Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Apr. 03, 2016 | May. 09, 2016 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Apr. 3, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | PFE | |
Entity Registrant Name | PFIZER INC | |
Entity Central Index Key | 78,003 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 6,064,849,361 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Income Statement [Abstract] | |||
Revenues | [1],[2] | $ 13,005 | $ 10,864 |
Costs and expenses: | |||
Cost of sales | [1],[3] | 2,851 | 1,838 |
Selling, informational and administrative expenses | [1],[3] | 3,385 | 3,104 |
Research and development expenses | [1],[3] | 1,731 | 1,885 |
Amortization of intangible assets | [1] | 1,006 | 940 |
Restructuring charges and certain acquisition-related costs | [1] | 141 | 60 |
Other (income)/deductions––net | [1] | 330 | (46) |
Income from continuing operations before provision for taxes on income | [1],[4] | 3,561 | 3,082 |
Provision for taxes on income | [1] | 535 | 706 |
Income from continuing operations | [1] | 3,026 | 2,376 |
Discontinued operations––net of tax | [1] | 0 | 5 |
Net income before allocation to noncontrolling interests | [1],[5],[6] | 3,026 | 2,381 |
Less: Net income attributable to noncontrolling interests | [1] | 9 | 6 |
Net income attributable to Pfizer Inc. | [1] | $ 3,016 | $ 2,376 |
Earnings per common share––basic: | |||
Income from continuing operations attributable to Pfizer Inc. common shareholders (in dollars per share) | [1] | $ 0.49 | $ 0.38 |
Discontinued operations––net of tax (in dollars per share) | [1] | 0 | 0 |
Net income attributable to Pfizer Inc. common shareholders (in dollars per share) | [1] | 0.49 | 0.38 |
Earnings per common share––diluted: | |||
Income from continuing operations attributable to Pfizer Inc. common shareholders (in dollars per share) | [1] | 0.49 | 0.38 |
Discontinued operations––net of tax (in dollars per share) | [1] | 0 | 0 |
Net income attributable to Pfizer Inc. common shareholders (in dollars per share) | [1] | $ 0.49 | $ 0.38 |
Weighted-average shares––basic | [1] | 6,150 | 6,203 |
Weighted-average shares––diluted | [1] | 6,214 | 6,292 |
Cash dividends paid per common share (in dollars per share) | [1] | $ 0.3 | $ 0.28 |
[1] | Amounts may not add due to rounding. | ||
[2] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. | ||
[3] | Excludes amortization of intangible assets, except as disclosed in Note 9A. Identifiable Intangible Assets and Goodwill:Identifiable Intangible Assets. | ||
[4] | Income from continuing operations before provision for taxes on income. | ||
[5] | Amounts may not add due to rounding. | ||
[6] | Amounts may not add due to rounding. |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Statement of Comprehensive Income [Abstract] | |||
Net income before allocation to noncontrolling interests | [1],[2],[3] | $ 3,026 | $ 2,381 |
Other Comprehensive Income/(Loss) | |||
Foreign currency translation adjustments, net | [1] | 67 | (1,308) |
Other comprehensive income (loss), foreign currency transaction and translation adjustment, before tax | [1] | 67 | (1,308) |
Unrealized holding losses on derivative financial instruments, net | [1] | (273) | (315) |
Reclassification adjustments for realized (gains)/losses | [1],[4] | (339) | 234 |
Other comprehensive income (loss), derivatives qualifying as hedges, before tax, total | [1] | (612) | (82) |
Unrealized holding gains/(losses) on available-for-sale securities, net | [1] | 129 | (328) |
Reclassification adjustments for realized losses | [1],[4] | 209 | 247 |
Other comprehensive income (loss), available-for-sale securities adjustment, before tax, total | [1] | 339 | (81) |
Benefit plans: actuarial gains, net | [1] | 0 | 32 |
Reclassification adjustments related to amortization | [1],[5] | 139 | 136 |
Reclassification adjustments related to settlements, net | [1],[5] | 26 | 40 |
Other | [1] | 38 | 158 |
Defined benefit plan, amounts recognized in other comprehensive income (loss), net gain (loss), before tax, total | [1] | 203 | 365 |
Benefit plans: prior service costs and other, net | [1] | 0 | (1) |
Reclassification adjustments related to amortization | [1],[5] | (41) | (35) |
Reclassification adjustments related to curtailments, net | [1],[5] | (6) | (10) |
Other | [1] | 5 | 0 |
Defined benefit plan, amounts recognized in other comprehensive income (loss), net prior service cost, before tax | [1] | (42) | (46) |
Other comprehensive loss, before tax | [1] | (44) | (1,152) |
Tax provision/(benefit) on other comprehensive loss | [1],[6] | (41) | 105 |
Other comprehensive loss before allocation to noncontrolling interests | [1] | (4) | (1,257) |
Comprehensive income before allocation to noncontrolling interests | [1] | 3,022 | 1,124 |
Less: Comprehensive income/(loss) attributable to noncontrolling interests | [1] | 4 | (10) |
Comprehensive income attributable to Pfizer Inc. | [1] | $ 3,019 | $ 1,134 |
[1] | Amounts may not add due to rounding. | ||
[2] | Amounts may not add due to rounding. | ||
[3] | Amounts may not add due to rounding. | ||
[4] | Reclassified into Other (income)/deductions—net in the condensed consolidated statements of income. | ||
[5] | Generally reclassified, as part of net periodic pension cost, into Cost of sales, Selling, informational and administrative expenses, and/or Research and development expenses, as appropriate, in the condensed consolidated statements of income. For additional information, see Note 10. Pension and Postretirement Benefit Plans. | ||
[6] | See Note 5C. Tax Matters: Tax Provision/(Benefit) on Other Comprehensive Loss. |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 | |
Assets | |||
Cash and cash equivalents | [1],[2] | $ 2,561 | $ 3,641 |
Short-term investments | [1] | 16,882 | 19,649 |
Trade accounts receivable, less allowance for doubtful accounts: 2016—$649; 2015—$384 | [1] | 9,033 | 8,176 |
Inventories | [1] | 7,578 | 7,513 |
Current tax assets | [1] | 2,888 | 2,662 |
Other current assets | [1] | 2,355 | 2,163 |
Total current assets | [1] | 41,298 | 43,804 |
Long-term investments | [1] | 14,146 | 15,999 |
Property, plant and equipment, less accumulated depreciation: 2016—$14,002; 2015—$13,502 | [1] | 13,584 | 13,766 |
Identifiable intangible assets, less accumulated amortization | [1],[3] | 39,602 | 40,356 |
Goodwill | [1] | 48,558 | 48,242 |
Noncurrent deferred tax assets and other noncurrent tax assets | [1] | 1,738 | 1,794 |
Other noncurrent assets | [1] | 4,003 | 3,420 |
Total assets | [1] | 162,929 | 167,381 |
Liabilities and Equity | |||
Short-term borrowings, including current portion of long-term debt | [1] | 11,546 | 10,159 |
Trade accounts payable | [1] | 3,125 | 3,620 |
Dividends payable | [1] | 0 | 1,852 |
Income taxes payable | [1] | 920 | 418 |
Accrued compensation and related items | [1] | 1,725 | 2,359 |
Other current liabilities | [1] | 11,419 | 10,990 |
Total current liabilities | [1] | 28,735 | 29,399 |
Long-term debt | [1] | 27,824 | 28,740 |
Pension benefit obligations, net | [1] | 5,264 | 6,310 |
Postretirement benefit obligations, net | [1] | 1,980 | 1,809 |
Noncurrent deferred tax liabilities | [1] | 26,547 | 26,877 |
Other taxes payable | [1] | 4,053 | 3,992 |
Other noncurrent liabilities | [1] | 5,180 | 5,257 |
Total liabilities | [1] | $ 99,582 | $ 102,384 |
Commitments and Contingencies | [1] | ||
Preferred stock | [1] | $ 26 | $ 26 |
Common stock | [1] | 460 | 459 |
Additional paid-in capital | [1] | 81,443 | 81,016 |
Treasury stock | [1] | (84,313) | (79,252) |
Retained earnings | [1] | 74,971 | 71,993 |
Accumulated other comprehensive loss | [1] | (9,520) | (9,522) |
Total Pfizer Inc. shareholders’ equity | [1] | 63,068 | 64,720 |
Equity attributable to noncontrolling interests | [1] | 279 | 278 |
Total equity | [1] | 63,347 | 64,998 |
Total liabilities and equity | [1] | $ 162,929 | $ 167,381 |
[1] | Amounts may not add due to rounding. | ||
[2] | Amounts may not add due to rounding. | ||
[3] | The decrease in Identifiable intangible assets, less accumulated amortization, is primarily related to amortization, partially offset by assets acquired, the impact of measurement period adjustments related to our acquisition of Hospira (see Note 2A) and the impact of foreign exchange. |
CONDENSED CONSOLIDATED BALANCE5
CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 649 | $ 384 |
Property, plant and equipment, accumulated depreciation | $ 14,002 | $ 13,502 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Millions | 3 Months Ended | |||
Apr. 03, 2016 | Mar. 29, 2015 | |||
Operating Activities | ||||
Net income before allocation to noncontrolling interests | [1],[2],[3] | $ 3,026 | $ 2,381 | |
Adjustments to reconcile net income before allocation to noncontrolling interests to net cash provided by operating activities: | ||||
Depreciation and amortization | [2] | 1,425 | 1,260 | |
Asset write-offs and impairments | [2] | 146 | 11 | |
Deferred taxes from continuing operations | [2] | (204) | (41) | |
Share-based compensation expense | [2] | 143 | 162 | |
Benefit plan contributions in excess of expense | [2] | (853) | (874) | |
Other adjustments, net | [2] | 229 | (336) | |
Other changes in assets and liabilities, net of acquisitions and divestitures | [2] | (2,261) | (1,883) | |
Net cash provided by operating activities | [2] | 1,651 | 680 | |
Investing Activities | ||||
Purchases of property, plant and equipment | [2] | (301) | (239) | |
Purchases of short-term investments | [2] | (3,489) | (7,546) | |
Proceeds from redemptions/sales of short-term investments | [2] | 7,922 | 10,702 | |
Net proceeds from redemptions/sales of short-term investments with original maturities of three months or less | [2] | 493 | 5,243 | |
Purchases of long-term investments | [2] | (1,308) | (3,150) | |
Proceeds from redemptions/sales of long-term investments | [2] | 1,142 | 1,937 | |
Acquisitions of businesses, net of cash acquired | [2] | (110) | (678) | |
Acquisitions of intangible assets | [2] | 0 | (7) | |
Other investing activities, net | [2] | 6 | 330 | |
Net cash provided by investing activities | [2] | 4,355 | 6,592 | |
Financing Activities | ||||
Proceeds from short-term borrowings | [2] | 682 | 1,999 | |
Principal payments on short-term borrowings | [2] | (1,350) | 0 | |
Net proceeds from short-term borrowings with original maturities of three months or less | [2] | 1,724 | 863 | |
Principal payments on long-term debt | [2] | (1,536) | (2,998) | |
Purchases of common stock | [2] | (5,000) | (6,000) | |
Cash dividends paid | [2] | (1,854) | (1,758) | |
Proceeds from exercise of stock options | [2] | 296 | 794 | |
Other financing activities, net | [2] | 25 | 122 | |
Net cash used in financing activities | [2] | (7,014) | (6,978) | |
Effect of exchange-rate changes on cash and cash equivalents | [2] | (73) | (74) | |
Net increase/(decrease) in cash and cash equivalents | [2] | (1,080) | 220 | |
Cash and cash equivalents, beginning | [2] | 3,641 | [4] | 3,343 |
Cash and cash equivalents, end | [2] | 2,561 | [4] | 3,563 |
Cash paid during the period for: | ||||
Income taxes | [2] | 518 | 372 | |
Interest | [2] | $ 382 | $ 332 | |
[1] | Amounts may not add due to rounding. | |||
[2] | Amounts may not add due to rounding. | |||
[3] | Amounts may not add due to rounding. | |||
[4] | Amounts may not add due to rounding. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Apr. 03, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies A. Basis of Presentation We prepared the condensed consolidated financial statements following the requirements of the United States (U.S.) Securities and Exchange Commission (SEC) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by accounting principles generally accepted in the United States of America (U.S. GAAP) can be condensed or omitted. The financial information included in our condensed consolidated financial statements for subsidiaries operating outside the U.S. is as of and for the three months ended February 28, 2016 and February 22, 2015 . The financial information included in our condensed consolidated financial statements for U.S. subsidiaries is as of and for the three months ended April 3, 2016 and March 29, 2015 . Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be representative of those for the full year. We are responsible for the unaudited financial statements included in this Quarterly Report on Form 10-Q. The financial statements include all normal and recurring adjustments that are considered necessary for the fair presentation of our condensed consolidated balance sheets and condensed consolidated statements of income. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in our 2015 Annual Report on Form 10-K. Unless the context requires otherwise, references to “Pfizer,” “the Company,” “we,” “us” or “our” in this Quarterly Report on Form 10-Q refer to Pfizer Inc. and its subsidiaries. Certain amounts in the condensed consolidated financial statements and associated notes may not add due to rounding. All percentages have been calculated using unrounded amounts. In the condensed consolidated balance sheet as of December 31, 2015, we performed certain reclassifications to conform to the current period presentation of Other current assets , Other noncurrent assets , Short-term borrowings, including current portion of long-term debt and Long-term debt , and in the condensed consolidated statement of cash flows for the three months ended March 29, 2015, we performed certain reclassifications to conform to the current presentation of Proceeds from short-term borrowings for debt issuance costs in accordance with the adoption of a new accounting standard (for additional information, see Note 1B ). Certain prior period reclassifications were made to the Global Established Pharmaceutical (GEP) segment operating results to conform to the current period presentation for certain organizational changes impacting GEP in 2016. For additional information, see Note 13 . On April 6, 2016, we announced that the merger agreement between Pfizer and Allergan plc (Allergan) entered into on November 22, 2015 was terminated by mutual agreement of the companies. The decision was driven by the actions announced by the U.S. Department of Treasury on April 4, 2016, which the companies concluded qualified as an “Adverse Tax Law Change” under the merger agreement. In connection with the termination of the merger agreement, on April 8, 2016 (which falls into Pfizer’s second fiscal quarter), Pfizer paid Allergan $150 million (pre-tax) for reimbursement of Allergan’s expenses associated with the terminated transaction. Pfizer and Allergan also released each other from any and all claims in connection with the merger agreement or the transactions contemplated thereby. On September 3, 2015, we completed our acquisition of Hospira, Inc. (Hospira) and, commencing from the acquisition date, our financial statements reflect the assets, liabilities. operating results and cash flows of Hospira. As a result, legacy Hospira operations are reflected in our results of operations, GEP’s operating results, and cash flows for the first quarter of 2016, but not for the first quarter of 2015. Legacy Hospira assets and liabilities are reflected in our balance sheets as of April 3, 2016 and December 31, 2015. B. Adoption of New Accounting Standards We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016, debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $75 million ). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ( $1 million from Other current assets and $79 million from Other noncurrent assets ) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $79 million ) to conform to the current period presentation. For additional information, see Note 7A. We adopted a new standard as of January 1, 2016 that requires an acquirer to recognize adjustments made in the measurement period to provisional amounts of assets acquired and liabilities assumed in a business combination in the reporting period in which the adjustment amounts are determined. There was no material impact to our condensed consolidated financial statements in the first quarter of 2016 from adopting this standard. For additional information, see Note 2A. We adopted a new standard as of January 1, 2016 related to the accounting for hybrid financial instruments issued or held as investments and there was no material impact to our condensed consolidated financial statements from adopting this standard. C. Fair Value Our fair value methodologies depend on the following types of inputs: • Quoted prices for identical assets or liabilities in active markets (Level 1 inputs). • Quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are directly or indirectly observable, or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means (Level 2 inputs). • Unobservable inputs that reflect estimates and assumptions (Level 3 inputs). A single estimate of fair value can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. |
Acquisitions, Research and Deve
Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments | 3 Months Ended |
Apr. 03, 2016 | |
Business Combinations, Discontinued Operations And Disposal Groups, Collaborative Arrangements And Equity Method Investments [Abstract] | |
Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments | Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments A. Acquisitions Hospira, Inc. (Hospira) On September 3, 2015 (the acquisition date), we acquired Hospira, a leading provider of sterile injectable drugs and infusion technologies as well as a provider of biosimilars, for $90 per share in cash. The total fair value of consideration transferred for Hospira was approximately $16.1 billion in cash ( $15.7 billion , net of cash acquired). Hospira is now a subsidiary of Pfizer. The combination of local Pfizer and Hospira entities may be pending in various jurisdictions and integration is subject to completion of various local legal and regulatory steps. The following table summarizes the provisional amounts recognized for assets acquired and liabilities assumed as of the acquisition date, as well as adjustments made in the first quarter of 2016 to the provisional amounts initially recorded in 2015 (measurement period adjustments) with a corresponding change to goodwill. Certain estimated values are not yet finalized (see below) and are subject to change, which could be significant. We will finalize the amounts recognized as we obtain the information necessary to complete the analyses, but no later than one year from the acquisition date. (MILLIONS OF DOLLARS) Amounts Recognized as of Acquisition Date (as previously reported as of December 31, 2015) Measurement Period Adjustments Amounts Recognized as of Acquisition Date (as adjusted) Working capital, excluding inventories $ 274 $ (6 ) $ 268 Inventories 1,924 (16 ) 1,908 Property, plant and equipment (a) 2,410 (53 ) 2,357 Identifiable intangible assets, excluding in-process research and development (a) 8,270 65 8,335 In-process research and development 995 5 1,000 Other noncurrent assets 408 (46 ) 362 Long-term debt (1,928 ) — (1,928 ) Benefit obligations (117 ) — (117 ) Net income tax accounts (3,394 ) 25 (3,369 ) Other noncurrent liabilities (39 ) — (39 ) Total identifiable net assets 8,803 (25 ) 8,778 Goodwill 7,284 25 7,309 Net assets acquired/total consideration transferred $ 16,087 $ — $ 16,087 (a) The measurement period adjustments for Identifiable intangible assets reflect changes in the estimated fair value of acquired finite-lived developed technology rights. The measurement period adjustments for Property, plant and equipment primarily reflect changes in the estimated fair value of acquired buildings and machinery and equipment. The changes in the estimated fair values for identifiable intangible assets and property, plant and equipment are primarily to better reflect market participant assumptions about facts and circumstances existing as of the acquisition date. The measurement period adjustments did not result from intervening events subsequent to the acquisition date. The change in the provisional amounts had no material impact on our results of operations. The following items are subject to change: • Amounts for certain balances included in working capital (excluding inventories), certain investments and certain legal contingencies, pending receipt of certain information that could affect provisional amounts recorded. We do not believe any adjustments for legal contingencies will have a material impact on our consolidated financial statements. • Amounts for intangibles, inventory and property, plant and equipment, pending finalization of valuation efforts for acquired intangible assets as well as the completion of certain physical inventory counts and the confirmation of the physical existence and condition of certain property, plant and equipment assets. • Amounts for income tax assets, receivables and liabilities, pending the filing of Hospira pre-acquisition tax returns and the receipt of information including but not limited to that from taxing authorities, which may change certain estimates and assumptions used. The following table provides supplemental pro forma information as if the acquisition of Hospira had occurred on January 1, 2014: Unaudited Supplemental Pro Forma Consolidated Results Three Months Ended (MILLIONS OF DOLLARS, EXCEPT PER SHARE DATA) March 29, Revenues $ 12,039 Net income attributable to Pfizer Inc. common shareholders 2,375 Diluted earnings per share attributable to Pfizer Inc. common shareholders 0.38 The unaudited supplemental pro forma consolidated results do not purport to reflect what the combined company’s results of operations would have been had the acquisition occurred on January 1, 2014, nor do they project the future results of operations of the combined company or reflect the expected realization of any cost savings associated with the acquisition. The actual results of operations of the combined company may differ significantly from the pro forma adjustments reflected here due to many factors. The unaudited supplemental pro forma financial information includes various assumptions, including those related to the preliminary purchase price allocation of the assets acquired and the liabilities assumed from Hospira. The unaudited supplemental pro forma consolidated results reflect the historical financial information of Pfizer and Hospira, adjusted to give effect to the acquisition of Hospira as if it had occurred on January 1, 2014, primarily for the following pre-tax adjustments: • Elimination of Hospira’s historical intangible asset amortization expense (approximately $12 million in the first quarter of 2015). • Additional amortization expense (approximately $127 million in the first quarter of 2015) related to the preliminary estimate of the fair value of identifiable intangible assets acquired. • Additional depreciation expense (approximately $22 million in the first quarter of 2015) related to the preliminary estimate of the fair value adjustment to property, plant and equipment (PP&E) acquired. • Adjustment related to