectively. The amount of net gains (losses) on derivative instruments not designated as hedging instruments, recorded in other expense, net were as follows: Three Months Ended March 31, 2023 2022 Foreign exchange forward contracts (1) $ 2 $ (8) (1) These amounts were substantially offset in other expense, net by the effect of changing exchange rates on the underlying foreign currency exposures. Derivatives designated as hedges We are subject to interest rate risk with regard to our existing floating-rate debt, and we utilize interest rate swap contracts to mitigate the variability in cash flows by effectively converting the floating-rate debt into fixed-rate debt. We recognize any differences between the variable interest rate payments and the fixed interest rate settlements with the swap counterparties as an adjustment to interest expense, net of capitalized interest over the life of the swaps. We have designated our interest rate swaps as cash flow hedges and record them at fair value on the condensed consolidated balance sheets. Changes in the fair value of the hedges are recognized in other comprehensive income (loss). Fair value is estimated based on quoted market values of similar hedges and is classified as Level 2. Our outstanding forward-starting interest rate swaps have maturities ranging between 2023 and 2025 with aggregate notional amounts of $3,050 million as of March 31, 2023 and December 31, 2022. In March 2023, we entered into new interest rate swap agreements with a combined notional amount of $1,000 million, which become effective on October 1, 2023 following the maturity of certain current swaps with the same combined notional amount. The transaction effectively extends the maturity from 2023 to 2025 and will result in a change of the weighted average fixed rate from 4.4% to 4.1% on the effective date. The amounts of net gains (losses) on cash flow hedges recorded, net of tax, in other comprehensive income, are as follows: Three Months Ended March 31, 2023 2022 Forward-starting interest rate swaps $ (48) $ 109 During the three months ended March 31, 2023 and 2022, activity on cash flow hedges recorded in other comprehensive income included losses of $21 million and gains of $109 million, respectively, related to mark-to-market adjustments. There was no tax effect for the three months ended March 31, 2023 and 2022 after the application of the U.S. valuation allowance. See Note 11: Income Taxes for further discussion. In April 2022 and September 2022, we took advantage of market opportunities to restructure our interest rate swap portfolio. We unwound the existing swaps and simultaneously entered into new agreements with the same notional amounts and covering the same tenors. As a result, we received cash settlements of $132 million and $75 million in the respective periods. These gains were initially recognized in accumulated other comprehensive loss and are reclassified to interest expense, net of capitalized interest over the period during which the related interest payments are made. During the three months ended March 31, 2023, we reclassified $27 million of gains relating to our terminated interest rate swaps from accumulated other comprehensive loss to interest expense, net of capitalized interest. During the three months ended March 31, 2023 and 2022, we reclassified $4 million and $3 million, respectively, of net losses into interest expense. Over the next 12 months, we expect to reclassify a gain of $87 million, which includes $75 million relating to the interest rate swap settlements, to interest expense, net of capitalized interest.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income Taxes	Note 11. Income Taxes Three Months Ended March 31, 2023 2022 Income tax expense $ 5 $ 24 Effective tax rate 4.4 % 31.6 % We were included in Lilly's U.S. tax examinations by the Internal Revenue Service through the full separation date of March 11, 2019. Pursuant to the tax matters agreement we executed with Lilly in connection with our initial public offering (IPO), the potential liabilities or potential refunds attributable to pre-IPO periods in which Elanco was included in a Lilly consolidated or combined tax return remain with Lilly. The U.S. examination of tax years 2016 to 2018 began in the fourth quarter of 2019 and remains ongoing. It is possible that the examination of these tax years could conclude within the next 12 months. Final resolution of certain matters is dependent upon several factors, including the potential for formal administrative proceedings. For the three months ended March 31, 2023, we recognized income tax expense of $5 million. Our effective tax rate of 4.4% differs from the statutory income tax rate due to jurisdictional earnings mix of projected income in lower tax jurisdictions, partially offset by losses in the U.S. and a Southeast Asia affiliate for which there is no tax benefit as valuation allowances have been established in those countries. For the three months ended March 31, 2022, we recognized income tax expense of $24 million. Our effective tax rate of 31.6% differs from the statutory income tax rate largely due to certain research and experimentation costs being capitalized beginning January 1, 2022, as provided under the Tax Cuts and Jobs Act. This increased the expected profits in jurisdictions with higher statutory tax rates as well as expected U.S. international tax inclusions, which are partially offset by utilization of net operating losses and valuation allowance release in the U.S.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 12. Commitments and Contingencies Legal Matters We are party to various legal actions that arise in the normal course of business. The most significant matters are described below. Loss contingency provisions are recorded when it is deemed probable that we will incur a loss and we can formulate a reasonable estimate of that loss. For the litigation matters discussed below for which a loss is reasonably possible, we are unable to estimate the possible loss or range of loss, if any. The process of resolving these matters is inherently uncertain and may develop over an extended period of time; therefore, at this time, the ultimate resolutions cannot be predicted. As of March 31, 2023 and December 31, 2022, we had no material liabilities established related to litigation as there were no significant claims which were probable and estimable. On May 20, 2020, a shareholder class action lawsuit captioned Hunter v. Elanco Animal Health Inc., et al. was filed in the United States District Court for the Southern District of Indiana (the Court) against Elanco and certain executives. On September 3, 2020, the Court appointed a lead plaintiff, and on November 9, 2020, the lead