the preliminary estimate of the non-recurring fair value adjustment to acquisition-date inventory estimated to have been sold (the addition of $5 million of charges in the first quarter of 2015). • Adjustment to decrease interest expense (approximately $10 million in the first quarter of 2015) related to the fair value adjustment of Hospira debt. • Adjustment for non-recurring acquisition-related costs directly attributable to the acquisition (the elimination of $14 million of charges in the first quarter of 2015), reflecting non-recurring charges incurred by Hospira, which would have been recorded in 2014 under the pro forma assumption that the Hospira acquisition was completed on January 1, 2014. Pfizer did not incur any such charges in the first quarter of 2015. The above adjustments were adjusted for the applicable tax impact. The taxes associated with the adjustments related to the preliminary estimate of the fair value adjustment for acquired intangible assets, property, plant and equipment, inventory and debt reflect the statutory tax rates in the various jurisdictions where the adjustments are expected to be incurred. The taxes associated with the elimination of Hospira’s historical intangible asset amortization expense and the adjustment for the acquisition-related costs directly attributable to the acquisition were based on the tax rate in the jurisdiction in which the related deductible costs were incurred. Marketed Vaccines Business of Baxter International Inc. (Baxter) On December 1, 2014 (which falls in the first fiscal quarter of 2015 for our international operations), we acquired Baxter ’ s portfolio of marketed vaccines for a final purchase price of $648 million . The portfolio that was acquired consists of NeisVac-C and FSME-IMMUN/TicoVac. NeisVac-C is a vaccine that helps protect against meningitis caused by group C meningococcal meningitis and FSME-IMMUN/TicoVac is a vaccine that helps protect against tick-borne encephalitis. In connection with this acquisition, we recorded $376 million in Identifiable intangible assets, primarily consisting of $371 million in Developed technology rights. We also recorded $194 million of Inventories and $12 million in Goodwill . The final allocation of the consideration transferred to the assets acquired and the liabilities assumed has been completed. B. Research and Development and Collaborative Arrangements Research and Development Arrangement with RPI Finance Trust (RPI) In January 2016, Pfizer entered into an agreement with RPI, a subsidiary of Royalty Pharma, under which RPI will fund up to $300 million in development costs related to certain Phase III clinical trials of Pfizer’s Ibrance (palbociclib) product primarily for adjuvant treatment of hormone receptor positive early breast cancer (the Indication). If successful and upon approval of Ibrance in the U.S. or certain major markets in the European Union (EU) for the Indication based on the applicable clinical trials, RPI will be eligible to receive a combination of approval-based fixed milestone payments of up to $250 million dependent upon results of the clinical trials and royalties on certain Ibrance sales over approximately seven years. RPI’s development funding is expected to cover up to 100% of the costs primarily for the applicable clinical trials through 2021. As there is a substantive and genuine transfer of risk to RPI, the development funding is recognized by us as an obligation to perform contractual services and therefore is a reduction of Research and development expenses as incurred. The reduction to Research and development expenses for the first quarter of 2016 totaled $8.8 million . Fixed milestone payments due upon approval will be recorded as intangible assets and amortized to Amortization of intangible assets over the estimated commercial life of the Ibrance product and sales-based royalties will be recorded as Cost of sales when incurred. Collaboration with Eli Lilly & Company (Lilly) In October 2013, we entered into a collaboration agreement with Lilly to jointly develop and globally commercialize Pfizer’s tanezumab, which provides that Pfizer and Lilly will equally share product-development expenses as well as potential revenues and certain product-related costs. Following the decision by the U.S. Food and Drug Administration (FDA) in March 2015 to lift the partial clinical hold on the tanezumab development program, we received a $200 million upfront payment from Lilly in accordance with the collaboration agreement between Pfizer and Lilly, which is recorded as deferred income in our condensed consolidated balance sheet and is being recognized into Other (income)/deductions––net over a multi-year period beginning in the second quarter of 2015. Pfizer and Lilly resumed the Phase 3 chronic pain program for tanezumab in July 2015, which will consist of six studies in approximately 7,000 patients across osteoarthritis, chronic low back pain and cancer pain. Under the collaboration agreement with Lilly, we are eligible to receive additional payments from Lilly upon the achievement of specified regulatory and commercial milestones. Collaboration with OPKO Health, Inc. (OPKO) We entered into a collaborative agreement with OPKO, which closed in January 2015, to develop and commercialize OPKO’s long-acting human growth hormone (hGH-CTP) for the treatment of growth hormone deficiency (GHD) in adults and children, as well as for the treatment of growth failure in children born small for gestational age (SGA) who fail to show catch-up growth by two years of age. hGH-CTP has the potential to reduce the required dosing frequency of human growth hormone to a single weekly injection from the current standard of one injection per day. We have received the exclusive license to commercialize hGH-CTP worldwide. OPKO will lead the clinical activities and will be responsible for funding the development programs for the key indications, which include Adult and Pediatric GHD and Pediatric SGA. We will be responsible for all development costs for additional indications, all postmarketing studies, manufacturing and commercialization activities for all indications, and we will lead the manufacturing activities related to product development. In February 2015, we made an upfront payment of $295 million to OPKO, which was recorded in Research and development expenses, and OPKO is eligible to receive up to an additional $275 million upon the achievement of certain regulatory milestones. OPKO is also eligible to receive royalty payments associated with the commercialization of hGH-CTP for Adult GHD, which is subject to regulatory approval. Upon the launch of hGH-CTP for Pediatric GHD, which is subject to regulatory approval, the royalties will transition to tiered gross profit sharing for both hGH-CTP and our product, Genotropin. C. Equity-Method Investments Investment in Hisun Pfizer Pharmaceuticals Company Limited (Hisun Pfizer) In the first quarter of 2016, we determined that we had an other-than-temporary decline in the value of Hisun Pfizer, our 49% -owned equity-method investment in China, and, therefore, we recognized a loss of $81 million in Other (income)/deductions––net (see Note 4 ) . The decline in value resulted from lower expectations as to the future cash flows to be generated by Hisun Pfizer, primarily as a result of an increase in risk due to the continued slowdown in the Chinese economy. As of April 3, 2016 , the carrying value of our investment in Hisun Pfizer is $680 million , which is included in Long-term investments . In valuing our investment in Hisun Pfizer, we used discounted cash flow techniques, utilizing a 13.0% discount rate, reflecting our best estimate of the various risks inherent in the projected cash flows, and a nominal terminal year growth factor. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which include the expected impact of competitive, legal, economic and/or regulatory forces on the products; the long-term growth rate, which seeks to project the sustainable growth rate over the long-term; and the discount rate, which seeks to reflect the various risks inherent in the projected cash flows, including country risk. Investment in Laboratório Teuto Brasileiro S.A. (Teuto) In the first quarter of 2016, we determined that we had an other-than-temporary decline in the value of Teuto, a 40% -owned generics company in Brazil, and, therefore, we recognized a loss of $50 million in Other (income)/deductions––net (see Note 4 ) related to our equity method investment. The decline in value resulted from lower expectations as to the future cash flows to be generated by Teuto, primarily due to a slowdown in Brazilian economic conditions, which have been impacted by political risk, higher inflation, and the depreciation of the Brazilian Real. In valuing our investment in Teuto, we used discounted cash flow techniques, utilizing a 17.5% discount rate, reflecting our best estimate of the various risks inherent in the projected cash flows, and a nominal terminal year growth factor. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which include the expected impact of competitive, legal, economic and/or regulatory forces on the products; the long-term growth rate, which seeks to project the sustainable growth rate over the long-term; and the discount rate, which seeks to reflect the various risks inherent in the projected cash flows, including country risk. We have an option to acquire the remaining 60% of Teuto, and Teuto’s shareholders have an option to sell their 60% stake in the company to us. Under the terms of our agreement with Teuto’s other shareholders, 2016 is the final year in which the call and put options may be exercised. Our investment in Teuto is accounted for under the equity method due to the significant influence we have over the operations of Teuto through our board representation, minority veto rights and 40% voting interest. |
Restructuring Charges and Other
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives | 3 Months Ended |
Apr. 03, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives | Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives We incur significant costs in connection with acquiring, integrating and restructuring businesses and in connection with our global cost-reduction/productivity initiatives. For example: • In connection with acquisition activity, we typically incur costs associated with executing the transactions, integrating the acquired operations (which may include expenditures for consulting and the integration of systems and processes), and restructuring the combined company (which may include charges related to employees, assets and activities that will not continue in the combined company); and • In connection with our cost-reduction/productivity initiatives, we typically incur costs and charges associated with site closings and other facility rationalization actions, workforce reductions and the expansion of shared services, including the development of global systems. All of our businesses and functions may be impacted by these actions, including sales and marketing, manufacturing and research and development (R&D), as well as groups such as information technology, shared services and corporate operations. In connection with our acquisition of Hospira, we are focusing our efforts on achieving an appropriate cost structure for the combined company. For up to a three -year period post-acquisition, we expect to incur costs of approximately $1 billion (not including costs of $215 million in 2015 associated with the return of acquired in-process research and development rights as described in the Current-Period Key Activities section of Notes to Consolidated Financial Statements–– Note 3 . Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives in our 2015 Financial Report) associated with the integration of Hospira. In early 2014, we announced that we would be incurring costs in 2014-2016 related to new programs: our new global commercial structure reorganization and additional cost-reduction/productivity initiatives. We have the following initiatives underway associated with these programs: • Manufacturing plant network rationalization and optimization, where execution timelines are necessarily long. Our plant network strategy is expected to result in the exit of four sites over the next several years. In connection with these activities, during 2014-2016, we expect to incur costs of approximately $400 million associated with prior acquisition activity and costs of approximately $1.0 billion associated with new non-acquisition-related cost-reduction initiatives. Through April 3, 2016 , we incurred approximately $357 million and $570 million , respectively, associated with these initiatives. • The 2014 global commercial structure reorganization, which primarily includes the streamlining of certain functions, the realignment of regional locations and colleagues to support the businesses, as well as implementing the necessary system changes to support different reporting requirements. In connection with this reorganization, during 2014-2016, we expect to incur costs of approximately $225 million . Through April 3, 2016 , we incurred approximately $219 million associated with this reorganization. • Other new cost-reduction/productivity initiatives, primarily related to commercial property rationalization and consolidation. In connection with these cost-reduction activities, during 2014-2016, we expect to incur costs of approximately $850 million . Through April 3, 2016 , we incurred approximately $532 million associated with these initiatives. The costs expected to be incurred during 2014-2016, of approximately $2.5 billion in total for the above-mentioned programs (but not including expected costs associated with the Hospira integration), include restructuring charges, implementation costs and additional depreciation––asset restructuring. Of this amount, we expect that about a quarter of the charges will be non-cash. Current-Period Key Activities In the first quarter of 2016 , we incurred approximately $228 million in cost-reduction and acquisition-related costs (excluding transaction costs) primarily in connection with the acquisition of Hospira and the aforementioned programs, mainly associated with our manufacturing operations. The following table provides the components of costs associated with acquisitions and cost-reduction/productivity initiatives: Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, Restructuring charges (a) : Employee terminations $ 24 $ 31 Asset impairments 1 6 Exit costs 4 6 Total restructuring charges 30 42 Transaction costs (b) 24 5 Integration costs (c) 87 13 Restructuring charges and certain acquisition-related costs 141 60 Additional depreciation––asset restructuring recorded in our condensed consolidated statements of income as follows (d) : Cost of sales 45 17 Research and development expenses 4 1 Total additional depreciation––asset restructuring 49 18 Implementation costs recorded in our condensed consolidated statements of income as follows (e) : Cost of sales 43 13 Selling, informational and administrative expenses 12 26 Research and development expenses 6 8 Total implementation costs 62 48 Total costs associated with acquisitions and cost-reduction/productivity initiatives $ 252 $ 127 (a) In the three months ended April 3, 2016 , Employee terminations represent the expected reduction of the workforce by approximately 100 employees, mainly in manufacturing. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination. The restructuring charges for the three months ended April 3, 2016 are associated with the following: • the Global Innovative Pharmaceutical segment (GIP) ( $8 million ); the Global Vaccines, Oncology and Consumer Healthcare segment (VOC) ( $1 million ); the Global Established Pharmaceutical segment (GEP) ( $3 million ); Worldwide Research and Development and Medical (WRD/M) ( $3 million ); manufacturing operations ( $14 million ); and Corporate ( $1 million ). The restructuring charges for the three months ended March 29, 2015 are associated with the following: • GIP ( $12 million ); VOC ( $13 million ); GEP ( $10 million ); WRD/M ( $12 million ); manufacturing operations ( $22 million income); and Corporate ( $18 million ). (b) Transaction costs represent external costs for banking, legal, accounting and other similar services, most of which are directly related to the terminated transaction with Allergan. (c) Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes, primarily related to the acquisition of Hospira. (d) Additional depreciation––asset restructuring represents the impact of changes in the estimated useful lives of assets involved in restructuring actions. (e) Implementation costs represent external, incremental costs directly related to implementing our non-acquisition-related cost-reduction/productivity initiatives. The following table provides the components of and changes in our restructuring accruals: (MILLIONS OF DOLLARS) Employee Termination Costs Asset Impairment Charges Exit Costs Accrual Balance, December 31, 2015 (a) $ 1,109 $ — $ 48 $ 1,157 Provision 24 1 4 30 Utilization and other (b) (165 ) (1 ) (9 ) (175 ) Balance, April 3, 2016 (c) $ 968 $ — $ 43 $ 1,011 (a) Included in Other current liabilities ( $776 million ) and Other noncurrent liabilities ( $381 million ). (b) Includes adjustments for foreign currency translation. (c) Included in Other current liabilities ( $638 million ) and Other noncurrent liabilities ( $373 million ). |
Other (Income)_Deductions - Net
Other (Income)/Deductions - Net | 3 Months Ended |
Apr. 03, 2016 | |
Other Income and Expenses [Abstract] | |
Other (Income)/Deductions - Net | Other (Income)/Deductions—Net The following table provides components of Other (income)/deductions––net : Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, Interest income (a) $ (113 ) $ (93 ) Interest expense 306 309 Net interest expense 193 216 Royalty-related income (187 ) (222 ) Certain legal matters, net (b) 274 — Net gains on asset disposals (c) (9 ) (175 ) Certain asset impairments (d) 131 — Business and legal entity alignment costs (e) 51 101 Other, net (f) (122 ) 34 Other (income)/deductions––net $ 330 $ (46 ) (a) Interest income increased in the first quarter of 2016 , primarily due to higher investment returns. (b) In the first quarter of 2016 , primarily includes an accrual for an unresolved legal matter and a settlement related to a patent matter. (c) In the first quarter of 2016 , primarily includes gains on sales/out-licensing of product and compound rights (approximately $16 million ). In the first quarter of 2015 , primarily includes gains on sales/out-licensing of product and compound rights (approximately $45 million ) and gains on sales of investments in equity securities (approximately $120 million ). (d) In the first quarter of 2016 , represents an impairment loss of $81 million related to Pfizer’s 49% -owned equity-method investment with Zhejiang Hisun Pharmaceuticals Co., Ltd. (Hisun) in China, Hisun Pfizer, and an impairment loss of $50 million related to Pfizer's 40% -owned equity-method investment in Teuto. For additional information concerning Hisun Pfizer and Teuto, see Note 2C. (e) In the first quarter of 2016 and 2015 , represents expenses for changes to our infrastructure to align our commercial operations, including costs to internally separate our businesses into distinct legal entities, as well as to streamline our intercompany supply operations to better support each business. (f) In the first quarter of 2016 , primarily includes, among other things, income of $116 million from resolution of a contract disagreement. |
Tax Matters
Tax Matters | 3 Months Ended |
Apr. 03, 2016 | |
Income Tax Disclosure [Abstract] | |
Tax Matters | Tax Matters A. Taxes on Income from Continuing Operations Our effective tax rate for continuing operations was 15.0% for the first quarter of 2016 , compared to 22.9% for the first quarter of 2015 . The lower effective tax rate for the first quarter of 2016 in comparison with the same period in 2015 was primarily due to: • benefits related to the final resolution (pending court approval) of an agreement in principle reached in February 2016 to resolve certain claims related to Protonix, which resulted in the receipt of information that raised our assessment of the likelihood of prevailing on the technical merits of our tax position; • benefits associated with our Venezuela operations; • an increase in tax benefits associated with the resolution of certain tax positions pertaining to prior years with various foreign tax authorities, and the expiration of certain statutes of limitations; as well as • an increase in benefits associated with the U.S. R&D tax credit, which was not in effect in the prior year quarter but was permanently extended on December 18, 2015, partially offset by: • an unfavorable change in the jurisdictional mix of earnings as a result of operating fluctuations in the normal course of business. B. Tax Contingencies We are subject to income tax in many jurisdictions, and a certain degree of estimation is required in recording the assets and liabilities related to income taxes. All of our tax positions are subject to audit by the local taxing authorities in each tax jurisdiction. These tax audits can involve complex issues, interpretations and judgments and the resolution of matters may span multiple years, particularly if subject to negotiation or litigation. Our assessments are based on estimates and assumptions that have been deemed reasonable by management, but our estimates of unrecognized tax benefits and potential tax benefits may not be representative of actual outcomes, and variation from such estimates could materially affect our financial statements in the period of settlement or when the statutes of limitations expire, as we treat these events as discrete items in the period of resolution. The U.S. is one of our major tax jurisdictions, and we are regularly audited by the U.S. Internal Revenue Service (IRS): • With respect to Pfizer Inc., the IRS has issued a Revenue Agent ’ s Report (RAR) for tax years 2009 -2010. We are not in agreement with the RAR and are currently appealing certain disputed issues. Tax years 2011-2013 are currently under audit. Tax years 2014 -2016 are open, but not under audit. All other tax years are closed. • With respect to Hospira, Inc., the IRS is auditing 2010-2011 and 2012-2013. Tax years 2014-2015 (through date of acquisition) are open but not under audit. All other tax years are closed. The open tax years and audits for Hospira, Inc. and its subsidiaries are not considered material to Pfizer. In addition to the open audit years in the U.S., we have open audit years in other major tax jurisdictions, such as Canada (2010-2016), Japan (2015-2016), Europe (2007-2016, primarily reflecting Ireland, the United Kingdom, France, Italy, Spain and Germany), Latin America (1998-2016, primarily reflecting Brazil) and Puerto Rico (2010-2016). C. Tax Provision/(Benefit) on Other Comprehensive Loss The following table provides the components of Tax provision/(benefit) on other comprehensive loss: Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, Foreign currency translation adjustments, net (a) $ (14 ) $ 85 Unrealized holding losses on derivative financial instruments, net (36 ) (224 ) Reclassification adjustments for realized (gains)/losses (72 ) 183 (108 ) (41 ) Unrealized holding gains/(losses) on available-for-sale securities, net 17 (31 ) Reclassification adjustments for realized losses 26 (1 ) 43 (32 ) Benefit plans: actuarial gains, net — 12 Reclassification adjustments related to amortization 47 46 Reclassification adjustments related to settlements, net 9 15 Other (1 ) 37 55 109 Benefit plans: prior service costs and other, net — — Reclassification adjustments related to amortization (15 ) (13 ) Reclassification adjustments related to curtailments, net (2 ) (4 ) Other 1 — (16 ) (17 ) Tax provision/(benefit) on other comprehensive loss $ (41 ) $ 105 (a) Taxes are not provided for foreign currency translation adjustments relating to investments in international subsidiaries that will be held indefinitely. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests | 3 Months Ended |