plaintiff filed an amended complaint adding additional claims against Elanco, certain executives and other individuals. The lawsuit alleges, in part, that Elanco and certain of its executives made materially false and/or misleading statements and/or failed to disclose certain facts about Elanco’s supply chain, inventory, revenue and projections. The lawsuit seeks unspecified monetary damages and purports to represent purchasers of Elanco securities between September 30, 2018 and May 6, 2020, and purchasers of Elanco common stock issued in connection with Elanco's acquisition of Aratana. We filed a motion to dismiss on January 13, 2021. On August 17, 2022, the Court issued an order granting our motion to dismiss the case without prejudice. On October 14, 2022, the plaintiffs filed a motion for leave to amend the complaint. We filed an opposition to the plaintiffs' motion on December 7, 2022. We believe the claims made in the case are meritless, and we intend to vigorously defend our position. On October 16, 2020, a shareholder class action lawsuit captioned Saffron Capital Corporation v. Elanco Animal Health Inc., et al. was filed in the Marion Superior Court of Indiana against Elanco, certain executives and other individuals and entities. On December 23, 2020, the plaintiffs filed an amended complaint adding an additional plaintiff. The lawsuit alleges, in part, that Elanco and certain of its executives made materially false and/or misleading statements and/or failed to disclose certain facts about Elanco’s relationships with third party distributors and revenue attributable to those distributors within the registration statement on Form S-3 dated January 21, 2020 and accompanying prospectus filed in connection with Elanco’s public offering which closed on or about January 27, 2020. The lawsuit seeks unspecified monetary damages and purports to represent purchasers of Elanco common stock or 5.00% TEUs issued in connection with the public offering. From February 2021 to August 2022, this case was stayed in deference to Hunter v. Elanco Animal Health Inc . On October 24, 2022, we filed a motion to dismiss. The plaintiffs filed their opposition to the motion to dismiss on December 23, 2022. We believe the claims made in the case are meritless, and we intend to vigorously defend our position. Claims seeking actual damages, injunctive relief and/or restitution for allegedly deceptive marketing have been made against Elanco Animal Health Inc. and Bayer HealthCare LLC, along with other Elanco and Bayer entities, arising out of the use of Seresto™ , a non-prescription flea and tick collar for cats and dogs. During 2021, putative class action lawsuits were filed in federal courts in the U.S. alleging that the Seresto collars contain pesticides that can cause serious injury and death to cats and/or dogs wearing the product. The cases mention the existence of incident reports involving humans, but no plaintiff has claimed personal harm from the product. In August 2021, the lawsuits were consolidated by the Judicial Panel on Multidistrict Litigation, and the cases were transferred to the Northern District of Illinois. We are vigorously defending these lawsuits. In January 2023, a lawsuit seeking damages for alleged negligence, breach of statutory regulations, breach of statutory duties and deceptive marketing was filed in Israel against Elanco among other parties, arising out of the use of Seresto and Foresto™ , a flea and tick collar for cats and dogs that is marketed and sold in Europe and in Israel. We intend to defend our position vigorously. Further, in March 2021, a member of the U.S. House of Representatives who was serving as a subcommittee chair requested that Elanco produce certain documents and information related to the Seresto collar and further made a request to temporarily recall Seresto collars from the market. On June 15, 2022, the subcommittee held a hearing at which our CEO testified. During and after the hearing, the subcommittee chair repeated his request that Elanco voluntarily recall the collars and also requested that the Environmental Protection Agency (EPA) commence administrative proceedings that would allow the EPA to remove Seresto from the market. Seresto is a pesticide registered with the EPA. In April 2021, a non-profit organization submitted a petition to the EPA requesting that the agency take action to cancel Seresto’s pesticide registration and suspend the registration pending cancellation. In response to the EPA's request for comments from the public on the petition, we submitted a comment to the EPA supporting the safety profile of Seresto and have since engaged in discussions with the EPA. Data and scientific evaluation used during the product registration process and through pharmacovigilance review supports the product’s positive safety profile and efficacy. We believe no removal, recall, or cancellation of the pesticide registration is warranted, nor has it been suggested by any regulatory agency. We continue to stand behind the safety profile for Seresto , and it remains available to consumers globally. In the third quarter of 2019, Tevra Brands, LLC (Tevra) filed a complaint in the U.S. District Court of the Northern District of California, alleging that Bayer Animal Health (acquired by us in August 2020) had been involved in unlawful exclusive dealing and tying of its flea and tick products Advantage , Advantix and Seresto and maintained a monopoly in the market. The complaint was amended in March 2020 and then dismissed in September 2020 with leave to amend. A second amended complaint was filed in March 2021 and realleges claims of unlawful exclusive dealing related to Advantage and Advantix and monopoly maintenance. A motion to dismiss the second amended complaint was denied in January 2022. Tevra’s demands include both actual and treble damages. The trial is scheduled in July 2024. We intend to defend our position vigorously. Regulatory Matters On July 1, 2021, we received a subpoena from the SEC relating to our channel inventory and sales practices prior to mid-2020. We have cooperated in providing documents and information to the SEC and will continue to do so. Management believes that its actions were appropriate. At this stage, we are unable to estimate the range of any potential loss associated with this matter. Other Commitments As of March 31, 2023, we have a lease commitment that has not yet commenced for our new corporate headquarters in Indianapolis, Indiana. Total minimum lease payments are estimated to be approximately $378 million over a term of 25 years, excluding extensions. Final lease payments may vary depending on the actual cost of certain construction activities. Lease commencement is expected in 2025.