Apr. 03, 2016 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests | Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests The following table provides the changes, net of tax, in Accumulated other comprehensive loss : Net Unrealized Gains/(Losses) Benefit Plans (MILLIONS OF DOLLARS) Foreign Currency Translation Adjustments Derivative Financial Instruments Available-For-Sale Securities Actuarial Gains/(Losses) Prior Service (Costs)/Credits and Other Accumulated Other Comprehensive Loss Balance, December 31, 2015 $ (5,863 ) $ 421 $ (227 ) $ (4,733 ) $ 880 $ (9,522 ) Other comprehensive income/(loss) (a) 87 (504 ) 296 148 (25 ) 2 Balance, April 3, 2016 $ (5,776 ) $ (83 ) $ 69 $ (4,585 ) $ 855 $ (9,520 ) (a) Amounts do not include foreign currency translation adjustments attributable to noncontrolling interests of $6 million loss for the first three months of 2016 . As of April 3, 2016 , with respect to derivative financial instruments, the amount of unrealized pre-tax losses estimated to be reclassified into income within the next 12 months is $144 million (which is expected to be offset primarily by gains resulting from reclassification adjustments related to available-for-sale securities). |
Financial Instruments
Financial Instruments | 3 Months Ended |
Apr. 03, 2016 | |
Financial Instruments [Abstract] | |
Financial Instruments | Financial Instruments A. Selected Financial Assets and Liabilities The following table provides additional information about certain of our financial assets and liabilities: (MILLIONS OF DOLLARS) April 3, December 31, Selected financial assets measured at fair value on a recurring basis (a) Trading funds (b) $ 260 $ 287 Available-for-sale debt securities (c) 27,819 32,078 Money market funds 947 934 Available-for-sale equity securities (c) 497 603 Derivative financial instruments in a receivable position (d) : Interest rate swaps 1,433 837 Foreign currency swaps 103 135 Foreign currency forward-exchange contracts 333 559 31,391 35,433 Other selected financial assets Held-to-maturity debt securities, carried at amortized cost (c), (e) 1,065 1,388 Private equity securities, carried at equity-method or at cost (e), (f) 1,250 1,336 2,315 2,724 Total selected financial assets $ 33,705 $ 38,157 Selected financial liabilities measured at fair value on a recurring basis (a) Derivative financial instruments in a liability position (g) : Interest rate swaps $ 9 $ 139 Foreign currency swaps 1,311 1,489 Foreign currency forward-exchange contracts 432 81 1,752 1,709 Other selected financial liabilities (h) Short-term borrowings, carried at historical proceeds, as adjusted (e), (i) 11,546 10,159 Long-term debt, carried at historical proceeds, as adjusted (i), (j) 27,824 28,740 39,370 38,899 Total selected financial liabilities $ 41,122 $ 40,608 (a) We use a market approach in valuing financial instruments on a recurring basis. For additional information, see Note 1C. All of our financial assets and liabilities measured at fair value on a recurring basis use Level 2 inputs in the calculation of fair value, except less than 1% that use Level 1 inputs and money market funds measured at net asset value. (b) As of April 3, 2016 , trading funds are composed of $204 million of trading equity funds and $56 million of trading debt funds. As of December 31, 2015 , trading funds are composed of $185 million of trading equity funds and $102 million of trading debt funds. As of April 3, 2016 and December 31, 2015 , trading equity funds of $65 million and $85 million , respectively, are held in trust for benefits attributable to the former Pharmacia Savings Plus Plan. (c) Gross unrealized gains and losses are not significant. (d) Designated as hedging instruments, except for certain contracts used as offsets; namely, foreign currency forward-exchange contracts with fair values of $144 million as of April 3, 2016 ; and foreign currency forward-exchange contracts with fair values of $136 million as of December 31, 2015 . (e) Short-term borrowings include foreign currency short-term borrowings with fair values of $547 million as of December 31, 2015 , which are used as hedging instruments. The differences between the estimated fair values and carrying values of held-to-maturity debt securities, private equity securities at cost and short-term borrowings not measured at fair value on a recurring basis were not significant as of April 3, 2016 or December 31, 2015 . The fair value measurements of our held-to-maturity debt securities and our short-term borrowings are based on Level 2 inputs, using a market approach. The fair value measurements of our priv ate equity securities carried at cost are based on Level 3 inputs. (f) Our private equity securities represent investments in the life sciences sector. (g) Designated as hedging instruments, except for certain contracts used as offsets; namely, foreign currency swaps with fair values of $188 million and foreign currency forward-exchange contracts with fair values of $117 million as of April 3, 2016 ; and foreign currency swaps with fair values of $234 million and foreign currency forward-exchange contracts with fair values of $59 million as of December 31, 2015 . (h) Some carrying amounts may include adjustments for discount or premium amortization or for the effect of hedging the interest rate fair value risk associated with certain financial liabilities by interest rate swaps. (i) We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016 , debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $75 million ). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ( $1 million from Other current assets and $79 million from Other noncurrent assets ) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $79 million ) to conform to the current period presentation. (j) The fair value of our long-term debt (not including the current portion of long-term debt) was $31.8 billion as of April 3, 2016 and $32.7 billion as of December 31, 2015 . The fair value measurements for our long-term debt are based on Level 2 inputs, using a market approach. Generally, the difference between the fair value of our long-term debt and the amount reported on the condensed consolidated balance sheet is due to a decline in relative market interest rates since the debt issuance. The following table provides the classification of these selected financial assets and liabilities in our condensed consolidated balance sheets: (MILLIONS OF DOLLARS) April 3, December 31, Assets Cash and cash equivalents $ 809 $ 978 Short-term investments 16,882 19,649 Long-term investments 14,146 15,999 Other current assets (a) 390 587 Other noncurrent assets (b) 1,478 944 $ 33,705 $ 38,157 Liabilities Short-term borrowings, including current portion of long-term debt (c) $ 11,546 $ 10,159 Other current liabilities (d) 862 645 Long-term debt (c) 27,824 28,740 Other noncurrent liabilities (e) 890 1,064 $ 41,122 $ 40,608 (a) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $5 million ), foreign currency swaps ( $62 million ) and foreign currency forward-exchange contracts ( $323 million ) and, as of December 31, 2015 , include interest rate swaps ( $2 million ), foreign currency swaps ( $46 million ) and foreign currency forward-exchange contracts ( $538 million ). (b) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $1,428 million ), foreign currency swaps ( $41 million ) and foreign currency forward-exchange contracts ( $9 million ) and, as of December 31, 2015 , include interest rate swaps ( $835 million ), foreign currency swaps ( $89 million ) and foreign currency forward-exchange contracts ( $20 million ). (c) We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016 , debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $75 million ). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ( $1 million from Other current assets and $79 million from Other noncurrent assets ) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $79 million ) to conform to the current period presentation. (d) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $5 million ), foreign currency swaps ( $454 million ) and foreign currency forward-exchange contracts ( $403 million ) and, as of December 31, 2015 , include interest rate swaps ( $5 million ), foreign currency swaps ( $560 million ) and foreign currency forward-exchange contracts ( $80 million ). (e) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $4 million ), foreign currency swaps ( $857 million ) and foreign currency forward-exchange contracts ( $29 million ) and, as of December 31, 2015 , include interest rate swaps ( $134 million ), foreign currency swaps ( $928 million ) and foreign currency forward-exchange contracts ( $1 million ). There were no significant impairments of financial assets recognized in any period presented. B. Investments in Debt Securities The following table provides the contractual maturities, or as necessary, the estimated maturities, of the available-for-sale and held-to-maturity debt securities: Years April 3, (MILLIONS OF DOLLARS) Within 1 Over 1 to 5 Over 5 to 10 Over 10 Total Available-for-sale debt securities Western European, Asian, Scandinavian and other government debt (a) $ 7,056 $ 1,033 $ 8 $ — $ 8,097 Corporate debt (b) 3,223 4,786 1,656 15 9,680 U.S. government debt 1,812 848 207 — 2,867 Federal Home Loan Mortgage Corporation and Federal National Mortgage Association asset-backed securities 34 2,110 71 11 2,227 Western European, Scandinavian and other government agency debt (a) 1,587 210 — — 1,797 Supranational debt (a) 911 323 — — 1,234 Government National Mortgage Association and other U.S. government guaranteed asset-backed securities 599 112 18 — 729 Other asset-backed debt (c) 461 682 40 4 1,188 Held-to-maturity debt securities Time deposits and other 1,024 5 — — 1,029 Western European government debt (a) 36 — — — 36 Total debt securities $ 16,744 $ 10,109 $ 2,001 $ 31 $ 28,884 (a) Issued by governments, government agencies or supranational entities, as applicable, all of which are investment-grade. (b) Issued by a diverse group of corporations, largely consisting of financial institutions, virtually all of which are investment-grade. (c) Includes loan-backed, receivable-backed, and mortgage-backed securities, all of which are investment-grade and in senior positions in the capital structure of the security. Loan-backed securities are collateralized by senior secured obligations of a diverse pool of companies or student loans, and receivable-backed securities are collateralized by credit cards receivables. Mortgage-backed securities are collateralized by diversified pools of residential and commercial mortgages. These securities are valued by third party models that use significant inputs derived from observable market data like prepayment rates, default rates, and recovery rates. C. Short-Term Borrowings Short-term borrowings include amounts for commercial paper of $6.5 billion as of April 3, 2016 and $4.9 billion as of December 31, 2015 . D. Derivative Financial Instruments and Hedging Activities Foreign Exchange Risk As of April 3, 2016 , the aggregate notional amount of foreign exchange derivative financial instruments hedging or offsetting foreign currency exposures was $36.9 billion . The derivative financial instruments primarily hedge or offset exposures in the euro, Japanese yen and U.K. pound. The maximum length of time over which we are hedging future foreign exchange cash flow relates to our 2.1 billion U.K. pound debt maturing in 2038. Interest Rate Risk As of April 3, 2016 , the aggregate notional amount of interest rate derivative financial instruments was $20.1 billion . The derivative financial instruments primarily hedge U.S. dollar and euro fixed-rate debt. The following table provides information about the gains/(losses) incurred to hedge or offset operational foreign exchange or interest rate risk: Three Months Ended Amount of Gains/(Losses) Recognized in OID (a), (b), (c) Amount of Gains/(Losses) Recognized in OCI (Effective Portion) (a), (d) Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) (a), (d) (MILLIONS OF DOLLARS) April 3, March 29, April 3, March 29, April 3, March 29, Derivative Financial Instruments in Cash Flow Hedge Relationships: Foreign currency swaps $ — $ — $ 55 $ (732 ) $ 118 $ (607 ) Foreign currency forward-exchange contracts 1 — (328 ) 417 221 373 Derivative Financial Instruments in Net Investment Hedge Relationships: Foreign currency forward-exchange contracts (2 ) 2 (12 ) 249 — — Derivative Financial Instruments Not Designated as Hedges: Foreign currency forward-exchange contracts (1 ) (41 ) — — — — Foreign currency swaps (23 ) 1 — — — — Non-Derivative Financial Instruments in Net Investment Hedge Relationships: Foreign currency short-term borrowings — — (26 ) — — — Foreign currency long-term debt — — — (3 ) — — $ (25 ) $ (38 ) $ (311 ) $ (68 ) $ 339 $ (234 ) (a) OID = Other (income)/deductions—net, included in Other (income)/deductions—net in the condensed consolidated statements of income . OCI = Other comprehensive income/(loss), included in the condensed consolidated statements of comprehensive income . (b) Also, includes gains and losses attributable to derivative instruments designated and qualifying as fair value hedges, as well as the offsetting gains and losses attributable to the hedged items in such hedging relationships. (c) There was no significant ineffectiveness for any period presented. (d) For derivative financial instruments in cash flow hedge relationships, the effective portion is included in Other comprehensive loss––Unrealized holding losses on derivative financial instruments, net . For derivative financial instruments in net investment hedge relationships and for foreign currency debt designated as hedging instruments, the effective portion is included in Other comprehensive loss––Foreign currency translation adjustments, net. For information about the fair value of our derivative financial instruments, and the impact on our condensed consolidated balance sheets, see Note 7A above . Certain of our derivative instruments are covered by associated credit-support agreements that have credit-risk-related contingent features designed to reduce our counterparties’ exposure to our risk of defaulting on amounts owed. As of April 3, 2016 , the aggregate fair value of these derivative instruments that are in a net liability position was $817 million , for which we have posted collateral of $897 million in the normal course of business. These features include the requirement to pay additional collateral in the event of a downgrade in our debt ratings. If there had been a downgrade to below an A rating by Standard and Poor ’ s (S&P) or the equivalent rating by Moody ’ s Investors Service, on April 3, 2016 , we would have been required to post an additional $13 million of collateral to our counterparties. The collateral advanced receivables are reported in Short-term investments. E. Credit Risk On an ongoing basis, we review the creditworthiness of counterparties to our foreign exchange and interest rate agreements and do not expect to incur a significant loss from failure of any counterparties to perform under the agreements. There are no significant concentrations of credit risk related to our financial instruments with any individual counterparty. As of April 3, 2016 , we had $2.2 billion due from a well-diversified, highly rated group (S&P ratings of mostly A or better) of bank counterparties around the world. For details about our investments, see Note 7B above. In general, there is no requirement for collateral from customers. However, derivative financial instruments are executed under master netting agreements with financial institutions and these agreements contain provisions that provide for the ability for collateral payments, depending on levels of exposure, our credit rating and the credit rating of the counterparty. As of April 3, 2016 , we received cash collateral of $0.9 billion from various counterparties. The collateral primarily supports the approximate fair value of our derivative contracts. With respect to the collateral received, which is included in Cash and cash equivalents, the obligations are reported in Short-term borrowings, including current portion of long-term debt. |
Inventories
Inventories | 3 Months Ended |
Apr. 03, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The following table provides the components of Inventories : (MILLIONS OF DOLLARS) April 3, December 31, Finished goods $ 2,782 $ 2,714 Work-in-process 3,957 3,932 Raw materials and supplies 840 867 Inventories $ 7,578 $ 7,513 Noncurrent inventories not included above (a) $ 644 $ 594 (a) Included in Other noncurrent assets . There are no recoverability issues associated with these amounts. |
Identifiable Intangible Assets
Identifiable Intangible Assets and Goodwill | 3 Months Ended |
Apr. 03, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Identifiable Intangible Assets and Goodwill | Identifiable Intangible Assets and Goodwill A. Identifiable Intangible Assets Balance Sheet Information The following table provides the components of Identifiable intangible assets : April 3, 2016 December 31, 2015 (MILLIONS OF DOLLARS) Gross Carrying Amount Accumulated Amortization Identifiable Intangible Assets, less Accumulated Amortization Gross Carrying Amount Accumulated Amortization Identifiable Intangible Assets, less Accumulated Amortization Finite-lived intangible assets Developed technology rights $ 77,630 $ (48,088 ) $ 29,543 $ 77,613 $ (47,193 ) $ 30,419 Brands 2,103 (956 ) 1,147 1,973 (928 ) 1,044 Licensing agreements and other 1,772 (931 ) 841 1,619 (918 ) 701 81,505 (49,975 ) 31,530 81,205 (49,040 ) 32,165 Indefinite-lived intangible assets Brands and other 6,893 6,893 7,021 7,021 In-process research and development 1,179 1,179 1,171 1,171 8,072 8,072 8,192 8,192 Identifiable intangible assets (a) $ 89,577 $ (49,975 ) $ 39,602 $ 89,396 $ (49,040 ) $ 40,356 (a) The decrease in I dentifiable intangible assets, less accumulated amortization , is primarily related to amortization, partially offset by assets acquired, the impact of measurement period adjustments related to our acquisition of Hospira (see Note 2A ) and the impact of foreign exchange. Our identifiable intangible assets are associated with the following, as a percentage of total identifiable intangible assets, less accumulated amortization: April 3, 2016 GIP VOC GEP WRD Developed technology rights 21 % 29 % 50 % — % Brands, finite-lived — % 73 % 27 % — % Brands, indefinite-lived — % 71 % 29 % — % In-process research and development 2 % 10 % 85 % 3 % Amortization Amortization expense related to finite-lived acquired intangible assets that contribute to our ability to sell, manufacture, research, market and distribute products, compounds and intellectual property is included in Amortization of intangible assets, as these intangible assets benefit multiple business functions. Amortization expense related to intangible assets that are associated with a single function is included in Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses , as appropriate. Total amortization expense for finite-lived intangible assets was $1.0 billion for the first quarter of 2016 and $1.0 billion for the first quarter of 2015 . I n-Process Research and Development For IPR&D assets, the risk of failure is significant and there can be no certainty that these assets ultimately will yield successful products. The nature of the biopharmaceutical business is high-risk and, as such, we expect that many of these IPR&D assets will become impaired and be written off at some time in the future. B. Goodwill The following table provides the components of and changes in the carrying amount of Goodwill : (MILLIONS OF DOLLARS) GIP VOC GEP Total Balance, December 31, 2015 $ 12,689 $ 11,120 $ 24,433 $ 48,242 Additions — 51 26 78 Other (a) 76 60 102 238 Balance, April 3, 2016 $ 12,765 $ 11,231 $ 24,562 $ 48,558 (a) Primarily reflects the impact of foreign exchange. |
Pension and Postretirement Bene
Pension and Postretirement Benefit Plans | 3 Months Ended |