Geographic Information

Geographic Information	3 Months Ended
	Mar. 31, 2023
Segment Reporting [Abstract]
Geographic Information	Note 13. Geographic Information We operate as a single operating segment engaged in the development, manufacturing, marketing and sales of animal health products worldwide for both pets and farm animals. Consistent with our operational structure, our CEO, as the chief operating decision maker, makes resource allocation and business process decisions globally across our consolidated business. Strategic decisions are managed globally with global functional leaders responsible for determining significant costs/investments and with regional leaders responsible for overseeing the execution of the global strategy. Our global research and development organization is responsible for development of new products. Our manufacturing organization is responsible for the manufacturing and supply of products and for the optimization of our supply chain. Regional leaders are responsible for the distribution and sale of our products and for local direct costs. The business is also supported by global corporate staff functions. Managing and allocating resources at the global corporate level enables our CEO to assess the overall level of resources available and how to best deploy these resources across functions, product types, regional commercial organizations and research and development projects in line with our overarching long-term corporate-wide strategic goals, rather than on a product or geographic basis. Consistent with this decision-making process, our CEO uses consolidated, single-segment financial information for purposes of evaluating performance, allocating resources, setting incentive compensation targets, as well as forecasting future period financial results. Our products include AviPro™, Baytril™, Catosal™, Clynav™, Cydectin™, Denagard™, Maxiban™, Rumensin™ , Pulmotil™ and other products for livestock, poultry and aquaculture, as well as Advantage™, Advantix™, Advocate™ (with several brands collectively referred to as the Advantage Family), Credelio™, TruCan™ , Galliprant™, Interceptor™ Plus, Seresto, Trifexis™ and other products for pets. We have a single customer that accounted for 9% and 10% of revenue for the three months ended March 31, 2023 and 2022, respectively. Product sales with this customer resulted in accounts receivable of $66 million and $73 million as of March 31, 2023 and December 31, 2022, respectively. We are exposed to the risk of changes in social, political and economic conditions inherent in foreign operations and our results of operations and the value of our foreign assets are affected by fluctuations in foreign currency exchange rates. Selected geographic area information was as follows: Three Months Ended March 31, 2023 2022 Revenue United States $ 543 $ 522 International 714 704 Revenue $ 1,257 $ 1,226

Earning Per Share

Earning Per Share	3 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
Earning Per Share	Note 14. Earnings Per Share We compute basic earnings (loss) per share by dividing net income (loss) available to common shareholders by the actual weighted average number of common shares outstanding for the reporting period. Elanco has variable common stock equivalents relating to certain equity awards in stock-based compensation arrangements. We also had variable common stock equivalents related to the TEU prepaid stock purchase contracts during the three months ended March 31, 2022 and in the first quarter of 2023 through the settlement date of February 1, 2023 (see Note 8: Equity for further discussion). Diluted earnings per share reflects the potential dilution that could occur if holders of the unvested equity awards converted their holdings into common stock and that could have occurred if holders of unsettled TEUs had converted their holdings into common stock prior to the February 1, 2023 settlement date. The weighted average number of potentially dilutive shares outstanding is calculated using the treasury stock method. Potential common shares that would have the effect of increasing diluted earnings per share (or reducing loss per share) are considered to be anti-dilutive and as such, these shares are not included in the calculation of diluted earnings (loss) per share. Basic and diluted earnings per share are calculated as follows: Three Months Ended March 31, 2023 2022 Net income available to common shareholders $ 103 $ 51 Determination of shares: Basic weighted average common shares outstanding (1) 491.1 488.0 Assumed conversion of dilutive common stock equivalents (2) 1.7 4.2 Diluted weighted average shares outstanding 492.8 492.2 Earnings per share (3) Basic $ 0.21 $ 0.10 Diluted $ 0.21 $ 0.10 (1) The TEU prepaid stock purchase contracts were convertible into a minimum of 14.3 million shares or a maximum of 17.2 million shares. The minimum 14.3 million shares were included in the calculation of basic weighted average shares from January 22, 2020 to February 1, 2023. The 17.2 million shares that were ultimately issued were included in the calculation of basic weighted average shares after the settlement date, from February 1, 2023 to March 31, 2023. (2) For the three months ended March 31, 2023 and 2022, approximately 1.4 million and 0.1 million, respectively, of potential common shares were excluded from the calculation of diluted loss per share because their effect was anti-dilutive. (3) Due to rounding conventions, loss per share may not recalculate precisely based on the amounts presented within this table.

Basis of Presentation and Sum_2

Basis of Presentation and Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the SEC requirements for interim reporting. As permitted under those rules, certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the U.S. (GAAP) have been condensed or omitted. The information included in this Form 10-Q should be read in conjunction with our consolidated financial statements and accompanying notes for the year ended December 31, 2022 included in our 2022 Form 10-K . In addition, results for interim periods should not be considered indicative of results for any other interim period or for the full year ending December 31, 2023 or any other future period. In our opinion, the financial statements reflect all adjustments (including those that are normal and recurring) that are necessary for fair presentation of the results of operations for the periods shown. In preparing financial statements in conformity with GAAP, we must make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures at the date of the financial statements and during the reporting period. Actual results could differ from those estimates. Certain reclassifications of prior year information have been made to conform to the current year's presentation.
Implementation of New Financial Accounting Pronouncements	The following table provides a brief description of an accounting standard that was recently adopted: Standard Description Effective Date Effect on the Financial Statements or Other Significant Matters ASU 2020-04, Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting; ASU 2021-01, Reference Rate Reform (Topic 848): Scope; ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. ASU 2021-01 clarifies the scope of Topic 848 so that derivatives affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions. ASU 2022-06 extends the period of time entities can utilize the reference rate reform relief guidance under ASU 2020-04 from December 31, 2022 to December 31, 2024. Adoption of the guidance is optional and effective as of March 12, 2020 through December 31, 2024. Adoption is permitted at any time during the period on a prospective basis. Effective April 1, 2023, and in accordance with the provisions outlined in our underlying credit agreements, we have transitioned the reference rate used in our credit facilities from the London Interbank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (Term SOFR). The change did not have a material impact on our condensed consolidated financial statements.

Implementation of New Financi_2

Implementation of New Financial Accounting Pronouncements (Tables)	3 Months Ended
	Mar. 31, 2023
Accounting Changes and Error Corrections [Abstract]
Description of Accounting Standards Adopted and Not Yet Adopted	The following table provides a brief description of an accounting standard that was recently adopted: Standard Description Effective Date Effect on the Financial Statements or Other Significant Matters ASU 2020-04, Reference Rate Reform (Topic 848) - Facilitation of the Effects of Reference Rate Reform on Financial Reporting; ASU 2021-01, Reference Rate Reform (Topic 848): Scope; ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. ASU 2021-01 clarifies the scope of Topic 848 so that derivatives affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions. ASU 2022-06 extends the period of time entities can utilize the reference rate reform relief guidance under ASU 2020-04 from December 31, 2022 to December 31, 2024. Adoption of the guidance is optional and effective as of March 12, 2020 through December 31, 2024. Adoption is permitted at any time during the period on a prospective basis. Effective April 1, 2023, and in accordance with the provisions outlined in our underlying credit agreements, we have transitioned the reference rate used in our credit facilities from the London Interbank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (Term SOFR). The change did not have a material impact on our condensed consolidated financial statements.

Revenue (Tables)

Revenue (Tables)	3 Months Ended
	Mar. 31, 2023
Revenue from Contract with Customer [Abstract]
Summary of Activity in Sales Rebates and Discounts Liability	The following table summarizes the activity in our global sales rebates and discounts liability: Three Months Ended March 31, 2023 2022 Beginning balance $ 324 $ 319 Reduction of revenue 209 219 Payments (204) (241) Ending balance $ 329 $ 297
Summary of Disaggregation of Revenue	The following table summarizes our revenue disaggregated by product category: Three Months Ended March 31, 2023 2022 Pet Health $ 675 $ 640 Farm Animal: Cattle 248 247 Poultry 183 180 Swine 102 99 Aqua 40 43 Total Farm Animal 573 569 Contract Manufacturing (1) 9 17 Revenue $ 1,257 $ 1,226

Acquisitions, Divestitures an_2

Acquisitions, Divestitures and Other Arrangements (Tables)	3 Months Ended
	Mar. 31, 2023
Business Combination and Asset Acquisition [Abstract]
Summary of Purchase Consideration	The composition of the purchase price is as follows: Up-front cash consideration $ 16 Deferred cash consideration due January 4, 2024 5 Fair value of contingent consideration 35 Total purchase consideration $ 56
Summary of Recognized Identified Assets Acquired and Liabilities Assumed	The following table summarizes the preliminary amounts recognized for assets acquired as of the acquisition date: Estimated Fair Value at January 3, 2023 Inventory $ 3 Intangible assets: Marketed products 28 Acquired in-process research and development (IPR&D) 9 Other intangible assets 15 Total identifiable assets 55 Goodwill (1) 1 Total consideration transferred $ 56 (1) The goodwill recognized from this acquisition is primarily attributable to NutriQuest's assembled workforce and expected synergies. The goodwill associated with this acquisition is deductible for tax purposes.

Asset Impairment, Restructuri_2

Asset Impairment, Restructuring and Other Special Charges (Tables)	3 Months Ended
	Mar. 31, 2023
Restructuring and Related Activities [Abstract]
Summary of Asset Impairment, Restructuring and Other Special Charges	Components of asset impairment, restructuring and other special charges are as follows: Three Months Ended March 31, 2023 2022 Restructuring charges (credits): Severance and other costs (1) $ — $ (7) Facility exit costs — 1 Acquisition related charges: Transaction and integration costs (2) 40 24 Non-cash and other items: Asset write-down (3) — 22 Total expense $ 40 $ 40 (1) 2022 credits primarily relate to adjustments resulting from the reversal of severance accruals associated with 2021 restructuring programs resulting from final negotiations and certain restructured employees filling open positions. (2) Transaction costs represent external costs directly related to acquiring businesses and primarily include expenditures for banking, legal, accounting and other similar services. Integration costs represent internal and external incremental costs directly related to integrating acquired businesses, including the acquisition of Bayer Animal Health (e.g., expenditures for consulting, system and process integration and product transfers), as well as independent company stand-up costs related to the implementation of new systems, programs and processes.
Summary of Activity in Reserves	The following table summarizes the activity in our reserves established in connection with restructuring activities: Severance Balance at December 31, 2021 $ 126 Reserve adjustments (7) Cash paid (42) Foreign currency translation adjustments (1) Balance at March 31, 2022 $ 76 Balance at December 31, 2022 $ 36 Cash paid (24) Foreign currency translation adjustments — Balance at March 31, 2023 $ 12

Inventories (Tables)

Inventories (Tables)	3 Months Ended
	Mar. 31, 2023
Inventory Disclosure [Abstract]
Schedule of Inventories	Inventories consisted of the following: March 31, 2023 December 31, 2022 Finished products $ 749 $ 725 Work in process 605 605 Raw materials and supplies 299 266 Total 1,653 1,596 Decrease to LIFO cost (57) (58) Inventories $ 1,596 $ 1,538