Apr. 03, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Pension and Postretirement Benefit Plans | Pension and Postretirement Benefit Plans The following table provides the components of net periodic benefit cost: Three Months Ended Pension Plans U.S. Qualified (a) U.S. Supplemental (Non-Qualified) (b) International (c) Postretirement Plans (d) (MILLIONS OF DOLLARS) Apr 3, Mar 29, Apr 3, Mar 29, Apr 3, Mar 29, Apr 3, Mar 29, Net periodic benefit cost/(credit): Service cost (e) $ 63 $ 72 $ 5 $ 6 $ 42 $ 48 $ 10 $ 14 Interest cost (e) 134 169 12 14 60 79 22 32 Expected return on plan assets (241 ) (272 ) — — (98 ) (106 ) (8 ) (13 ) Amortization of: Actuarial losses 99 83 9 12 23 32 7 9 Prior service credits 1 (2 ) — — — (2 ) (41 ) (31 ) Curtailments 2 2 — — — — (6 ) (10 ) Settlements 15 26 10 15 1 — — — $ 73 $ 78 $ 35 $ 45 $ 27 $ 51 $ (16 ) $ 1 (a) The decrease in net periodic benefit costs for the three months ended April 3, 2016 , compared to the three months ended March 29, 2015 , for our U.S. qualified pension plans was primarily driven by (i) lower service and interest costs, resulting from a change in methodology for measuring service and interest costs (see (e) below) and (ii) lower settlement activity. The aforementioned decreases were partially offset by (i) a lower expected return on plan assets resulting from a net decrease of approximately $1.1 billion in the asset base due in part to lump-sum payments made in 2015 to certain terminated colleagues to settle Pfizer’s pension obligation, partially offset by a voluntary contribution of $1.0 billion made at the beginning of January 2016 and (ii) an increase in the amounts amortized for actuarial losses. (b) The decrease in net periodic benefit costs for the three months ended April 3, 2016, compared to the three months ended March 29, 2015, for our U.S. non-qualified pension plans was primarily driven by (i) lower settlement activity and (ii) a decrease in the amounts amortized for actuarial losses resulting from the increase, in 2015, in the discount rate used to determine the benefit obligation. (c) The decrease in net periodic benefit costs for the three months ended April 3, 2016 , compared to the three months ended March 29, 2015 , for our international pension plans was primarily driven by (i) lower service and interest costs, resulting from foreign exchange rate changes and a change in methodology for measuring service and interest costs (see (e) below), and (ii) a decrease in the amounts amortized for actuarial losses resulting from large gains in 2015, which decreased the plan net loss position, partially offset by (i) a decrease in the expected return on plan assets due to a lower expected rate of return on plan assets, and foreign exchange rates changes. (d) The decrease in net periodic benefit costs for the three months ended April 3, 2016 , compared to the three months ended March 29, 2015 , for our postretirement plans was primarily driven by (i) lower service and interest costs, resulting from a change in methodology for measuring service and interest costs (see (e) below) and (ii) an increase in prior service credits due to the postretirement medical plan cap changes during 2015. The aforementioned changes were partially offset by (i) a decrease in expected return on plan assets, primarily resulting from a decrease in plan assets reflecting Internal Revenue Code 401(h) reimbursements to Pfizer for eligible 2014 and 2015 prescription drug expenses for certain retirees, and (ii) lower curtailment gains. (e) Effective January 1, 2016, the Company changed the approach used to measure service and interest costs for U.S. and certain international pension and other postretirement benefits. For fiscal 2015, the Company measured service and interest costs utilizing a single weighted-average discount rate derived from the bond model or yield curve used to measure the respective plan obligations. For fiscal 2016, we elected to measure service and interest costs by applying the spot rates along the yield curve, or a yield curve implied from the bond model, to the plans' liability cash flows. The Company believes the new approach provides a more precise measurement of service and interest costs by aligning the timing of the plans’ liability cash flows to the corresponding spot rates on the yield curve. This change does not affect the measurement of our plan obligations. We have accounted for this change as a change in accounting estimate and, accordingly, have accounted for it on a prospective basis. The expected reduction in expense for 2016 associated with this change in estimate is $191 million , which is expected to be recognized evenly over each quarter of the year. As of and for the three months ended April 3, 2016 , we contributed and expect to contribute from our general assets as follows: Pension Plans (MILLIONS OF DOLLARS) U.S. Qualified U.S. Supplemental (Non-Qualified) International Postretirement Plans Contributions from/reimbursements of our general assets for the three months ended April 3, 2016 (a) $ 1,000 $ 70 $ 50 $ (148 ) Expected contributions from our general assets during 2016 (b) $ 1,000 $ 126 $ 174 $ (6 ) (a) Contributions to the postretirement plans reflect Internal Revenue Code 401(h) reimbursements totaling $198 million received for eligible 2014 and 2015 prescription drug expenses for certain retirees. (b) Contributions expected to be made for 2016 are inclusive of amounts contributed during the three months ended April 3, 2016 , including the $1.0 billion voluntary contribution that was made in January 2016 for the U.S. qualified plans, which was considered pre-funding for future anticipated mandatory contributions and is also expected to reduce Pension Benefit Guaranty Corporation variable rate premiums. The U.S. supplemental (non-qualified) pension plan, international pension plan and the postretirement plan contributions from our general assets include direct employer benefit payments. |
Earnings Per Common Share Attri
Earnings Per Common Share Attributable to Common Shareholders | 3 Months Ended |
Apr. 03, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share Attributable to Common Shareholders | Earnings Per Common Share Attributable to Common Shareholders The following table provides the detailed calculation of Earnings per common share (EPS) : Three Months Ended (IN MILLIONS) April 3, March 29, EPS Numerator––Basic Income from continuing operations $ 3,026 $ 2,376 Less: Net income attributable to noncontrolling interests 9 6 Income from continuing operations attributable to Pfizer Inc. 3,016 2,371 Less: Preferred stock dividends––net of tax — — Income from continuing operations attributable to Pfizer Inc. common shareholders 3,016 2,370 Discontinued operations––net of tax — 5 Less: Discontinued operations––net of tax, attributable to noncontrolling interests — — Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders — 5 Net income attributable to Pfizer Inc. common shareholders $ 3,016 $ 2,375 EPS Numerator––Diluted Income from continuing operations attributable to Pfizer Inc. common shareholders and assumed conversions $ 3,016 $ 2,371 Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders and assumed conversions — 5 Net income attributable to Pfizer Inc. common shareholders and assumed conversions $ 3,016 $ 2,376 EPS Denominator Weighted-average number of common shares outstanding––Basic 6,150 6,203 Common-share equivalents: stock options, stock issuable under employee compensation plans, convertible preferred stock and accelerated share repurchase agreements 64 90 Weighted-average number of common shares outstanding––Diluted 6,214 6,292 Stock options that had exercise prices greater than the average market price of our common stock issuable under employee compensation plans (a) 86 34 (a) These common stock equivalents were outstanding for the three months ended April 3, 2016 and March 29, 2015 , but were not included in the computation of diluted EPS for those periods because their inclusion would have had an anti-dilutive effect. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Apr. 03, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We and certain of our subsidiaries are subject to numerous contingencies arising in the ordinary course of business. For a discussion of our tax contingencies, see Note 5B. On March 8, 2016, we entered into an accelerated share repurchase agreement with Goldman, Sachs & Co. (GS&Co.) to repurchase $5 billion of our common stock. Pursuant to the terms of the agreement, on March 10, 2016, we paid $5 billion to GS&Co. and received an initial delivery of approximately 136 million shares of our common stock from GS&Co. at a price of $29.36 per share, which represented, based on the closing share price of our common stock on the New York Stock Exchange on March 8, 2016, approximately 80% of the notional amount of the accelerated share repurchase agreement. As of April 3, 2016 , the common stock received is included in Treasury Stock. At settlement of the agreement, which is expected to occur during the second quarter of 2016, GS&Co. may be required to deliver additional shares of common stock to us, or, under certain circumstances, we may be required to deliver shares of our common stock or may elect to make a cash payment to GS&Co., with the number of shares to be delivered or the amount of such payment, as well as the final average price per share, based on the volume-weighted average price, less a discount, of Pfizer's common stock during the term of the transaction. This agreement was entered into pursuant to our previously announced share repurchase authorization. After giving effect to the accelerated share repurchase agreement, our remaining share-purchase authorization was approximately $11.4 billion at April 3, 2016. A. Legal Proceedings Our non-tax contingencies include, but are not limited to, the following: • Patent litigation, which typically involves challenges to the coverage and/or validity of our patents on various products, processes or dosage forms. We are the plaintiff in the vast majority of these actions. An adverse outcome in actions in which we are the plaintiff could result in a loss of patent protection for the drug at issue, a significant loss of revenues from that drug and impairments of any associated assets. • Product liability and other product-related litigation, which can include personal injury, consumer, off-label promotion, securities, antitrust and breach of contract claims, among others, often involves highly complex issues relating to medical causation, label warnings and reliance on those warnings, scientific evidence and findings, actual, provable injury and other matters. • Commercial and other matters, which can include merger-related and product-pricing claims and environmental claims and proceedings, can involve complexities that will vary from matter to matter. • Government investigations, which often are related to the extensive regulation of pharmaceutical companies by national, state and local government agencies in the U.S. and in other countries. Certain of these contingencies could result in losses, including damages, fines and/or civil penalties, and/or criminal charges, which could be substantial. We believe that our claims and defenses in these matters are substantial, but litigation is inherently unpredictable and excessive verdicts do occur. We do not believe that any of these matters will have a material adverse effect on our financial position. However, we could incur judgments, enter into settlements or revise our expectations regarding the outcome of certain matters, and such developments could have a material adverse effect on our results of operations in the period in which the amounts are accrued and/or our cash flows in the period in which the amounts are paid. We have accrued for losses that are both probable and reasonably estimable. Substantially all of our contingencies are subject to significant uncertainties and, therefore, determining the likelihood of a loss and/or the measurement of any loss can be complex. Consequently, we are unable to estimate the range of reasonably possible loss in excess of amounts accrued. Our assessments are based on estimates and assumptions that have been deemed reasonable by management, but the assessment process relies heavily on estimates and assumptions that may prove to be incomplete or inaccurate, and unanticipated events and circumstances may occur that might cause us to change those estimates and assumptions. Amounts recorded for legal and environmental contingencies can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. The principal pending matters to which we are a party are discussed below. In determining whether a pending matter is a principal matter, we consider both quantitative and qualitative factors in order to assess materiality, such as, among other things, the amount of damages and the nature of any other relief sought in the proceeding, if such damages and other relief are specified; our view of the merits of the claims and of the strength of our defenses; whether the action purports to be a class action and our view of the likelihood that a class will be certified by the court; the jurisdiction in which the proceeding is pending; any experience that we or, to our knowledge, other companies have had in similar proceedings; whether disclosure of the action would be important to a reader of our financial statements, including whether disclosure might change a reader’s judgment about our financial statements in light of all of the information about the Company that is available to the reader; the potential impact of the proceeding on our reputation; and the extent of public interest in the matter. In addition, with respect to patent matters, we consider, among other things, the financial significance of the product protected by the patent. As a result of considering qualitative factors in our determination of principal matters, there are some matters discussed below with respect to which management believes that the likelihood of possible loss in excess of amounts accrued is remote. A1. Legal Proceedings––Patent Litigation Like other pharmaceutical companies, we are involved in numerous suits relating to our patents, including but not limited to, those discussed below. Most of the suits involve claims by generic drug manufacturers that patents covering our products, processes or dosage forms are invalid and/or do not cover the product of the generic drug manufacturer. Also, counterclaims, as well as various independent actions, have been filed alleging that our assertions of, or attempts to enforce, our patent rights with respect to certain products constitute unfair competition and/or violations of antitrust laws. In addition to the challenges to the U.S. patents on a number of our products that are discussed below, we note that the patent rights to certain of our products are being challenged in various other countries. We are also party to other patent damages suits in various jurisdictions pursuant to which generic drug manufacturers, payers, governments or other parties are seeking damages from us for alleged delay of generic entry related to patent enforcement litigation. Additionally, our licensing and collaboration partners face challenges by generic drug manufacturers to patents covering several of their products that may impact our licenses or co-promotion rights to such products. We are also subject to patent litigation pursuant to which one or more third parties is seeking damages and/or injunctive relief to compensate for the alleged infringement of its patents due to our commercial or other activities. For example, our subsidiary, Hospira, is involved in patent and patent-related disputes over its attempts to bring generic pharmaceutical and biosimilar products to market. If the marketed product is ultimately found to infringe the valid patent rights of a third party, such third party may be awarded significant damages, or we may be prevented from further sales of such product. Such damages may be enhanced as much as three-fold in the event that we or one of our subsidiaries, like Hospira, is found to have willfully infringed the valid patent rights of a third party. Actions In Which We Are The Plaintiff EpiPen In July 2010, King Pharmaceuticals, Inc. (King), which we acquired in 2011 and is a wholly owned subsidiary, brought a patent-infringement action against Sandoz, Inc., a division of Novartis AG (Sandoz), in the U.S. District Court for the District of New Jersey in connection with Sandoz’s abbreviated new drug application filed with the FDA seeking approval to market an epinephrine injectable product. Sandoz is challenging patents, which expire in 2025, covering the next-generation autoinjector for use with epinephrine that is sold under the EpiPen brand name. Toviaz (fesoterodine) We have an exclusive, worldwide license to market Toviaz from UCB Pharma GmbH, which owns the patents relating to Toviaz. Beginning in May 2013, several generic drug manufacturers notified us that they had filed abbreviated new drug applications with the FDA seeking approval to market generic versions of Toviaz and asserting the invalidity, unenforceability and/or non-infringement of all of our patents for Toviaz that are listed in the FDA’s list of Approved Drug Products with Therapeutic Equivalence Evaluations, commonly referred to as the “Orange Book”. Beginning in June 2013, we filed actions against all of those generic drug manufacturers in the U.S. District Court for the District of Delaware, asserting the infringement of five of the patents for Toviaz: three composition-of-matter patents and a method-of-use patent that expire in 2019, and a patent covering salts of fesoterodine that expires in 2022. In June and July 2015, we settled with four of the eight generic defendants. The trial relating to the remaining defendants occurred in July 2015. In April 2016, the District Court held that the patents that were the subject of the lawsuit were valid and infringed. Tygacil (tigecycline) In October 2013, we received notice of a Section 505(b)(2) new drug application filed by Fresenius Kabi USA LLC (Fresenius) for a tigecycline injectable product. Fresenius asserts the invalidity and non-infringement of the basic patent for Tygacil that expired in April 2016, the formulation patent for Tygacil that expires in 2029 and the polymorph patent for Tygacil that expires in 2030. In November 2013, we filed suit against Fresenius in the U.S. District Court for the District of Delaware asserting the validity and infringement of the patents that are the subject of the lawsuit. In November 2015, we settled our claims against Fresenius on terms that permit Fresenius to launch a tigecycline injectable product in the U.S. prior to the expiration of certain of the patents that were the subject of the challenge. In November 2014, Mylan Laboratories Limited (formerly Agila Specialties Private Limited) (Mylan Laboratories) notified us that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Tygacil. Mylan Laboratories asserts the invalidity and non-infringement of the polymorph patent for Tygacil and the formulation patent for Tygacil. Mylan Laboratories has not challenged the basic patent. In January 2015, we filed suit against Mylan Laboratories in the U.S. District Court for the District of Delaware, asserting the validity and infringement of the polymorph patent and the formulation patent for Tygacil. In addition, in September 2015 and December 2015, we received notices of Section 505(b)(2) new drug applications filed by each of Mylan and Accord Healthcare Inc. (Accord) for tigecycline injectable products. Mylan and Accord assert the invalidity and non-infringement of the polymorph patent for Tygacil, and two formulation patents for Tygacil that expire in 2028 and 2029, respectively. In October 2015, we filed suit against Mylan in the U.S. District Court for the District of Delaware and in the U.S. District Court for the District of West Virginia asserting the validity and infringement of the patents that are the subject of the lawsuit. In February 2016, we filed suit against Accord in the U.S. District Court for the District of Delaware and in the U.S. District Court for the Middle District of North Carolina asserting the validity and infringement of the patents that are the subject of the lawsuit. Precedex Premix In June 2014, Ben Venue Laboratories, Inc. (Ben Venue) notified our subsidiary, Hospira, that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that a patent relating to the use of Precedex in an intensive care unit setting, which expires in March 2019, was invalid or not infringed. In August 2014, Hospira and Orion Corporation (co-owner of the patent that is the subject of the lawsuit) filed suit against Ben Venue, Hikma Pharmaceuticals PLC (Hikma), and West-Ward Pharmaceutical Corp. in the U.S. District Court for the District of Delaware asserting the validity and infringement of the patent that is the subject of the lawsuit. In October 2014, Eurohealth International Sarl was substituted for Ben Venue and Hikma. In June 2015, Amneal Pharmaceuticals LLC (Amneal) notified Hospira that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that four patents relating to the Precedex premix formulations and their use, all of which expire in 2032, were invalid or not infringed. In August 2015, Hospira filed suit against Amneal in the U.S. District Court for the District of Delaware asserting the validity and infringement of the patents that are the subject of the lawsuit. In December 2015, Fresenius notified Hospira that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that four patents relating to the Precedex premix formulations and their use, all of which expire in 2032, were invalid or not infringed. In January 2016, Hospira filed suit against Fresenius in the U.S. District Court for the Northern District of Illinois asserting the validity and infringement of the patents that are the subject of the lawsuit. Matter Involving Our Collaboration/Licensing Partners Nexium 24HR (esomeprazole) We have an exclusive license from AstraZeneca PLC (AstraZeneca) to market in the U.S. the over-the-counter (OTC) version of Nexium (Nexium 24HR). Beginning in October 2014, Actavis Laboratories FL, Inc., and subsequently Andrx Labs, LLC (Andrx), Perrigo Company plc (Perrigo), Lupin Limited and, in October 2015, Dr. Reddy’s Laboratories, Inc. & Ltd. (Dr. Reddy’s) notified us that they had filed abbreviated new drug applications with the FDA seeking approval to market generic versions of Nexium 24HR prior to the expiration of one or more of AstraZeneca’s patents listed in the Orange Book for Nexium 24HR. From November 2014 through November 2015, AstraZeneca filed actions against each of Actavis Laboratories FL, Inc., Andrx, Perrigo, Lupin Limited and Dr. Reddy’s in the U.S. District Court for the District of New Jersey asserting the infringement of the challenged patents. We are not a party to AstraZeneca’s patent-infringement actions. Action In Which We Are The Defendant Effexor XR (venlafaxine HCI) In 2006, Wyeth and Wyeth Canada Limited (the Wyeth companies) filed an action in the Federal Court in Canada against Ratiopharm Inc. (Ratiopharm) seeking to prevent Ratiopharm from obtaining approval in Canada for its generic version of Effexor XR prior to the expiration of one of the Wyeth companies’ patents. As a result of that action, Ratiopharm was enjoined from obtaining regulatory approval for its generic product. However, in August 2007, the Federal Court of Appeal in Canada ruled that the patent at issue could not be asserted against Ratiopharm under the applicable Canadian regulations governing approvals, and it dismissed the Wyeth companies’ action. Following the dismissal, in 2007, Ratiopharm filed an action in the Federal Court in Canada seeking damages from the Wyeth companies for preventing Ratiopharm from marketing its generic version of Effexor XR in Canada from January 2006 through August 2007. The Federal Court dismissed Ratiopharm’s action in 2011, but the Federal Court of Appeal reinstated it in 2012. In 2011 and 2012, Pfizer made payments to Teva Canada Limited, which had acquired Ratiopharm, totaling Canadian dollars 52.5 million in partial settlement of this action. The trial in this action was held in January 2014, and the court issued various findings in March 2014. On June 30, 2014, the Federal Court in Canada issued a judgment based on those findings, awarding Teva Canada Limited damages of approximately Canadian dollars 125 million , consisting of compensatory damages, pre-judgment interest and legal costs. This judgment was satisfied by Pfizer Canada Inc., as successor to the Wyeth companies, in July 2014. In September 2014, Pfizer Canada Inc. appealed the