Debt (Tables)

Debt (Tables)	3 Months Ended
	Mar. 31, 2023
Debt Disclosure [Abstract]
Schedule of Long-term Debt	Long-term debt consisted of the following: March 31, 2023 December 31, 2022 Incremental Term Facility due 2025 $ 175 $ 175 Incremental Term Facility due 2028 492 494 Incremental Term Facility due 2029 249 249 Term Loan B due 2027 3,870 3,881 Revolving Credit Facility (1) 200 — 4.272% Senior Notes due 2023 344 344 4.900% Senior Notes due 2028 750 750 TEU Amortizing Notes due 2023 (2) — 7 Unamortized debt issuance costs (60) (64) 6,020 5,836 Less current portion of long-term debt 381 388 Total long-term debt $ 5,639 $ 5,448 (1) During the three months ended March 31, 2023, we drew on our revolving credit facility to fund working capital needs. (2) The TEU amortizing notes matured on February 1, 2023.

Financial Instruments and Fai_2

Financial Instruments and Fair Value (Tables)	3 Months Ended
	Mar. 31, 2023
Fair Value Disclosures [Abstract]
Summary of Fair Value Information	The following table summarizes the fair value information at March 31, 2023 and December 31, 2022 for foreign exchange contract assets (liabilities), investments, contingent consideration liabilities and cash flow hedge assets (liabilities) measured at fair value on a recurring basis in the respective balance sheet line items, as well as long-term debt (including TEU amortizing notes) for which fair value is disclosed on a recurring basis: Fair Value Measurements Using Financial statement line item Carrying Quoted Prices in Active Markets for Identical Assets Significant Significant Fair March 31, 2023 Prepaid expenses and other - foreign exchange contracts not designated as hedging instruments $ 28 $ — $ 28 $ — $ 28 Prepaid expense and other - forward-starting interest rate contracts designated as cash flow hedges 8 — 8 — 8 Other noncurrent assets - forward-starting interest rate contracts designated as cash flow hedges 3 — 3 3 Other noncurrent assets - investments 6 6 — — 6 Other current liabilities - foreign exchange contracts not designated as hedging instruments (25) — (25) — (25) Other current liabilities - contingent consideration (23) — — (23) (23) Other noncurrent liabilities - contingent consideration (12) — — (12) (12) Other noncurrent liabilities - forward-starting interest rate contracts designated as cash flow hedges (9) — (9) — (9) Long-term debt, including current portion (6,080) — (5,891) — (5,891) December 31, 2022 Prepaid expenses and other - foreign exchange contracts not designated as hedging instruments $ 76 $ — $ 76 $ — $ 76 Prepaid expenses and other - forward-starting interest rate contracts designated as cash flow hedges 14 — 14 — 14 Other noncurrent assets - forward-starting interest rate contracts designated as cash flow hedges 10 — 10 — 10 Other noncurrent assets - investments 7 7 — — 7 Other current liabilities - foreign exchange contracts not designated as hedging instruments (64) — (64) — (64) Long-term debt, including current portion (5,900) — (5,711) — (5,711)
Summary of Gain (loss), Net of Tax	The amount of net gains (losses) on derivative instruments not designated as hedging instruments, recorded in other expense, net were as follows: Three Months Ended March 31, 2023 2022 Foreign exchange forward contracts (1) $ 2 $ (8) (1) These amounts were substantially offset in other expense, net by the effect of changing exchange rates on the underlying foreign currency exposures. The amounts of net gains (losses) on cash flow hedges recorded, net of tax, in other comprehensive income, are as follows: Three Months Ended March 31, 2023 2022 Forward-starting interest rate swaps $ (48) $ 109

Income Taxes (Tables)

Income Taxes (Tables)	3 Months Ended
	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Summary of Provision for Taxes on Income	Three Months Ended March 31, 2023 2022 Income tax expense $ 5 $ 24 Effective tax rate 4.4 % 31.6 %

Geographic Information (Tables)

Geographic Information (Tables)	3 Months Ended
	Mar. 31, 2023
Segment Reporting [Abstract]
Summary of Selected Geographic Area Information	Selected geographic area information was as follows: Three Months Ended March 31, 2023 2022 Revenue United States $ 543 $ 522 International 714 704 Revenue $ 1,257 $ 1,226

Earning Per Share (Tables)

Earning Per Share (Tables)	3 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
Summary of Basic And Diluted Loss	Basic and diluted earnings per share are calculated as follows: Three Months Ended March 31, 2023 2022 Net income available to common shareholders $ 103 $ 51 Determination of shares: Basic weighted average common shares outstanding (1) 491.1 488.0 Assumed conversion of dilutive common stock equivalents (2) 1.7 4.2 Diluted weighted average shares outstanding 492.8 492.2 Earnings per share (3) Basic $ 0.21 $ 0.10 Diluted $ 0.21 $ 0.10 (1) The TEU prepaid stock purchase contracts were convertible into a minimum of 14.3 million shares or a maximum of 17.2 million shares. The minimum 14.3 million shares were included in the calculation of basic weighted average shares from January 22, 2020 to February 1, 2023. The 17.2 million shares that were ultimately issued were included in the calculation of basic weighted average shares after the settlement date, from February 1, 2023 to March 31, 2023. (2) For the three months ended March 31, 2023 and 2022, approximately 1.4 million and 0.1 million, respectively, of potential common shares were excluded from the calculation of diluted loss per share because their effect was anti-dilutive. (3) Due to rounding conventions, loss per share may not recalculate precisely based on the amounts presented within this table.

Background (Details)

Background (Details)	Mar. 31, 2023 brand country
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of brands in diverse portfolio | brand	200
Number of countries in which entity operates (more than) | country	90

Revenue - Narrative (Details)

Revenue - Narrative (Details)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Geographic Concentration Risk | Sales rebates and discounts, liability | United States
Concentration Risk [Line Items]
Concentration risk	76%	74%
Product Return Concentration Risk | Net revenue | Global Customers
Concentration Risk [Line Items]
Concentration risk	1%	1%

Revenue - Activity in Sales Reb

Revenue - Activity in Sales Rebates and Discounts Liability (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Change In Contract With Customer, Liability [Roll Forward]
Beginning balance	$ 324	$ 319
Reduction of revenue	209	219
Payments	(204)	(241)
Ending balance	$ 329	$ 297

Revenue - Disaggregation of Rev

Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Disaggregation of Revenue [Line Items]
Revenue	$ 1,257	$ 1,226
Pet Health
Disaggregation of Revenue [Line Items]
Revenue	675	640
Farm Animal
Disaggregation of Revenue [Line Items]
Revenue	573	569
Cattle
Disaggregation of Revenue [Line Items]
Revenue	248	247
Poultry
Disaggregation of Revenue [Line Items]
Revenue	183	180
Swine
Disaggregation of Revenue [Line Items]
Revenue	102	99
Aqua
Disaggregation of Revenue [Line Items]
Revenue	40	43
Contract Manufacturing
Disaggregation of Revenue [Line Items]
Revenue	$ 9	$ 17

Acquisitions, Divestitures an_3

Acquisitions, Divestitures and Other Arrangements - Summary of The Composition of The Purchase Consideration (Details) - NutriQuest, LLC $ in Millions	Jan. 03, 2023 USD ($)
Business Acquisition [Line Items]
Up-front cash consideration	$ 16
Deferred cash consideration due January 4, 2024	5
Fair value of contingent consideration	35
Total purchase consideration	$ 56

Acquisitions, Divestitures an_4

Acquisitions, Divestitures and Other Arrangements - NutriQuest US Acquisition & Pending Acquisitions (Details) $ in Millions	Jan. 22, 2023 USD ($) installment	Jan. 03, 2023 USD ($)	Mar. 31, 2023 USD ($)
NutriQuest, LLC
Business Acquisition [Line Items]
Contingent consideration liability		$ 35	$ 35
Weighted average useful life		12 years
Total purchase consideration		$ 56
NutriQuest Brazil
Business Acquisition [Line Items]
Total purchase consideration	$ 24
Number of installments | installment	2
Maximum | NutriQuest, LLC
Business Acquisition [Line Items]
Contingent consideration liability		$ 85

Acquisitions, Divestitures an_5

Acquisitions, Divestitures and Other Arrangements - Amounts Recognized for Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions	Mar. 31, 2023	Jan. 03, 2023	Dec. 31, 2022
Business Acquisition [Line Items]
Goodwill	$ 6,061		$ 5,993
NutriQuest, LLC
Business Acquisition [Line Items]
Inventory		$ 3
Total identifiable assets		55
Goodwill		1
Total consideration transferred		56
NutriQuest, LLC | Marketed products
Business Acquisition [Line Items]
Intangible assets		28
NutriQuest, LLC | Acquired in-process research and development (IPR&D)
Business Acquisition [Line Items]
Intangible assets		9
NutriQuest, LLC | Other intangible assets
Business Acquisition [Line Items]
Intangible assets		$ 15

Acquisitions, Divestitures an_6

Acquisitions, Divestitures and Other Arrangements - Divestitures and BexCaFe Arrangement (Details) $ in Millions			3 Months Ended	12 Months Ended	20 Months Ended
	May 09, 2023	Aug. 01, 2021 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Mar. 31, 2023 USD ($)	Jun. 30, 2022 USD ($)	Feb. 01, 2022 USD ($)	Dec. 31, 2021 employee
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Contract with customer, asset, before allowance for credit loss							$ 55
Liabilities			$ 8,289	$ 8,202	$ 8,289
Variable Interest Entity, Primary Beneficiary | BexCaFe, LLC
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Liabilities						$ 59
Payment on agreement			13
Variable Interest Entity, Primary Beneficiary | BexCaFe, LLC | Future Milestone Payments And Sales Royalties
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Liabilities			$ 36		36	49
Variable Interest Entity, Primary Beneficiary | BexCaFe, LLC | Acquired in-process research and development (IPR&D)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Finite-lived intangible assets						$ 59
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of employees transferred | employee								600
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Microbiome R&D Platform Carve-Out
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain on disposal				$ 3
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Shawnee and Speke
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash received in agreement to divest		$ 78
Duration over which proceeds will be received		3 years
Proceeds from site divestitures					$ 13
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Shawnee and Speke | Subsequent Event
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Duration over which proceeds will be received	12 months

Asset Impairment, Restructuri_3

Asset Impairment, Restructuring and Other Special Charges - Component of Asset Impairment, Restructuring and Other Special Charges (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Restructuring charges (credits):
Severance and other costs	$ 0	$ (7)
Facility exit costs	0	1
Acquisition related charges:
Transaction and integration costs	40	24
Non-cash and other items:
Asset write-down	0	22
Total expense	$ 40	$ 40