judgment. A2. Legal Proceedings––Product Litigation Like other pharmaceutical companies, we are defendants in numerous cases, including but not limited to those discussed below, related to our pharmaceutical and other products. Plaintiffs in these cases seek damages and other relief on various grounds for alleged personal injury and economic loss. Asbestos Between 1967 and 1982, Warner-Lambert owned American Optical Corporation, which manufactured and sold respiratory protective devices and asbestos safety clothing. In connection with the sale of American Optical in 1982, Warner-Lambert agreed to indemnify the purchaser for certain liabilities, including certain asbestos-related and other claims. As of April 3, 2016 , approximately 55,350 claims naming American Optical and numerous other defendants were pending in various federal and state courts seeking damages for alleged personal injury from exposure to asbestos and other allegedly hazardous materials. Warner-Lambert was acquired by Pfizer in 2000 and is now a wholly owned subsidiary of Pfizer. Warner-Lambert is actively engaged in the defense of, and will continue to explore various means of resolving, these claims. Numerous lawsuits are pending against Pfizer in various federal and state courts seeking damages for alleged personal injury from exposure to products containing asbestos and other allegedly hazardous materials sold by Gibsonburg Lime Products Company (Gibsonburg). Gibsonburg was acquired by Pfizer in the 1960s and sold products containing small amounts of asbestos until the early 1970s. There also are a small number of lawsuits pending in various federal and state courts seeking damages for alleged exposure to asbestos in facilities owned or formerly owned by Pfizer or its subsidiaries. Celebrex and Bextra Beginning in late 2004, several purported class actions were filed in federal and state courts alleging that Pfizer and certain of our current and former officers violated federal securities laws by misrepresenting the safety of Celebrex and Bextra. In June 2005, the federal actions were transferred for consolidated pre-trial proceedings to a Multi-District Litigation ( In re Pfizer Inc. Securities, Derivative and “ERISA” Litigation MDL-1688 ) in the U.S. District Court for the Southern District of New York. In March 2012, the court in the Multi-District Litigation certified a class consisting of all persons who purchased or acquired Pfizer stock between October 31, 2000 and October 19, 2005. In May 2014, the court in the Multi-District Litigation granted Pfizer’s motion to exclude the testimony of the plaintiffs’ loss causation and damages expert. We subsequently filed a motion for summary judgment seeking dismissal of the litigation, and the plaintiffs filed a motion for leave to submit an amended report by their expert. In July 2014, the court denied the plaintiffs’ motion for leave to submit an amended report, and granted our motion for summary judgment, dismissing the plaintiffs’ claims in their entirety. In August 2014, the plaintiffs appealed the District Court’s decision to the U.S. Court of Appeals for the Second Circuit. In April 2016, the U.S. Court of Appeals for the Second Circuit reversed the District Court’s decision and remanded the case to the District Court for further proceedings. Effexor • Personal Injury Actions A number of individual lawsuits and multi-plaintiff lawsuits have been filed against us and/or our subsidiaries in various federal and state courts alleging personal injury as a result of the purported ingestion of Effexor. Among other types of actions, the Effexor personal injury litigation includes actions alleging a variety of birth defects as a result of the purported ingestion of Effexor by women during pregnancy. Plaintiffs in these birth-defect actions seek compensatory and punitive damages. In August 2013, the federal birth-defect cases were transferred for consolidated pre-trial proceedings to a Multi-District Litigation ( In re Effexor ( Venlafaxine Hydrochloride) Products Liability Litigation MDL-2458 ) in the U.S. District Court for the Eastern District of Pennsylvania. Almost all plaintiffs have voluntarily dismissed their actions. The Multi-District Litigation, as well as the coordinated state court proceedings in California, have been administratively stayed. • Antitrust Actions Beginning in May 2011, actions, including purported class actions, were filed in various federal courts against Wyeth and, in certain of the actions, affiliates of Wyeth and certain other defendants relating to Effexor XR, which is the extended-release formulation of Effexor. The plaintiffs in each of the class actions seek to represent a class consisting of all persons in the U.S. and its territories who directly purchased, indirectly purchased or reimbursed patients for the purchase of Effexor XR or generic Effexor XR from any of the defendants from June 14, 2008 until the time the defendants’ allegedly unlawful conduct ceased. The plaintiffs in all of the actions allege delay in the launch of generic Effexor XR in the U.S. and its territories, in violation of federal antitrust laws and, in certain of the actions, the antitrust, consumer protection and various other laws of certain states, as the result of Wyeth fraudulently obtaining and improperly listing certain patents for Effexor XR in the Orange Book, enforcing certain patents for Effexor XR and entering into a litigation settlement agreement with a generic drug manufacturer with respect to Effexor XR. Each of the plaintiffs seeks treble damages (for itself in the individual actions or on behalf of the putative class in the purported class actions) for alleged price overcharges for Effexor XR or generic Effexor XR in the U.S. and its territories since June 14, 2008. All of these actions have been consolidated in the U.S. District Court for the District of New Jersey. In October 2014, the District Court dismissed the direct purchaser plaintiffs’ claims based on the litigation settlement agreement, but declined to dismiss the other direct purchaser plaintiff claims. In January 2015, the District Court entered partial final judgments as to all settlement agreement claims, including those asserted by direct purchasers and end-payer plaintiffs, which plaintiffs have appealed to the U.S. Court of Appeals for the Third Circuit. Motions to dismiss remain pending as to the end-payer plaintiffs’ remaining claims. Zoloft A number of individual lawsuits and multi-plaintiff lawsuits have been filed against us and/or our subsidiaries in various federal and state courts alleging personal injury as a result of the purported ingestion of Zoloft. Among other types of actions, the Zoloft personal injury litigation includes actions alleging a variety of birth defects as a result of the purported ingestion of Zoloft by women during pregnancy. Plaintiffs in these birth-defect actions seek compensatory and punitive damages and the disgorgement of profits resulting from the sale of Zoloft. In April 2012, the federal birth-defect cases were transferred for consolidated pre-trial proceedings to a Multi-District Litigation ( In re Zoloft Products Liability Litigation MDL-2342 ) in the U.S. District Court for the Eastern District of Pennsylvania. A number of plaintiffs have voluntarily dismissed their actions. In April 2016, the District Court granted our motion for summary judgment, dismissing the claims of almost all of the remaining plaintiffs. Lipitor • Whistleblower Action In 2004, a former employee filed a “whistleblower” action against us in the U.S. District Court for the Eastern District of New York. The complaint remained under seal until September 2007, at which time the U.S. Attorney for the Eastern District of New York declined to intervene in the case. We were served with the complaint in December 2007. Plaintiff alleges off-label promotion of Lipitor in violation of the Federal Civil False Claims Act and the false claims acts of certain states, and he seeks treble damages and civil penalties on behalf of the federal government and the specified states as the result of their purchase, or reimbursement of patients for the purchase, of Lipitor allegedly for such off-label uses. Plaintiff also seeks compensation as a whistleblower under those federal and state statutes. In addition, plaintiff alleges that he was wrongfully terminated, in violation of the anti-retaliation provisions of applicable federal and New York law, and he seeks damages and the reinstatement of his employment. In 2009, the District Court dismissed without prejudice the off-label promotion claims and, in 2010, plaintiff filed an amended complaint containing off-label promotion allegations that are substantially similar to the allegations in the original complaint. In November 2012, the District Court dismissed the amended complaint. In December 2012, plaintiff appealed the District Court’s decision to the U.S. Court of Appeals for the Second Circuit. In August 2014, the U.S. Court of Appeals for the Second Circuit dismissed the appeal for lack of jurisdiction and sent the case back to the District Court for clarification of its ruling regarding the plaintiff’s employment claims. In November 2014, the District Court granted plaintiff’s motion for a partial final judgment certifying the dismissal of the false claims counts, and plaintiff appealed the order dismissing those claims to the U.S. Court of Appeals for the Second Circuit. • Antitrust Actions Beginning in November 2011, purported class actions relating to Lipitor were filed in various federal courts against, among others, Pfizer, certain affiliates of Pfizer, and, in most of the actions, Ranbaxy, Inc. (Ranbaxy) and certain affiliates of Ranbaxy. The plaintiffs in these various actions seek to represent nationwide, multi-state or statewide classes consisting of persons or entities who directly purchased, indirectly purchased or reimbursed patients for the purchase of Lipitor (or, in certain of the actions, generic Lipitor) from any of the defendants from March 2010 until the cessation of the defendants’ allegedly unlawful conduct (the Class Period). The plaintiffs allege delay in the launch of generic Lipitor, in violation of federal antitrust laws and/or state antitrust, consumer protection and various other laws, resulting from (i) the 2008 agreement pursuant to which Pfizer and Ranbaxy settled certain patent litigation involving Lipitor, and Pfizer granted Ranbaxy a license to sell a generic version of Lipitor in various markets beginning on varying dates, and (ii) in certain of the actions, the procurement and/or enforcement of certain patents for Lipitor. Each of the actions seeks, among other things, treble damages on behalf of the putative class for alleged price overcharges for Lipitor (or, in certain of the actions, generic Lipitor) during the Class Period. In addition, individual actions have been filed against Pfizer, Ranbaxy and certain of their affiliates, among others, that assert claims and seek relief for the plaintiffs that are substantially similar to the claims asserted and the relief sought in the purported class actions described above. These various actions have been consolidated for pre-trial proceedings in a Multi-District Litigation (MDL) ( In re Lipitor Antitrust Litigation MDL-2332 ) in the U.S. District Court for the District of New Jersey. In September 2013 and 2014, the District Court dismissed with prejudice the claims by direct purchasers. In October and November 2014, the District Court dismissed with prejudice the claims of all other MDL plaintiffs. All plaintiffs have appealed the District Court’s orders dismissing their claims with prejudice to the United States Court of Appeals for the Third Circuit. In addition, the direct purchaser class plaintiffs appealed the order denying their motion to amend the judgment and for leave to amend their complaint to the U.S. Court of Appeals for the Third Circuit. Also, in January 2013, the State of West Virginia filed an action in West Virginia state court against Pfizer and Ranbaxy, among others, that asserts claims and seeks relief on behalf of the State of West Virginia and residents of that state that are substantially similar to the claims asserted and the relief sought in the purported class actions described above. • Personal Injury Actions A number of individual and multi-plaintiff lawsuits have been filed against us in various federal and state courts alleging that the plaintiffs developed type 2 diabetes as a result of the purported ingestion of Lipitor. Plaintiffs seek compensatory and punitive damages. In February 2014, the federal actions were transferred for consolidated pre-trial proceedings to a Multi-District Litigation ( In re Lipitor (Atorvastatin Calcium) Marketing, Sales Practices and Products Liability Litigation (No. II) MDL-2502 ) in the U.S. District Court for the District of South Carolina. Viagra A number of individual and multi-plaintiff lawsuits have been filed against us in various federal and state courts alleging that the plaintiffs developed melanoma and/or the exacerbation of melanoma as a result of the purported ingestion of Viagra. Plaintiffs seek compensatory and punitive damages. In April 2016, the federal actions were transferred for coordinated pre-trial proceedings to a Multi-District Litigation ( In Re: Viagra (Sildenafil Citrate) Products Liability Litigation, MDL-2691 ) in the U.S. District Court for the Northern District of California. Chantix/Champix Beginning in December 2008, purported class actions were filed against us in the Ontario Superior Court of Justice (Toronto Region), the Superior Court of Quebec (District of Montreal), the Court of Queen’s Bench of Alberta, Judicial District of Calgary, and the Superior Court of British Columbia (Vancouver Registry) on behalf of all individuals and third-party payers in Canada who have purchased and ingested Champix or reimbursed patients for the purchase of Champix. Each of these actions asserts claims under Canadian product liability law, including with respect to the safety and efficacy of Champix, and, on behalf of the putative class, seeks monetary relief, including punitive damages. In June 2012, the Ontario Superior Court of Justice certified the Ontario proceeding as a class action, defining the class as consisting of the following: (i) all persons in Canada who ingested Champix during the period from April 2, 2007 to May 31, 2010 and who experienced at least one of a number of specified neuropsychiatric adverse events; (ii) all persons who are entitled to assert claims in respect of Champix pursuant to Canadian legislation as the result of their relationship with a class member; and (iii) all health insurers who are entitled to assert claims in respect of Champix pursuant to Canadian legislation. The Ontario Superior Court of Justice certified the class against Pfizer Canada Inc. only and ruled that the action against Pfizer should be stayed until after the trial of the issues that are common to the class members. The actions in Quebec, Alberta and British Columbia have been stayed in favor of the Ontario action, which is proceeding on a national basis. Celebrex Beginning in July 2014, purported class actions were filed in the U.S. District Court for the Eastern District of Virginia against Pfizer and certain subsi |
Segment, Geographic and Other R
Segment, Geographic and Other Revenue Information | 3 Months Ended |
Apr. 03, 2016 | |
Segment Reporting [Abstract] | |
Segment, Geographic and Other Revenue Information | Segment, Geographic and Other Revenue Information A. Segment Information We manage our commercial operations through two distinct businesses: an Innovative Products business and an Established Products business. The Innovative Products business is composed of two operating segments, each of which had been led by a single manager in 2015––the Global Innovative Pharmaceutical segment (GIP) and the Global Vaccines, Oncology and Consumer Healthcare segment (VOC). Effective February 8, 2016, the Innovative Products business is led by a single manager. The Established Products business consists of the Global Established Pharmaceutical segment (GEP), which is also led by a single manager. Each operating segment has responsibility for its commercial activities and for certain IPR&D projects for new investigational products and additional indications for in-line products that generally have achieved proof-of-concept. Additionally, the new GEP Research and Development (R&D) organization is responsible for earlier stage research with support from our Worldwide Research and Development (WRD) organization. Each business has a geographic footprint across developed and emerging markets. We regularly review our segments and the approach used by management to evaluate performance and allocate resources. Operating Segments Some additional information about each business and operating segment follows: Innovative Products Business Established Products Business Global Innovative Pharmaceutical segment: GIP focuses on developing and commercializing novel, value-creating medicines that significantly improve patients’ lives. Key therapeutic areas include inflammation/immunology, cardiovascular/metabolic, neuroscience/pain and rare diseases and include leading brands, such as Xeljanz, Eliquis, Lyrica (U.S. and Japan), Enbrel (outside the U.S. and Canada) and Viagra (U.S. and Canada). Global Vaccines, Oncology and Consumer Healthcare segment: VOC focuses on the development and commercialization of vaccines and products for oncology and consumer healthcare. Consumer Healthcare manufactures and markets several well known, over-the-counter (OTC) products. Each of the three businesses in VOC operates as a separate, global business, with distinct specialization in terms of the science and market approach necessary to deliver value to consumers and patients. Global Established Pharmaceutical segment: GEP includes legacy brands that have lost or will soon lose market exclusivity in both developed and emerging markets, branded generics, generic sterile injectable products, biosimilars and infusion systems. Beginning in 2016, GEP includes a new GEP R&D organization as well as our contract manufacturing business. Effective as of the beginning of 2016, the following changes impact GEP: • Our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) the revenues and expenses of legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including the revenues and expenses related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) the revenues and expenses of legacy Hospira's One-2-One sterile injectables contract manufacturing operation, which has been included in GEP since we acquired Hospira on September 3, 2015. Prior to 2016, PCS was managed outside our operating segments as part of Pfizer Global Supply and reported as "Other Business Activities". We have reclassified prior period PCS operating results ( $111 million of PCS revenues and $21 million of PCS earnings in the first quarter of 2015) to conform to the current period presentation as part of GEP. • In connection with the formation of a new GEP R&D organization, certain functions transferred from Pfizer’s WRD organization into the new GEP R&D organization. The new R&D organization within GEP expects to develop potential new sterile injectable drugs and therapeutic solutions, as well as biosimilars. We have reclassified approximately $66 million of costs in the first quarter of 2015 from WRD to GEP to conform to the current period presentation as part of GEP. Our chief operating decision maker uses the revenues and earnings of the three operating segments, among other factors, for performance evaluation and resource allocation. Other Costs and Business Activities Certain costs are not allocated to our operating segment results, such as costs associated with the following: • WRD, which is generally responsible for research projects for our Innovative Products business until proof-of-concept is achieved and then for transitioning those projects to the appropriate Innovative Products operating segment via the newly formed Global Product Development Group for possible clinical and commercial development. R&D spending may include upfront and milestone payments for intellectual property rights. The WRD organization also has responsibility for certain science-based and other platform-services organizations, which provide technical expertise and other services to the various R&D projects, including GEP R&D projects. WRD is also responsible for facilitating all regulatory submissions and interactions with regulatory agencies, including all safety-event activities. • Pfizer Medical, which is responsible for the provision of medical information to healthcare providers, patients and other parties, transparency and disclosure activities, clinical trial results publication, grants for healthcare quality improvement and medical education, partnerships with global public health and medical associations, and regulatory inspection readiness reviews. • Corporate, representing platform functions (such as worldwide technology, global real estate operations, legal, finance, human resources, worldwide public affairs, compliance and worldwide procurement) and certain compensation and other corporate costs, such as interest income and expense, and gains and losses on investments. • Other unallocated costs, representing overhead expenses associated with our manufacturing and commercial operations not directly attributable to an operating segment. • Certain transactions and events such as (i) purchase accounting adjustments, where we incur expenses associated with the amortization of fair value adjustments to inventory, intangible assets and property, plant and equipment; (ii) acquisition-related costs, where we incur costs for executing the transaction, integrating the acquired operations and restructuring the combined company; and (iii) certain significant items, which include non-acquisition-related restructuring costs, as well as costs incurred for legal settlements, asset impairments and disposals of assets or businesses, including, as applicable, any associated transition activities. Segment Assets We manage our assets on a total company basis, not by operating segment, as many of our operating assets are shared (such as our plant network assets) or commingled (such as accounts receivable, as many of our customers are served by multiple operating segments). Therefore, our chief operating decision maker does not regularly review any asset information by operating segment and, accordingly, we do not report asset information by operating segment. Total assets were approximately $163 billion as of April 3, 2016 and approximately $167 billion as of December 31, 2015 . Selected Income Statement Information The following table provides selected income statement information by reportable segment: Three Months Ended Revenues Earnings (a) (MILLIONS OF DOLLARS) April 3, March 29, April 3, March 29, Reportable Segments: GIP $ 3,640 $ 3,075 $ 2,192 $ 