Asset Impairment, Restructuri_4

Asset Impairment, Restructuring and Other Special Charges - Activity in Reserves (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2024
Forecast
Restructuring Reserve [Roll Forward]
Cash paid			$ (7)
Severance
Restructuring Reserve [Roll Forward]
Balance at beginning of period	$ 36	$ 126	$ 12
Reserve adjustments		(7)
Cash paid	(24)	(42)
Foreign currency translation adjustments	0	(1)
Balance at end of period	$ 12	$ 76

Asset Impairment, Restructuri_5

Asset Impairment, Restructuring and Other Special Charges - Narrative (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Mar. 31, 2024
Restructuring Cost and Reserve [Line Items]
Expected payment term	12 months
Forecast
Restructuring Cost and Reserve [Line Items]
Cash paid		$ 7

Inventories (Details)

Inventories (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Finished products	$ 749	$ 725
Work in process	605	605
Raw materials and supplies	299	266
Total	1,653	1,596
Decrease to LIFO cost	(57)	(58)
Inventories	$ 1,596	$ 1,538

Equity (Details)

Equity (Details) - Tangible Equity Unit - USD ($) $ / shares in Units, $ in Millions	1 Months Ended
	Jan. 31, 2020	Jan. 30, 2020	Feb. 01, 2023
Class of Stock [Line Items]
TEUs issued (in shares)		11,000,000
Offering price (usd per share)	$ 50
Proceeds after underwriting discounts and commissions	$ 528
Equity component	86%
Debt component	14%
Settlement rate			156.25%
Shares issued upon conversion of prepaid stock purchase contracts (in shares)			17,000,000
Maximum
Class of Stock [Line Items]
Average applicable market value necessary to be included in calculation of diluted shares outstanding (usd per share)			$ 32

Debt - Long-term Debt (Details)

Debt - Long-term Debt (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Unamortized debt issuance costs	$ (60)	$ (64)
Total debt	6,020	5,836
Less current portion of long-term debt	381	388
Total long-term debt	5,639	5,448
Credit facility | Secured Debt | Incremental Term Facility due 2025
Debt Instrument [Line Items]
Long-term debt, gross	175	175
Credit facility | Secured Debt | Incremental Term Facility due 2028
Debt Instrument [Line Items]
Long-term debt, gross	492	494
Credit facility | Secured Debt | Incremental Term Facility due 2029
Debt Instrument [Line Items]
Long-term debt, gross	249	249
Credit facility | Term Loan B due 2027
Debt Instrument [Line Items]
Long-term debt, gross	3,870	3,881
Credit facility | Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt, gross	200	0
Senior Notes | 4.272% Senior Notes due 2023
Debt Instrument [Line Items]
Long-term debt, gross	$ 344	344
Interest rate	4.272%
Senior Notes | 4.900% Senior Notes due 2028
Debt Instrument [Line Items]
Long-term debt, gross	$ 750	750
Interest rate	4.90%
Senior Notes | TEU Amortizing Notes due 2023
Debt Instrument [Line Items]
Long-term debt, gross	$ 0	$ 7

Financial Instruments and Fai_3

Financial Instruments and Fair Value - Narrative (Details) - USD ($) $ in Millions	1 Months Ended			3 Months Ended
	Mar. 31, 2023	Sep. 30, 2022	Apr. 30, 2022	Mar. 31, 2023	Mar. 31, 2022	Oct. 01, 2023	Jan. 03, 2023	Dec. 31, 2022
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Equity method investments	$ 27			$ 27				$ 27
Unrealized gains associated with cancelled swaps				27
Reclassification from AOCI				4	$ 3
Unrealized gains	87			87
NutriQuest, LLC
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Contingent consideration liability	35			35			$ 35
NutriQuest, LLC | Maximum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Contingent consideration liability							$ 85
Designated as Hedging Instrument
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Unrealized gain (loss) on investments				(21)	$ 109
Cross-currency fixed interest rate swap | Not Designated as Hedging Instrument
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Notional amount	912			912				784
Forward-starting interest rate contracts designated as cash flow hedges | Designated as Hedging Instrument
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Notional amount	3,050			$ 3,050				$ 3,050
Increase in derivative notional amount during period	$ 1,000
Fixed interest rate	4.40%			4.40%
Unrealized gains	$ 75			$ 75
Forward-starting interest rate contracts designated as cash flow hedges | Designated as Hedging Instrument | Forecast
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fixed interest rate						4.10%
Forward-starting interest rate contracts designated as cash flow hedges | Designated as Hedging Instrument | Cash Flow Hedging
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash received for derivative settlement		$ 75	$ 132

Financial Instruments and Fai_4

Financial Instruments and Fair Value - Fair Value Information (Details) - Recurring - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt, including current portion	$ 0	$ 0
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt, including current portion	(5,891)	(5,711)
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt, including current portion	0	0
Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt, including current portion	(6,080)	(5,900)
Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt, including current portion	(5,891)	(5,711)
Prepaid expenses and other | Foreign exchange contracts not designated as hedging instruments | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Prepaid expenses and other | Foreign exchange contracts not designated as hedging instruments | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	28	76
Prepaid expenses and other | Foreign exchange contracts not designated as hedging instruments | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Prepaid expenses and other | Foreign exchange contracts not designated as hedging instruments | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	28	76
Prepaid expenses and other | Foreign exchange contracts not designated as hedging instruments | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	28	76
Prepaid expenses and other | Forward-starting interest rate contracts designated as cash flow hedges | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Prepaid expenses and other | Forward-starting interest rate contracts designated as cash flow hedges | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	8	14
Prepaid expenses and other | Forward-starting interest rate contracts designated as cash flow hedges | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Prepaid expenses and other | Forward-starting interest rate contracts designated as cash flow hedges | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	8	14
Prepaid expenses and other | Forward-starting interest rate contracts designated as cash flow hedges | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	8	14
Other noncurrent assets | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	6	7
Other noncurrent assets | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Other noncurrent assets | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Other noncurrent assets | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	6	7
Other noncurrent assets | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	6	7
Other noncurrent assets | Forward-starting interest rate contracts designated as cash flow hedges | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Other noncurrent assets | Forward-starting interest rate contracts designated as cash flow hedges | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	3	10
Other noncurrent assets | Forward-starting interest rate contracts designated as cash flow hedges | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)		0
Other noncurrent assets | Forward-starting interest rate contracts designated as cash flow hedges | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	3	10
Other noncurrent assets | Forward-starting interest rate contracts designated as cash flow hedges | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	3	10
Other current liabilities | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	0
Other current liabilities | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	0
Other current liabilities | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	(23)
Other current liabilities | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	(23)
Other current liabilities | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	(23)
Other current liabilities | Foreign exchange contracts not designated as hedging instruments | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Other current liabilities | Foreign exchange contracts not designated as hedging instruments | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	(25)	(64)
Other current liabilities | Foreign exchange contracts not designated as hedging instruments | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0	0
Other current liabilities | Foreign exchange contracts not designated as hedging instruments | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	(25)	(64)
Other current liabilities | Foreign exchange contracts not designated as hedging instruments | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	(25)	$ (64)
Other noncurrent liabilities | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	0
Other noncurrent liabilities | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	0
Other noncurrent liabilities | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	(12)
Other noncurrent liabilities | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	(12)
Other noncurrent liabilities | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	(12)
Other noncurrent liabilities | Forward-starting interest rate contracts designated as cash flow hedges | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0
Other noncurrent liabilities | Forward-starting interest rate contracts designated as cash flow hedges | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	(9)
Other noncurrent liabilities | Forward-starting interest rate contracts designated as cash flow hedges | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	0
Other noncurrent liabilities | Forward-starting interest rate contracts designated as cash flow hedges | Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	(9)
Other noncurrent liabilities | Forward-starting interest rate contracts designated as cash flow hedges | Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets (liabilities)	$ (9)

Financial Instruments and Fai_5

Financial Instruments and Fair Value - Net Gains/Losses on Derivative Instruments (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cross-currency fixed interest rate swap | Not Designated as Hedging Instrument
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Foreign exchange forward contracts	$ 2	$ (8)
Forward-starting interest rate contracts designated as cash flow hedges | Designated as Hedging Instrument | Cash Flow Hedging
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Forward-starting interest rate swaps	$ (48)	$ 109

Income Taxes - Provision for Ta

Income Taxes - Provision for Taxes on Income (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Tax Disclosure [Abstract]
Income tax expense	$ 5	$ 24
Effective tax rate	4.40%	31.60%

Income Taxes - Narrative (Detai

Income Taxes - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Tax Disclosure [Abstract]
Income tax expense	$ 5	$ 24
Effective tax rate	4.40%	31.60%

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022	Dec. 31, 2021	Oct. 16, 2020
Commitments and Contingencies Disclosure [Abstract]
Percent of TEUs issued involved in lawsuit				5%
Operating lease, lease not yet commenced liability	$ 378
Lessee, operating lease, lease not yet commenced, term of contract	25 years
New corporate headquarters, estimated total incentive to be funded by TIF	$ 64
Tax Incremental Financing, commitment amount			$ 64
Refund within next three months		$ 15

Geographic Information - Narrat

Geographic Information - Narrative (Details) $ in Millions	3 Months Ended
	Mar. 31, 2023 USD ($) segment	Mar. 31, 2022	Dec. 31, 2022 USD ($)
Concentration Risk [Line Items]
Number of operating segments | segment	1
Accounts receivable	$ 1,051		$ 797
Product Sales
Concentration Risk [Line Items]
Accounts receivable	$ 66		$ 73
Customer Concentration Risk | Revenue | Single Customer
Concentration Risk [Line Items]
Concentration risk (as a percent)	9%	10%

Geographic Information - Select

Geographic Information - Selected Geographic Area Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 1,257	$ 1,226
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	543	522
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 714	$ 704

Earning Per Share (Details)

Earning Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	2 Months Ended	3 Months Ended		36 Months Ended
	Mar. 31, 2023	Mar. 31, 2023	Mar. 31, 2022	Jan. 31, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net income available to common shareholders		$ 103	$ 51
Determination of shares:
Basic weighted average common shares outstanding (in shares)		491.1	488
Assumed conversion of dilutive common stock equivalents (in shares)		1.7	4.2
Diluted weighted average shares outstanding (in shares)		492.8	492.2
Earnings per share
Basic (usd per share)		$ 0.21	$ 0.10
Diluted (usd per share)		$ 0.21	$ 0.10
Antidilutive shares not included in calculating diluted loss per share (in shares)		1.4	0.1
Tangible Equity Unit
Earnings per share
Conversion of tangible equity units (TEUs) into common stock (in shares)	17.2
Minimum | Tangible Equity Unit
Earnings per share
Conversion of tangible equity units (TEUs) into common stock (in shares)		14.3		14.3
Maximum | Tangible Equity Unit
Earnings per share
Conversion of tangible equity units (TEUs) into common stock (in shares)		17.2