1,511 VOC 3,394 2,664 1,835 1,464 GEP (b) 5,972 5,125 3,657 3,215 Total reportable segments 13,005 10,864 7,684 6,190 Other business activities (c) — — (619 ) (624 ) Reconciling Items: Corporate (c) — — (1,363 ) (1,287 ) Purchase accounting adjustments (c) — — (1,153 ) (903 ) Acquisition-related costs (c) — — (116 ) (23 ) Certain significant items (d) — — (638 ) (228 ) Other unallocated — — (234 ) (45 ) $ 13,005 $ 10,864 $ 3,561 $ 3,082 (a) Income from continuing operations before provision for taxes on income. (b) On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira commercial operations, including the legacy Hospira One-2-One contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. Effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) the revenues and expenses of legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including the revenues and expenses related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) the revenues and expenses of legacy Hospira's One-2-One sterile injectables contract manufacturing operation, which has been included in GEP since we acquired Hospira on September 3, 2015. Prior to 2016, PCS was managed outside our operating segments as part of Pfizer Global Supply and reported as "Other Business Activities". We have reclassified prior period PCS operating results ( $111 million of PCS revenues and $21 million of PCS earnings in the first quarter of 2015) to conform to the current period presentation as part of GEP. As noted above, also effective as of the beginning of 2016, in connection with the formation of a new GEP R&D organization, certain functions transferred from WRD into the new GEP R&D organization. We have reclassified approximately $66 million of costs in the first quarter of 2015 from WRD to GEP to conform to the current period presentation as part of GEP. (c) For a description, see the “Other Costs and Business Activities” section above. (d) Certain significant items are substantive, unusual items that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis. For Earnings in the first quarter of 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $137 million , (ii) charges for certain legal matters of $286 million , (iii) certain asset impairment charges of $131 million , (iv) charges for business and legal entity alignment of $51 million and (v) other charges of $34 million . For additional information, see Note 3 and Note 4. For Earnings in the first quarter of 2015, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $104 million , (ii) charges for business and legal entity alignment of $101 million and (iii) other charges of $23 million . For additional information, see Note 3 and Note 4. Equity in the net income of investees accounted for by the equity method is not significant for any of our operating segments. The operating segment information does not purport to represent the revenues, costs and income from continuing operations before provision for taxes on income that each of our operating segments would have recorded had each segment operated as a standalone company during the periods presented. B. Geographic Information The following table provides revenues by geographic area (a) : Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, United States $ 6,625 $ 4,433 Developed Europe (b) 2,370 2,312 Developed Rest of World (c) 1,520 1,493 Emerging Markets (d) 2,489 2,626 Revenues $ 13,005 $ 10,864 (a) On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. (b) Developed Europe region includes the following markets: Western Europe, Finland and the Scandinavian countries. Revenues denominated in euros were $1.8 billion in the first quarter of 2016 and $1.8 billion in the first quarter of 2015. (c) Developed Rest of World region includes the following markets: Australia, Canada, Japan, New Zealand and South Korea. (d) Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Africa, Eastern Europe, Central Europe, the Middle East and Turkey. C. Other Revenue Information Significant Product Revenues The following table provides detailed revenue information: Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, INNOVATIVE PRODUCTS BUSINESS (a) $ 7,033 $ 5,738 GIP (a) $ 3,640 $ 3,075 Lyrica GIP (b) 1,011 846 Enbrel (Outside the U.S. and Canada) 733 759 Viagra GIP (c) 300 288 Chantix/Champix 220 158 Xeljanz 197 96 BeneFIX 185 173 Refacto AF/Xyntha 129 120 Genotropin 125 138 Toviaz 64 63 Somavert 55 49 BMP2 51 38 Rapamune 45 53 Alliance revenues GIP (d), (l) 354 200 All other GIP 171 92 VOC (a) $ 3,394 $ 2,664 Prevnar/Prevenar 13 1,509 1,306 Ibrance 429 38 Sutent 278 242 Xalkori 139 111 Inlyta 101 95 All other V/O 117 63 Consumer Healthcare 822 808 ESTABLISHED PRODUCTS BUSINESS (e) $ 5,972 $ 5,125 Legacy Established Products (f) $ 2,800 $ 2,848 Lipitor 411 441 Premarin family 256 232 Norvasc 236 252 EpiPen 97 76 Xalatan/Xalacom 89 102 Zithromax/Zmax 80 79 Zoloft 79 86 Relpax 78 80 Effexor 70 73 Tikosyn 61 37 Xanax/Xanax XR 52 54 Cardura 45 52 Neurontin 44 55 All other Legacy Established Products (f), (l) 1,201 1,229 Peri-LOE Products (g) $ 1,090 $ 1,437 Lyrica GEP (b) 218 341 Pristiq 178 161 Celebrex 172 205 Vfend 156 182 Zyvox 127 271 Viagra GEP (c) 96 108 Revatio 66 63 All other Peri-LOE Products 76 107 Sterile Injectable Pharmaceuticals (h) $ 1,524 $ 729 Medrol 113 87 Sulperazon 96 98 Fragmin 78 74 Tygacil 76 74 All other Sterile Injectable Pharmaceuticals 1,161 396 Infusion Systems (i) $ 304 $ — Biosimilars (j) $ 66 $ — Pfizer CentreOne (k) $ 188 $ 111 Revenues $ 13,005 $ 10,864 Total Lyrica (b) $ 1,229 $ 1,187 Total Viagra (c) $ 396 $ 396 Total Alliance revenues (l) $ 360 $ 222 (a) The Innovative Products business is composed of two operating segments: GIP and VOC. (b) Lyrica revenues from all of Europe, Russia, Turkey, Israel and Central Asia countries are included in Lyrica-GEP. All other Lyrica revenues are included in Lyrica-GIP. Total Lyrica revenues represent the aggregate of worldwide revenues from Lyrica-GIP and Lyrica-GEP. (c) Viagra revenues from the U.S. and Canada are included in Viagra-GIP. All other Viagra revenues are included in Viagra-GEP. Total Viagra revenues represent the aggregate of worldwide revenues from Viagra-GIP and Viagra-GEP. (d) Includes Eliquis and Rebif. (e) The Established Products business consists of GEP, which includes all legacy Hospira commercial operations. Hospira's commercial operations, including the legacy Hospira One-2-One sterile injectables contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statement of income commencing from the acquisition date of September 3, 2015. As a result, revenues for the first quarter of 2015 and GEP's revenues for the first quarter of 2015 do not include Hospira's revenues. Also, effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) legacy Hospira's One-2-One sterile injectables contract manufacturing operation. Prior to 2016, PCS was managed outside our operating segments and its revenues were reported as other business activities. We have reclassified prior period PCS revenues ( $111 million in the first quarter of 2015) to conform to the current period presentation as part of GEP. (f) Legacy Established Products include products that have lost patent protection (excluding Sterile Injectable Pharmaceuticals and Peri-LOE Products). (g) Peri-LOE Products include products that have recently lost or are anticipated to soon lose patent protection. These products primarily include Celebrex and Zyvox in most developed markets, Lyrica in certain developed Europe markets, Pristiq globally and Inspra in the EU. (h) Sterile Injectable Pharmaceuticals include generic injectables and proprietary specialty injectables (excluding Peri-LOE Products). (i) Infusion Systems include Medication Management Systems products composed of infusion pumps and related software and services, as well as I.V. Infusion Products, including large volume I.V. solutions and their associated administration sets. (j) Biosimilars include Inflectra (biosimilar infliximab) in certain European markets, Nivestim (biosimilar filgrastim) in certain Asian markets and Retacrit (biosimilar epoetin zeta) in certain international markets. (k) Pfizer CentreOne includes (i) revenues from legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including revenues related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) revenues from legacy Hospira’s One-2-One sterile injectables contract manufacturing operation. For additional information, see (e) above. (l) Total Alliance revenues represent the aggregate of worldwide revenues from Alliance revenues GIP and Alliance revenues GEP, which is included in All other Legacy Established Products. |
Basis of Presentation and Sig20
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Apr. 03, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation We prepared the condensed consolidated financial statements following the requirements of the United States (U.S.) Securities and Exchange Commission (SEC) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by accounting principles generally accepted in the United States of America (U.S. GAAP) can be condensed or omitted. The financial information included in our condensed consolidated financial statements for subsidiaries operating outside the U.S. is as of and for the three months ended February 28, 2016 and February 22, 2015 . The financial information included in our condensed consolidated financial statements for U.S. subsidiaries is as of and for the three months ended April 3, 2016 and March 29, 2015 . Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be representative of those for the full year. We are responsible for the unaudited financial statements included in this Quarterly Report on Form 10-Q. The financial statements include all normal and recurring adjustments that are considered necessary for the fair presentation of our condensed consolidated balance sheets and condensed consolidated statements of income. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in our 2015 Annual Report on Form 10-K. Unless the context requires otherwise, references to “Pfizer,” “the Company,” “we,” “us” or “our” in this Quarterly Report on Form 10-Q refer to Pfizer Inc. and its subsidiaries. Certain amounts in the condensed consolidated financial statements and associated notes may not add due to rounding. All percentages have been calculated using unrounded amounts. In the condensed consolidated balance sheet as of December 31, 2015, we performed certain reclassifications to conform to the current period presentation of Other current assets , Other noncurrent assets , Short-term borrowings, including current portion of long-term debt and Long-term debt , and in the condensed consolidated statement of cash flows for the three months ended March 29, 2015, we performed certain reclassifications to conform to the current presentation of Proceeds from short-term borrowings for debt issuance costs in accordance with the adoption of a new accounting standard (for additional information, see Note 1B ). Certain prior period reclassifications were made to the Global Established Pharmaceutical (GEP) segment operating results to conform to the current period presentation for certain organizational changes impacting GEP in 2016. For additional information, see Note 13 . On April 6, 2016, we announced that the merger agreement between Pfizer and Allergan plc (Allergan) entered into on November 22, 2015 was terminated by mutual agreement of the companies. The decision was driven by the actions announced by the U.S. Department of Treasury on April 4, 2016, which the companies concluded qualified as an “Adverse Tax Law Change” under the merger agreement. In connection with the termination of the merger agreement, on April 8, 2016 (which falls into Pfizer’s second fiscal quarter), Pfizer paid Allergan $150 million (pre-tax) for reimbursement of Allergan’s expenses associated with the terminated transaction. Pfizer and Allergan also released each other from any and all claims in connection with the merger agreement or the transactions contemplated thereby. On September 3, 2015, we completed our acquisition of Hospira, Inc. (Hospira) and, commencing from the acquisition date, our financial statements reflect the assets, liabilities. operating results and cash flows of Hospira. As a result, legacy Hospira operations are reflected in our results of operations, GEP’s operating results, and cash flows for the first quarter of 2016, but not for the first quarter of 2015. Legacy Hospira assets and liabilities are reflected in our balance sheets as of April 3, 2016 and December 31, 2015. |
Adoption of New Accounting Standards | Adoption of New Accounting Standards We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016, debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $75 million ). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ( $1 million from Other current assets and $79 million from Other noncurrent assets ) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $79 million ) to conform to the current period presentation. For additional information, see Note 7A. We adopted a new standard as of January 1, 2016 that requires an acquirer to recognize adjustments made in the measurement period to provisional amounts of assets acquired and liabilities assumed in a business combination in the reporting period in which the adjustment amounts are determined. There was no material impact to our condensed consolidated financial statements in the first quarter of 2016 from adopting this standard. For additional information, see Note 2A. We adopted a new standard as of January 1, 2016 related to the accounting for hybrid financial instruments issued or held as investments and there was no material impact to our condensed consolidated financial statements from adopting this standard. |
Fair Value | Fair Value Our fair value methodologies depend on the following types of inputs: • Quoted prices for identical assets or liabilities in active markets (Level 1 inputs). • Quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are directly or indirectly observable, or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means (Level 2 inputs). • Unobservable inputs that reflect estimates and assumptions (Level 3 inputs). A single estimate of fair value can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. |
Acquisitions, Research and De21
Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Business Combinations, Discontinued Operations And Disposal Groups, Collaborative Arrangements And Equity Method Investments [Abstract] | |
Schedule of Amounts Recognized for Assets Acquired and Liabilities Assumed | The following table summarizes the provisional amounts recognized for assets acquired and liabilities assumed as of the acquisition date, as well as adjustments made in the first quarter of 2016 to the provisional amounts initially recorded in 2015 (measurement period adjustments) with a corresponding change to goodwill. Certain estimated values are not yet finalized (see below) and are subject to change, which could be significant. We will finalize the amounts recognized as we obtain the information necessary to complete the analyses, but no later than one year from the acquisition date. (MILLIONS OF DOLLARS) Amounts Recognized as of Acquisition Date (as previously reported as of December 31, 2015) Measurement Period Adjustments Amounts Recognized as of Acquisition Date (as adjusted) Working capital, excluding inventories $ 274 $ (6 ) $ 268 Inventories 1,924 (16 ) 1,908 Property, plant and equipment (a) 2,410 (53 ) 2,357 Identifiable intangible assets, excluding in-process research and development (a) 8,270 65 8,335 In-process research and development 995 5 1,000 Other noncurrent assets 408 (46 ) 362 Long-term debt (1,928 ) — (1,928 ) Benefit obligations (117 ) — (117 ) Net income tax accounts (3,394 ) 25 (3,369 ) Other noncurrent liabilities (39 ) — (39 ) Total identifiable net assets 8,803 (25 ) 8,778 Goodwill 7,284 25 7,309 Net assets acquired/total consideration transferred $ 16,087 $ — $ 16,087 (a) The measurement period adjustments for Identifiable intangible assets reflect changes in the estimated fair value of acquired finite-lived developed technology rights. The measurement period adjustments for Property, plant and equipment primarily reflect changes in the estimated fair value of acquired buildings and machinery and equipment. The changes in the estimated fair values for identifiable intangible assets and property, plant and equipment are primarily to better reflect market participant assumptions about facts and circumstances existing as of the acquisition date. The measurement period adjustments did not result from intervening events subsequent to the acquisition date. |
Summary of Pro Forma Information | The following table provides supplemental pro forma information as if the acquisition of Hospira had occurred on January 1, 2014: Unaudited Supplemental Pro Forma Consolidated Results Three Months Ended (MILLIONS OF DOLLARS, EXCEPT PER SHARE DATA) March 29, Revenues $ 12,039 Net income attributable to Pfizer Inc. common shareholders 2,375 Diluted earnings per share attributable to Pfizer Inc. common shareholders 0.38 |
Restructuring Charges and Oth22
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring and Related Costs | The following table provides the components of costs associated with acquisitions and cost-reduction/productivity initiatives: Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, Restructuring charges (a) : Employee terminations $ 24 $ 31 Asset impairments 1 6 Exit costs 4 6 Total restructuring charges 30 42 Transaction costs (b) 24 5 Integration costs (c) 87 13 Restructuring charges and certain acquisition-related costs 141 60 Additional depreciation––asset restructuring recorded in our condensed consolidated statements of income as follows (d) : Cost of sales 45 17 Research and development expenses 4 1 Total additional depreciation––asset restructuring 49 18 Implementation costs recorded in our condensed consolidated statements of income as follows (e) : Cost of sales 43 13 Selling, informational and administrative expenses 12 26 Research and development expenses 6 8 Total implementation costs 62 48 Total costs associated with acquisitions and cost-reduction/productivity initiatives $ 252 $ 127 (a) In the three months ended April 3, 2016 , Employee terminations represent the expected reduction of the workforce by approximately 100 employees, mainly in manufacturing. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination. The restructuring charges for the three months ended April 3, 2016 are associated with the following: • the Global Innovative Pharmaceutical segment (GIP) ( $8 million ); the Global Vaccines, Oncology and Consumer Healthcare segment (VOC) ( $1 million ); the Global Established Pharmaceutical segment (GEP) ( $3 million ); Worldwide Research and Development and Medical (WRD/M) ( $3 million ); manufacturing operations ( $14 million ); and Corporate ( $1 million ). The restructuring charges for the three months ended March 29, 2015 are associated with the following: • GIP ( $12 million ); VOC ( $13 million ); GEP ( $10 million ); WRD/M ( $12 million ); manufacturing operations ( $22 million income); and Corporate ( $18 million ). (b) Transaction costs represent external costs for banking, legal, accounting and other similar services, most of which are directly related to the terminated transaction with Allergan. (c) Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes, primarily related to the acquisition of Hospira. (d) Additional depreciation––asset restructuring represents the impact of changes in the estimated useful lives of assets involved in restructuring actions. (e) Implementation costs represent external, incremental costs directly related to implementing our non-acquisition-related cost-reduction/productivity initiatives. |
Schedule of Restructuring Reserve by Type of Cost | The following table provides the components of and changes in our restructuring accruals: (MILLIONS OF DOLLARS) Employee Termination Costs Asset Impairment Charges Exit Costs Accrual Balance, December 31, 2015 (a) $ 1,109 $ — $ 48 $ 1,157 Provision 24 1 4 30 Utilization and other (b) (165 ) (1 ) (9 ) (175 ) Balance, April 3, 2016 (c) $ 968 $ — $ 43 $ 1,011 (a) Included in Other current liabilities ( $776 million ) and Other noncurrent liabilities ( $381 million ). (b) Includes adjustments for foreign currency translation. (c) Included in Other current liabilities ( $638 million ) and Other noncurrent liabilities ( $373 million ). |
Other (Income)_Deductions - N23
Other (Income)/Deductions - Net (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Other Income and Expenses [Abstract] | |
Schedule of Other (Income)/Deductions - Net | The following table provides components of Other (income)/deductions––net : Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, Interest income (a) $ (113 ) $ (93 ) Interest expense 306 309 Net interest expense 193 216 Royalty-related income (187 ) (222 ) Certain legal matters, net (b) 274 — Net gains on asset disposals (c) (9 ) (175 ) Certain asset impairments (d) 131 — Business and legal entity alignment costs (e) 51 101 Other, net (f) (122 ) 34 Other (income)/deductions––net $ 330 $ (46 ) (a) Interest income increased in the first quarter of 2016 , primarily due to higher investment returns. (b) In the first quarter of 2016 , primarily includes an accrual for an unresolved legal matter and a settlement related to a patent matter. (c) In the first quarter of 2016 , primarily includes gains on sales/out-licensing of product and compound rights (approximately $16 million ). In the first quarter of 2015 , primarily includes gains on sales/out-licensing of product and compound rights (approximately $45 million ) and gains on sales of investments in equity securities (approximately $120 million ). (d) In the first quarter of 2016 , represents an impairment loss of $81 million related to Pfizer’s 49% -owned equity-method investment with Zhejiang Hisun Pharmaceuticals Co., Ltd. (Hisun) in China, Hisun Pfizer, and an impairment loss of $50 million related to Pfizer's 40% -owned equity-method investment in Teuto. For additional information concerning Hisun Pfizer and Teuto, see Note 2C. (e) In the first quarter of 2016 and 2015 , represents expenses for changes to our infrastructure to align our commercial operations, including costs to internally separate our businesses into distinct legal entities, as well as to streamline our intercompany supply operations to better support each business. (f) In the first quarter of 2016 , primarily includes, among other things, income of $116 million from resolution of a contract disagreement. |
Tax Matters (Tables)
Tax Matters (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Tax Provision (Benefit) on Other Comprehensive Income/(Loss) | The following table provides the components of Tax provision/(benefit) on other comprehensive loss: Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, Foreign currency translation adjustments, net (a) $ (14 ) $ 85 Unrealized holding losses on derivative financial instruments, net (36 ) (224 ) Reclassification adjustments for realized (gains)/losses (72 ) 183 (108 ) (41 ) Unrealized holding gains/(losses) on available-for-sale securities, net 17 (31 ) Reclassification adjustments for realized losses 26 (1 ) 43 (32 ) Benefit plans: actuarial gains, net — 12 Reclassification adjustments related to amortization 47 46 Reclassification adjustments related to settlements, net 9 15 Other (1 ) 37 55 109 Benefit plans: prior service costs and other, net — — Reclassification adjustments related to amortization (15 ) (13 ) Reclassification adjustments related to curtailments, net (2 ) (4 ) Other 1 — (16 ) (17 ) Tax provision/(benefit) on other comprehensive loss $ (41 ) $ 105 (a) Taxes are not provided for foreign currency translation adjustments relating to investments in international subsidiaries that will be held indefinitely. |
Accumulated Other Comprehensi25
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Equity [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Loss, Net of Tax | The following table provides the changes, net of tax, in Accumulated other comprehensive loss : Net Unrealized Gains/(Losses) Benefit Plans (MILLIONS OF DOLLARS) Foreign Currency Translation Adjustments Derivative Financial Instruments Available-For-Sale Securities Actuarial Gains/(Losses) Prior Service (Costs)/Credits and Other Accumulated Other Comprehensive Loss Balance, December 31, 2015 $ (5,863 ) $ 421 $ (227 ) $ (4,733 ) $ 880 $ (9,522 ) Other comprehensive income/(loss) (a) 87 (504 ) 296 148 (25 ) 2 Balance, April 3, 2016 $ (5,776 ) $ (83 ) $ 69 $ (4,585 ) $ 855 $ (9,520 ) (a) Amounts do not include foreign currency translation adjustments attributable to noncontrolling interests of $6 million loss for the first three months of 2016 . |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Financial Instruments [Abstract] | |
Information about Certain Financial Assets and Liabilities | The following table provides additional information about certain of our financial assets and liabilities: (MILLIONS OF DOLLARS) April 3, December 31, Selected financial assets measured at fair value on a recurring basis (a) Trading funds (b) $ 260 $ 287 Available-for-sale debt securities (c) 27,819 32,078 Money market funds 947 934 Available-for-sale equity securities (c) 497 603 Derivative financial instruments in a receivable position (d) : Interest rate swaps 1,433 837 Foreign currency swaps 103 135 Foreign currency forward-exchange contracts 333 559 31,391 35,433 Other selected financial assets Held-to-maturity debt securities, carried at amortized cost (c), (e) 1,065 1,388 Private equity securities, carried at equity-method or at cost (e), (f) 1,250 1,336 2,315 2,724 Total selected financial assets $ 33,705 $ 38,157 Selected financial liabilities measured at fair value on a recurring basis (a) Derivative financial instruments in a liability position (g) : Interest rate swaps $ 9 $ 139 Foreign currency swaps 1,311 1,489 Foreign currency forward-exchange contracts 432 81 1,752 1,709 Other selected financial liabilities (h) Short-term borrowings, carried at historical proceeds, as adjusted (e), (i) 11,546 10,159 Long-term debt, carried at historical proceeds, as adjusted (i), (j) 27,824 28,740 39,370 38,899 Total selected financial liabilities $ 41,122 $ 40,608 (a) We use a market approach in valuing financial instruments on a recurring basis. For additional information, see Note 1C. All of our financial assets and liabilities measured at fair value on a recurring basis use Level 2 inputs in the calculation of fair value, except less than 1% that use Level 1 inputs and money market funds measured at net asset value. (b) As of April 3, 2016 , trading funds are composed of $204 million of trading equity funds and $56 million of trading debt funds. As of December 31, 2015 , trading funds are composed of $185 million of trading equity funds and $102 million of trading debt funds. As of April 3, 2016 and December 31, 2015 , trading equity funds of $65 million and $85 million , respectively, are held in trust for benefits attributable to the former Pharmacia Savings Plus Plan. (c) Gross unrealized gains and losses are not significant. (d) Designated as hedging instruments, except for certain contracts used as offsets; namely, foreign currency forward-exchange contracts with fair values of $144 million as of April 3, 2016 ; and foreign currency forward-exchange contracts with fair values of $136 million as of December 31, 2015 . (e) Short-term borrowings include foreign currency short-term borrowings with fair values of $547 million as of December 31, 2015 , which are used as hedging instruments. The differences between the estimated fair values and carrying values of held-to-maturity debt securities, private equity securities at cost and short-term borrowings not measured at fair value on a recurring basis were not significant as of April 3, 2016 or December 31, 2015 . The fair value measurements of our held-to-maturity debt securities and our short-term borrowings are based on Level 2 inputs, using a market approach. The fair value measurements of our priv ate equity securities carried at cost are based on Level 3 inputs. (f) Our private equity securities represent investments in the life sciences sector. (g) Designated as hedging instruments, except for certain contracts used as offsets; namely, foreign currency swaps with fair values of $188 million and foreign currency forward-exchange contracts with fair values of $117 million as of April 3, 2016 ; and foreign currency swaps with fair values of $234 million and foreign currency forward-exchange contracts with fair values of $59 million as of December 31, 2015 . (h) Some carrying amounts may include adjustments for discount or premium amortization or for the effect of hedging the interest rate fair value risk associated with certain financial liabilities by interest rate swaps. (i) We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016 , debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $75 million ). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ( $1 million from Other current assets and $79 million from Other noncurrent assets ) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $79 million ) to conform to the current period presentation. (j) The fair value of our long-term debt (not including the current portion of long-term debt) was $31.8 billion as of April 3, 2016 and $32.7 billion as of December 31, 2015 . The fair value measurements for our long-term debt are based on Level 2 inputs, using a market approach. Generally, the difference between the fair value of our long-term debt and the amount reported on the condensed consolidated balance sheet is due to a decline in relative market interest rates since the debt issuance. |
Selected Financial Assets and Liabilities Presented in the Condensed Consolidated Balance Sheets | The following table provides the classification of these selected financial assets and liabilities in our condensed consolidated balance sheets: (MILLIONS OF DOLLARS) April 3, December 31, Assets Cash and cash equivalents $ 809 $ 978 Short-term investments 16,882 19,649 Long-term investments 14,146 15,999 Other current assets (a) 390 587 Other noncurrent assets (b) 1,478 944 $ 33,705 $ 38,157 Liabilities Short-term borrowings, including current portion of long-term debt (c) $ 11,546 $ 10,159 Other current liabilities (d) 862 645 Long-term debt (c) 27,824 28,740 Other noncurrent liabilities (e) 890 1,064 $ 41,122 $ 40,608 (a) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $5 million ), foreign currency swaps ( $62 million ) and foreign currency forward-exchange contracts ( $323 million ) and, as of December 31, 2015 , include interest rate swaps ( $2 million ), foreign currency swaps ( $46 million ) and foreign currency forward-exchange contracts ( $538 million ). (b) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $1,428 million ), foreign currency swaps ( $41 million ) and foreign currency forward-exchange contracts ( $9 million ) and, as of December 31, 2015 , include interest rate swaps ( $835 million ), foreign currency swaps ( $89 million ) and foreign currency forward-exchange contracts ( $20 million ). (c) We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016 , debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $75 million ). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ( $1 million from Other current assets and $79 million from Other noncurrent assets ) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ( $1 million ) and Long-term debt ( $79 million ) to conform to the current period presentation. (d) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $5 million ), foreign currency swaps ( $454 million ) and foreign currency forward-exchange contracts ( $403 million ) and, as of December 31, 2015 , include interest rate swaps ( $5 million ), foreign currency swaps ( $560 million ) and foreign currency forward-exchange contracts ( $80 million ). (e) As of April 3, 2016 , derivative instruments at fair value include interest rate swaps ( $4 million ), foreign currency swaps ( $857 million ) and foreign currency forward-exchange contracts ( $29 million ) and, as of December 31, 2015 , include interest rate swaps ( $134 million ), foreign currency swaps ( $928 million ) and foreign currency forward-exchange contracts ( $1 million ). |
Contractual Maturities of Available-for-sale and Held-to-maturity Debt Securities | The following table provides the contractual maturities, or as necessary, the estimated maturities, of the available-for-sale and held-to-maturity debt securities: Years April 3, (MILLIONS OF DOLLARS) Within 1 Over 1 to 5 Over 5 to 10 Over 10 Total Available-for-sale debt securities Western European, Asian, Scandinavian and other government debt (a) $ 7,056 $ 1,033 $ 8 $ — $ 8,097 Corporate debt (b) 3,223 4,786 1,656 15 9,680 U.S. government debt 1,812 848 207 — 2,867 Federal Home Loan Mortgage Corporation and Federal National Mortgage Association asset-backed securities 34 2,110 71 11 2,227 Western European, Scandinavian and other government agency debt (a) 1,587 210 — — 1,797 Supranational debt (a) 911 323 — — 1,234 Government National Mortgage Association and other U.S. government guaranteed asset-backed securities 599 112 18 — 729 Other asset-backed debt (c) 461 682 40 4 1,188 Held-to-maturity debt securities Time deposits and other 1,024 5 — — 1,029 Western European government debt (a) 36 — — — 36 Total debt securities $ 16,744 $ 10,109 $ 2,001 $ 31 $ 28,884 (a) Issued by governments, government agencies or supranational entities, as applicable, all of which are investment-grade. (b) Issued by a diverse group of corporations, largely consisting of financial institutions, virtually all of which are investment-grade. (c) Includes loan-backed, receivable-backed, and mortgage-backed securities, all of which are investment-grade and in senior positions in the capital structure of the security. Loan-backed securities are collateralized by senior secured obligations of a diverse pool of companies or student loans, and receivable-backed securities are collateralized by credit cards receivables. Mortgage-backed securities are collateralized by diversified pools of residential and commercial mortgages. These securities are valued by third party models that use significant inputs derived from observable market data like prepayment rates, default rates, and recovery rates. |
Derivative Instruments, Gain (Loss) | The following table provides information about the gains/(losses) incurred to hedge or offset operational foreign exchange or interest rate risk: Three Months Ended Amount of Gains/(Losses) Recognized in OID (a), (b), (c) Amount of Gains/(Losses) Recognized in OCI (Effective Portion) (a), (d) Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) (a), (d) (MILLIONS OF DOLLARS) April 3, March 29, April 3, March 29, April 3, March 29, Derivative Financial Instruments in Cash Flow Hedge Relationships: Foreign currency swaps $ — $ — $ 55 $ (732 ) $ 118 $ (607 ) Foreign currency forward-exchange contracts 1 — (328 ) 417 221 373 Derivative Financial Instruments in Net Investment Hedge Relationships: Foreign currency forward-exchange contracts (2 ) 2 (12 ) 249 — — Derivative Financial Instruments Not Designated as Hedges: Foreign currency forward-exchange contracts (1 ) (41 ) — — — — Foreign currency swaps (23 ) 1 — — — — Non-Derivative Financial Instruments in Net Investment Hedge Relationships: Foreign currency short-term borrowings — — (26 ) — — — Foreign currency long-term debt — — — (3 ) — — $ (25 ) $ (38 ) $ (311 ) $ (68 ) $ 339 $ (234 ) (a) OID = Other (income)/deductions—net, included in Other (income)/deductions—net in the condensed consolidated statements of income . OCI = Other comprehensive income/(loss), included in the condensed consolidated statements of comprehensive income . (b) Also, includes gains and losses attributable to derivative instruments designated and qualifying as fair value hedges, as well as the offsetting gains and losses attributable to the hedged items in such hedging relationships. (c) There was no significant ineffectiveness for any period presented. (d) For derivative financial instruments in cash flow hedge relationships, the effective portion is included in Other comprehensive loss––Unrealized holding losses on derivative financial instruments, net . For derivative financial instruments in net investment hedge relationships and for foreign currency debt designated as hedging instruments, the effective portion is included in Other comprehensive loss––Foreign currency translation adjustments, net. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Components of Inventories, Current | The following table provides the components of Inventories : (MILLIONS OF DOLLARS) April 3, December 31, Finished goods $ 2,782 $ 2,714 Work-in-process 3,957 3,932 Raw materials and supplies 840 867 Inventories $ 7,578 $ 7,513 Noncurrent inventories not included above (a) $ 644 $ 594 (a) Included in Other noncurrent assets . There are no recoverability issues associated with these amounts. |
Schedule of Components of Inventories, Noncurrent | The following table provides the components of Inventories : (MILLIONS OF DOLLARS) April 3, December 31, Finished goods $ 2,782 $ 2,714 Work-in-process 3,957 3,932 Raw materials and supplies 840 867 Inventories $ 7,578 $ 7,513 Noncurrent inventories not included above (a) $ 644 $ 594 (a) Included in Other noncurrent assets . There are no recoverability issues associated with these amounts. |
Identifiable Intangible Asset28
Identifiable Intangible Assets and Goodwill (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | The following table provides the components of Identifiable intangible assets : April 3, 2016 December 31, 2015 (MILLIONS OF DOLLARS) Gross Carrying Amount Accumulated Amortization Identifiable Intangible Assets, less Accumulated Amortization Gross Carrying Amount Accumulated Amortization Identifiable Intangible Assets, less Accumulated Amortization Finite-lived intangible assets Developed technology rights $ 77,630 $ (48,088 ) $ 29,543 $ 77,613 $ (47,193 ) $ 30,419 Brands 2,103 (956 ) 1,147 1,973 (928 ) 1,044 Licensing agreements and other 1,772 (931 ) 841 1,619 (918 ) 701 81,505 (49,975 ) 31,530 81,205 (49,040 ) 32,165 Indefinite-lived intangible assets Brands and other 6,893 6,893 7,021 7,021 In-process research and development 1,179 1,179 1,171 1,171 8,072 8,072 8,192 8,192 Identifiable intangible assets (a) $ 89,577 $ (49,975 ) $ 39,602 $ 89,396 $ (49,040 ) $ 40,356 (a) The decrease in I dentifiable intangible assets, less accumulated amortization , is primarily related to amortization, partially offset by assets acquired, the impact of measurement period adjustments related to our acquisition of Hospira (see Note 2A ) and the impact of foreign exchange. |
Schedule of Indefinite Lived Intangible Assets | The following table provides the components of Identifiable intangible assets : April 3, 2016 December 31, 2015 (MILLIONS OF DOLLARS) Gross Carrying Amount Accumulated Amortization Identifiable Intangible Assets, less Accumulated Amortization Gross Carrying Amount Accumulated Amortization Identifiable Intangible Assets, less Accumulated Amortization Finite-lived intangible assets Developed technology rights $ 77,630 $ (48,088 ) $ 29,543 $ 77,613 $ (47,193 ) $ 30,419 Brands 2,103 (956 ) 1,147 1,973 (928 ) 1,044 Licensing agreements and other 1,772 (931 ) 841 1,619 (918 ) 701 81,505 (49,975 ) 31,530 81,205 (49,040 ) 32,165 Indefinite-lived intangible assets Brands and other 6,893 6,893 7,021 7,021 In-process research and development 1,179 1,179 1,171 1,171 8,072 8,072 8,192 8,192 Identifiable intangible assets (a) $ 89,577 $ (49,975 ) $ 39,602 $ 89,396 $ (49,040 ) $ 40,356 (a) The decrease in I dentifiable intangible assets, less accumulated amortization , is primarily related to amortization, partially offset by assets acquired, the impact of measurement period adjustments related to our acquisition of Hospira (see Note 2A ) and the impact of foreign exchange. |
Identifiable intangible assets as a percentage of total identifiable intangible assets less accumulated amortization, by segment | Our identifiable intangible assets are associated with the following, as a percentage of total identifiable intangible assets, less accumulated amortization: April 3, 2016 GIP VOC GEP WRD Developed technology rights 21 % 29 % 50 % — % Brands, finite-lived — % 73 % 27 % — % Brands, indefinite-lived — % 71 % 29 % — % In-process research and development 2 % 10 % 85 % 3 % |
Schedule of Goodwill | The following table provides the components of and changes in the carrying amount of Goodwill : (MILLIONS OF DOLLARS) GIP VOC GEP Total Balance, December 31, 2015 $ 12,689 $ 11,120 $ 24,433 $ 48,242 Additions — 51 26 78 Other (a) 76 60 102 238 Balance, April 3, 2016 $ 12,765 $ 11,231 $ 24,562 $ 48,558 (a) Primarily reflects the impact of foreign exchange. |
Pension and Postretirement Be29
Pension and Postretirement Benefit Plans (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Schedule of Net Periodic Benefit Costs | The following table provides the components of net periodic benefit cost: Three Months Ended Pension Plans U.S. Qualified (a) U.S. Supplemental (Non-Qualified) (b) International (c) Postretirement Plans (d) (MILLIONS OF DOLLARS) Apr 3, Mar 29, Apr 3, Mar 29, Apr 3, Mar 29, Apr 3, Mar 29, Net periodic benefit cost/(credit): Service cost (e) $ 63 $ 72 $ 5 $ 6 $ 42 $ 48 $ 10 $ 14 Interest cost (e) 134 169 12 14 60 79 22 32 Expected return on plan assets (241 ) (272 ) — — (98 ) (106 ) (8 ) (13 ) Amortization of: Actuarial losses 99 83 9 12 23 32 7 9 Prior service credits 1 (2 ) — — — (2 ) (41 ) (31 ) Curtailments 2 2 — — — — (6 ) (10 ) Settlements 15 26 10 15 1 — — — $ 73 $ 78 $ 35 $ 45 $ 27 $ 51 $ (16 ) $ 1 (a) The decrease in net periodic benefit costs for the three months ended April 3, 2016 , compared to the three months ended March 29, 2015 , for our U.S. qualified pension plans was primarily driven by (i) lower service and interest costs, resulting from a change in methodology for measuring service and interest costs (see (e) below) and (ii) lower settlement activity. The aforementioned decreases were partially offset by (i) a lower expected return on plan assets resulting from a net decrease of approximately $1.1 billion in the asset base due in part to lump-sum payments made in 2015 to certain terminated colleagues to settle Pfizer’s pension obligation, partially offset by a voluntary contribution of $1.0 billion made at the beginning of January 2016 and (ii) an increase in the amounts amortized for actuarial losses. (b) The decrease in net periodic benefit costs for the three months ended April 3, 2016, compared to the three months ended March 29, 2015, for our U.S. non-qualified pension plans was primarily driven by (i) lower settlement activity and (ii) a decrease in the amounts amortized for actuarial losses resulting from the increase, in 2015, in the discount rate used to determine the benefit obligation. (c) The decrease in net periodic benefit costs for the three months ended April 3, 2016 , compared to the three months ended March 29, 2015 , for our international pension plans was primarily driven by (i) lower service and interest costs, resulting from foreign exchange rate changes and a change in methodology for measuring service and interest costs (see (e) below), and (ii) a decrease in the amounts amortized for actuarial losses resulting from large gains in 2015, which decreased the plan net loss position, partially offset by (i) a decrease in the expected return on plan assets due to a lower expected rate of return on plan assets, and foreign exchange rates changes. (d) The decrease in net periodic benefit costs for the three months ended April 3, 2016 , compared to the three months ended March 29, 2015 , for our postretirement plans was primarily driven by (i) lower service and interest costs, resulting from a change in methodology for measuring service and interest costs (see (e) below) and (ii) an increase in prior service credits due to the postretirement medical plan cap changes during 2015. The aforementioned changes were partially offset by (i) a decrease in expected return on plan assets, primarily resulting from a decrease in plan assets reflecting Internal Revenue Code 401(h) reimbursements to Pfizer for eligible 2014 and 2015 prescription drug expenses for certain retirees, and (ii) lower curtailment gains. (e) Effective January 1, 2016, the Company changed the approach used to measure service and interest costs for U.S. and certain international pension and other postretirement benefits. For fiscal 2015, the Company measured service and interest costs utilizing a single weighted-average discount rate derived from the bond model or yield curve used to measure the respective plan obligations. For fiscal 2016, we elected to measure service and interest costs by applying the spot rates along the yield curve, or a yield curve implied from the bond model, to the plans' liability cash flows. The Company believes the new approach provides a more precise measurement of service and interest costs by aligning the timing of the plans’ liability cash flows to the corresponding spot rates on the yield curve. This change does not affect the measurement of our plan obligations. We have accounted for this change as a change in accounting estimate and, accordingly, have accounted for it on a prospective basis. The expected reduction in expense for 2016 associated with this change in estimate is $191 million , which is expected to be recognized evenly over each quarter of the year. |
Schedule of Employer Contributions to Pension and Postretirement Plans | As of and for the three months ended April 3, 2016 , we contributed and expect to contribute from our general assets as follows: Pension Plans (MILLIONS OF DOLLARS) U.S. Qualified U.S. Supplemental (Non-Qualified) International Postretirement Plans Contributions from/reimbursements of our general assets for the three months ended April 3, 2016 (a) $ 1,000 $ 70 $ 50 $ (148 ) Expected contributions from our general assets during 2016 (b) $ 1,000 $ 126 $ 174 $ (6 ) (a) Contributions to the postretirement plans reflect Internal Revenue Code 401(h) reimbursements totaling $198 million received for eligible 2014 and 2015 prescription drug expenses for certain retirees. (b) Contributions expected to be made for 2016 are inclusive of amounts contributed during the three months ended April 3, 2016 , including the $1.0 billion voluntary contribution that was made in January 2016 for the U.S. qualified plans, which was considered pre-funding for future anticipated mandatory contributions and is also expected to reduce Pension Benefit Guaranty Corporation variable rate premiums. The U.S. supplemental (non-qualified) pension plan, international pension plan and the postretirement plan contributions from our general assets include direct employer benefit payments. |
Earnings Per Common Share Att30
Earnings Per Common Share Attributable to Common Shareholders (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earning Per Share | The following table provides the detailed calculation of Earnings per common share (EPS) : Three Months Ended (IN MILLIONS) April 3, March 29, EPS Numerator––Basic Income from continuing operations $ 3,026 $ 2,376 Less: Net income attributable to noncontrolling interests 9 6 Income from continuing operations attributable to Pfizer Inc. 3,016 2,371 Less: Preferred stock dividends––net of tax — — Income from continuing operations attributable to Pfizer Inc. common shareholders 3,016 2,370 Discontinued operations––net of tax — 5 Less: Discontinued operations––net of tax, attributable to noncontrolling interests — — Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders — 5 Net income attributable to Pfizer Inc. common shareholders $ 3,016 $ 2,375 EPS Numerator––Diluted Income from continuing operations attributable to Pfizer Inc. common shareholders and assumed conversions $ 3,016 $ 2,371 Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders and assumed conversions — 5 Net income attributable to Pfizer Inc. common shareholders and assumed conversions $ 3,016 $ 2,376 EPS Denominator Weighted-average number of common shares outstanding––Basic 6,150 6,203 Common-share equivalents: stock options, stock issuable under employee compensation plans, convertible preferred stock and accelerated share repurchase agreements 64 90 Weighted-average number of common shares outstanding––Diluted 6,214 6,292 Stock options that had exercise prices greater than the average market price of our common stock issuable under employee compensation plans (a) 86 34 (a) These common stock equivalents were outstanding for the three months ended April 3, 2016 and March 29, 2015 , but were not included in the computation of diluted EPS for those periods because their inclusion would have had an anti-dilutive effect. |
Segment, Geographic and Other31
Segment, Geographic and Other Revenue Information (Tables) | 3 Months Ended |
Apr. 03, 2016 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated | The following table provides selected income statement information by reportable segment: Three Months Ended Revenues Earnings (a) (MILLIONS OF DOLLARS) April 3, March 29, April 3, March 29, Reportable Segments: GIP $ 3,640 $ 3,075 $ 2,192 $ 1,511 VOC 3,394 2,664 1,835 1,464 GEP (b) 5,972 5,125 3,657 3,215 Total reportable segments 13,005 10,864 7,684 6,190 Other business activities (c) — — (619 ) (624 ) Reconciling Items: Corporate (c) — — (1,363 ) (1,287 ) Purchase accounting adjustments (c) — — (1,153 ) (903 ) Acquisition-related costs (c) — — (116 ) (23 ) Certain significant items (d) — — (638 ) (228 ) Other unallocated — — (234 ) (45 ) $ 13,005 $ 10,864 $ 3,561 $ 3,082 (a) Income from continuing operations before provision for taxes on income. (b) On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira commercial operations, including the legacy Hospira One-2-One contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. Effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) the revenues and expenses of legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including the revenues and expenses related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) the revenues and expenses of legacy Hospira's One-2-One sterile injectables contract manufacturing operation, which has been included in GEP since we acquired Hospira on September 3, 2015. Prior to 2016, PCS was managed outside our operating segments as part of Pfizer Global Supply and reported as "Other Business Activities". We have reclassified prior period PCS operating results ( $111 million of PCS revenues and $21 million of PCS earnings in the first quarter of 2015) to conform to the current period presentation as part of GEP. As noted above, also effective as of the beginning of 2016, in connection with the formation of a new GEP R&D organization, certain functions transferred from WRD into the new GEP R&D organization. We have reclassified approximately $66 million of costs in the first quarter of 2015 from WRD to GEP to conform to the current period presentation as part of GEP. (c) For a description, see the “Other Costs and Business Activities” section above. (d) Certain significant items are substantive, unusual items that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis. For Earnings in the first quarter of 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $137 million , (ii) charges for certain legal matters of $286 million , (iii) certain asset impairment charges of $131 million , (iv) charges for business and legal entity alignment of $51 million and (v) other charges of $34 million . For additional information, see Note 3 and Note 4. For Earnings in the first quarter of 2015, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $104 million , (ii) charges for business and legal entity alignment of $101 million and (iii) other charges of $23 million . For additional information, see Note 3 and Note 4. |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following table provides selected income statement information by reportable segment: Three Months Ended Revenues Earnings (a) (MILLIONS OF DOLLARS) April 3, March 29, April 3, March 29, Reportable Segments: GIP $ 3,640 $ 3,075 $ 2,192 $ 1,511 VOC 3,394 2,664 1,835 1,464 GEP (b) 5,972 5,125 3,657 3,215 Total reportable segments 13,005 10,864 7,684 6,190 Other business activities (c) — — (619 ) (624 ) Reconciling Items: Corporate (c) — — (1,363 ) (1,287 ) Purchase accounting adjustments (c) — — (1,153 ) (903 ) Acquisition-related costs (c) — — (116 ) (23 ) Certain significant items (d) — — (638 ) (228 ) Other unallocated — — (234 ) (45 ) $ 13,005 $ 10,864 $ 3,561 $ 3,082 (a) Income from continuing operations before provision for taxes on income. (b) On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira commercial operations, including the legacy Hospira One-2-One contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. Effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) the revenues and expenses of legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including the revenues and expenses related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) the revenues and expenses of legacy Hospira's One-2-One sterile injectables contract manufacturing operation, which has been included in GEP since we acquired Hospira on September 3, 2015. Prior to 2016, PCS was managed outside our operating segments as part of Pfizer Global Supply and reported as "Other Business Activities". We have reclassified prior period PCS operating results ( $111 million of PCS revenues and $21 million of PCS earnings in the first quarter of 2015) to conform to the current period presentation as part of GEP. As noted above, also effective as of the beginning of 2016, in connection with the formation of a new GEP R&D organization, certain functions transferred from WRD into the new GEP R&D organization. We have reclassified approximately $66 million of costs in the first quarter of 2015 from WRD to GEP to conform to the current period presentation as part of GEP. (c) For a description, see the “Other Costs and Business Activities” section above. (d) Certain significant items are substantive, unusual items that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis. For Earnings in the first quarter of 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $137 million , (ii) charges for certain legal matters of $286 million , (iii) certain asset impairment charges of $131 million , (iv) charges for business and legal entity alignment of $51 million and (v) other charges of $34 million . For additional information, see Note 3 and Note 4. For Earnings in the first quarter of 2015, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $104 million , (ii) charges for business and legal entity alignment of $101 million and (iii) other charges of $23 million . For additional information, see Note 3 and Note 4. |
Schedule of Revenues by Geographic Region | The following table provides revenues by geographic area (a) : Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, United States $ 6,625 $ 4,433 Developed Europe (b) 2,370 2,312 Developed Rest of World (c) 1,520 1,493 Emerging Markets (d) 2,489 2,626 Revenues $ 13,005 $ 10,864 (a) On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. (b) Developed Europe region includes the following markets: Western Europe, Finland and the Scandinavian countries. Revenues denominated in euros were $1.8 billion in the first quarter of 2016 and $1.8 billion in the first quarter of 2015. (c) Developed Rest of World region includes the following markets: Australia, Canada, Japan, New Zealand and South Korea. (d) Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Africa, Eastern Europe, Central Europe, the Middle East and Turkey. |
Schedule of Significant Product Revenues | The following table provides detailed revenue information: Three Months Ended (MILLIONS OF DOLLARS) April 3, March 29, INNOVATIVE PRODUCTS BUSINESS (a) $ 7,033 $ 5,738 GIP (a) $ 3,640 $ 3,075 Lyrica GIP (b) 1,011 846 Enbrel (Outside the U.S. and Canada) 733 759 Viagra GIP (c) 300 288 Chantix/Champix 220 158 Xeljanz 197 96 BeneFIX 185 173 Refacto AF/Xyntha 129 120 Genotropin 125 138 Toviaz 64 63 Somavert 55 49 BMP2 51 38 Rapamune 45 53 Alliance revenues GIP (d), (l) 354 200 All other GIP 171 92 VOC (a) $ 3,394 $ 2,664 Prevnar/Prevenar 13 1,509 1,306 Ibrance 429 38 Sutent 278 242 Xalkori 139 111 Inlyta 101 95 All other V/O 117 63 Consumer Healthcare 822 808 ESTABLISHED PRODUCTS BUSINESS (e) $ 5,972 $ 5,125 Legacy Established Products (f) $ 2,800 $ 2,848 Lipitor 411 441 Premarin family 256 232 Norvasc 236 252 EpiPen 97 76 Xalatan/Xalacom 89 102 Zithromax/Zmax 80 79 Zoloft 79 86 Relpax 78 80 Effexor 70 73 Tikosyn 61 37 Xanax/Xanax XR 52 54 Cardura 45 52 Neurontin 44 55 All other Legacy Established Products (f), (l) 1,201 1,229 Peri-LOE Products (g) $ 1,090 $ 1,437 Lyrica GEP (b) 218 341 Pristiq 178 161 Celebrex 172 205 Vfend 156 182 Zyvox 127 271 Viagra GEP (c) 96 108 Revatio 66 63 All other Peri-LOE Products 76 107 Sterile Injectable Pharmaceuticals (h) $ 1,524 $ 729 Medrol 113 87 Sulperazon 96 98 Fragmin 78 74 Tygacil 76 74 All other Sterile Injectable Pharmaceuticals 1,161 396 Infusion Systems (i) $ 304 $ — Biosimilars (j) $ 66 $ — Pfizer CentreOne (k) $ 188 $ 111 Revenues $ 13,005 $ 10,864 Total Lyrica (b) $ 1,229 $ 1,187 Total Viagra (c) $ 396 $ 396 Total Alliance revenues (l) $ 360 $ 222 (a) The Innovative Products business is composed of two operating segments: GIP and VOC. (b) Lyrica revenues from all of Europe, Russia, Turkey, Israel and Central Asia countries are included in Lyrica-GEP. All other Lyrica revenues are included in Lyrica-GIP. Total Lyrica revenues represent the aggregate of worldwide revenues from Lyrica-GIP and Lyrica-GEP. (c) Viagra revenues from the U.S. and Canada are included in Viagra-GIP. All other Viagra revenues are included in Viagra-GEP. Total Viagra revenues represent the aggregate of worldwide revenues from Viagra-GIP and Viagra-GEP. (d) Includes Eliquis and Rebif. (e) The Established Products business consists of GEP, which includes all legacy Hospira commercial operations. Hospira's commercial operations, including the legacy Hospira One-2-One sterile injectables contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statement of income commencing from the acquisition date of September 3, 2015. As a result, revenues for the first quarter of 2015 and GEP's revenues for the first quarter of 2015 do not include Hospira's revenues. Also, effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) legacy Hospira's One-2-One sterile injectables contract manufacturing operation. Prior to 2016, PCS was managed outside our operating segments and its revenues were reported as other business activities. We have reclassified prior period PCS revenues ( $111 million in the first quarter of 2015) to conform to the current period presentation as part of GEP. (f) Legacy Established Products include products that have lost patent protection (excluding Sterile Injectable Pharmaceuticals and Peri-LOE Products). (g) Peri-LOE Products include products that have recently lost or are anticipated to soon lose patent protection. These products primarily include Celebrex and Zyvox in most developed markets, Lyrica in certain developed Europe markets, Pristiq globally and Inspra in the EU. (h) Sterile Injectable Pharmaceuticals include generic injectables and proprietary specialty injectables (excluding Peri-LOE Products). (i) Infusion Systems include Medication Management Systems products composed of infusion pumps and related software and services, as well as I.V. Infusion Products, including large volume I.V. solutions and their associated administration sets. (j) Biosimilars include Inflectra (biosimilar infliximab) in certain European markets, Nivestim (biosimilar filgrastim) in certain Asian markets and Retacrit (biosimilar epoetin zeta) in certain international markets. (k) Pfizer CentreOne includes (i) revenues from legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including revenues related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) revenues from legacy Hospira’s One-2-One sterile injectables contract manufacturing operation. For additional information, see (e) above. (l) Total Alliance revenues represent the aggregate of worldwide revenues from Alliance revenues GIP and Alliance revenues GEP, which is included in All other Legacy Established Products. |
Basis of Presentation and Sig32
Basis of Presentation and Significant Accounting Policies (Details) - USD ($) $ in Millions | Apr. 08, 2016 | Apr. 03, 2016 | Dec. 31, 2015 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | $ 76 | ||
Accounting Standards Update 2015-03 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | $ (79) | ||
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Payments of merger termination costs | $ 150 | ||
Other Current Assets [Member] | Accounting Standards Update 2015-03 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | (1) | ||
Other Noncurrent Assets [Member] | Accounting Standards Update 2015-03 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | (79) | ||
Short-term borrowings, including current portion of long-term debt [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | 1 | ||
Short-term borrowings, including current portion of long-term debt [Member] | Accounting Standards Update 2015-03 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | 1 | ||
Long-term debt [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | $ 75 | ||
Long-term debt [Member] | Accounting Standards Update 2015-03 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Debt issuance costs | $ 79 |
Acquisitions, Research and De33
Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments - Hospira Acquisition (Details) - USD ($) $ / shares in Units, $ in Millions | Sep. 03, 2015 | Apr. 03, 2016 | Mar. 29, 2015 | Dec. 31, 2015 | |
Business Acquisition [Line Items] | |||||
Cash payments for acquisition, net of cash acquired | [1] | $ 110 | $ 678 | ||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Goodwill | [2] | 48,558 | $ 48,242 | ||
Business Acquisition, Pro Forma Information [Abstract] | |||||
Net income (loss) | [3] | 3,016 | 2,376 | ||
Hospira [Member] | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, per share in cash (in dollars per share) | $ 90 | ||||
Payments for acquisitions, cash portion | $ 16,100 | ||||
Cash payments for acquisition, net of cash acquired | 15,700 | ||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Working capital, excluding inventories | 268 | ||||
Inventories | 1,908 | ||||
Property, plant and equipment | [4] | 2,357 | |||
Other noncurrent assets | 362 | ||||
Long-term debt | (1,928) | ||||
Benefit obligations | (117) | ||||
Net income tax accounts | (3,369) | ||||
Other noncurrent liabilities | (39) | ||||
Total identifiable net assets | 8,778 | ||||
Goodwill | 7,309 | ||||
Net assets acquired/total consideration transferred | 16,087 | ||||
Measurement Period Adjustments | |||||
Working capital, excluding inventories | (6) | ||||
Inventories | (16) | ||||
Property, plant and equipment | [4] | (53) | |||
Other noncurrent assets | (46) | ||||
Net income tax accounts | 25 | ||||
Total identifiable net assets | (25) | ||||
Goodwill | 25 | ||||
Net assets acquired/total consideration transferred | 0 | ||||
Business Acquisition, Pro Forma Information [Abstract] | |||||
Revenues | 12,039 | ||||
Net income attributable to Pfizer Inc. common shareholders | $ 2,375 | ||||
Diluted earnings per share attributable to Pfizer Inc. common shareholders (in dollars per share) | $ 0.38 | ||||
Additional amortization expense | $ 127 | ||||
Depreciation expense | 22 | ||||
Interest expense | 10 | ||||
Developed Technology Rights and Other [Member] | Hospira [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Identifiable intangible assets | [4] | 8,335 | |||
Measurement Period Adjustments | |||||
Identifiable intangible assets | [4] | 65 | |||
In Process Research and Development [Member] | Hospira [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Identifiable intangible assets | 1,000 | ||||
Measurement Period Adjustments | |||||
Identifiable intangible assets | $ 5 | ||||
Eliminations [Member] | Hospira [Member] | |||||
Business Acquisition, Pro Forma Information [Abstract] | |||||
Amortization expense | 12 | ||||
Eliminations [Member] | Fair Value Adjustment to Inventory [Member] | Hospira [Member] | |||||
Business Acquisition, Pro Forma Information [Abstract] | |||||
Net income (loss) | 5 | ||||
Eliminations [Member] | Acquisition-related Costs [Member] | Hospira [Member] | |||||
Business Acquisition, Pro Forma Information [Abstract] | |||||
Net income (loss) | $ 14 | ||||
Previously Reported [Member] | Hospira [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Working capital, excluding inventories | 274 | ||||
Inventories | 1,924 | ||||
Property, plant and equipment | [4] | 2,410 | |||
Other noncurrent assets | 408 | ||||
Long-term debt | (1,928) | ||||
Benefit obligations | (117) | ||||
Net income tax accounts | (3,394) | ||||
Other noncurrent liabilities | (39) | ||||
Total identifiable net assets | 8,803 | ||||
Goodwill | 7,284 | ||||
Net assets acquired/total consideration transferred | 16,087 | ||||
Previously Reported [Member] | Developed Technology Rights and Other [Member] | Hospira [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Identifiable intangible assets | [4] | 8,270 | |||
Previously Reported [Member] | In Process Research and Development [Member] | Hospira [Member] | |||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract] | |||||
Identifiable intangible assets | $ 995 | ||||
[1] | Amounts may not add due to rounding. | ||||
[2] | Amounts may not add due to rounding. | ||||
[3] | Amounts may not add due to rounding. | ||||
[4] | The measurement period adjustments for Identifiable intangible assets reflect changes in the estimated fair value of acquired finite-lived developed technology rights. The measurement period adjustments for Property, plant and equipment primarily reflect changes in the estimated fair value of acquired buildings and machinery and equipment. The changes in the estimated fair values for identifiable intangible assets and property, plant and equipment are primarily to better reflect market participant assumptions about facts and circumstances existing as of the acquisition date. The measurement period adjustments did not result from intervening events subsequent to the acquisition date. |
Acquisitions, Research and De34
Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments - Additional Acquisitions (Details) - USD ($) $ in Millions | Dec. 01, 2014 | Apr. 03, 2016 | Dec. 31, 2015 | |
Business Acquisition [Line Items] | ||||
Goodwill | [1] | $ 48,558 | $ 48,242 | |
Baxter International Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Total consideration transferred | $ 648 | |||
Intangible assets | 376 | |||
Inventories | 194 | |||
Goodwill | 12 | |||
Developed Technology Rights [Member] | Baxter International Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 371 | |||
[1] | Amounts may not add due to rounding. |
Acquisitions, Research and De35
Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments - Resarch and Development and Collaborative Arrangements (Details) patient in Thousands | 1 Months Ended | 3 Months Ended | |||
Jan. 31, 2016USD ($) | Jul. 31, 2015studypatient | Mar. 31, 2015USD ($) | Feb. 28, 2015USD ($) | Apr. 03, 2016USD ($) | |
RPI Finance Trust [Member] | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Research and development arrangement, amount | $ 300,000,000 | ||||
Research and development arrangement, contingent payments, maximum | $ 250,000,000 | ||||
Research and development arrangement, term | 7 years | ||||
Research and development arrangement, percentage of costs to be reimbursed (up to) | 100.00% | ||||
Funding to offset costs incurred under research and development arrangement | $ 8,800,000 | ||||
OPKO Health, Inc. [Member] | Collaborative Arrangement [Member] | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Upfront payments and milestone payments | $ 295,000,000 | ||||
Contingent collaborative arrangement payments | $ 275,000,000 | ||||
Eli Lilly & Company (Lilly) [Member] | Collaborative Arrangement [Member] | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Number of studies | study | 6 | ||||
Number of patients | patient | 7 | ||||
Deferred Revenue [Member] | Eli Lilly & Company (Lilly) [Member] | Collaborative Arrangement [Member] | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |||||
Upfront payments received | $ 200,000,000 |
Acquisitions, Research and De36
Acquisitions, Research and Development and Collaborative Arrangements, and Equity-Method Investments - Equity-Method Investments (Details) $ in Millions | 3 Months Ended |
Apr. 03, 2016USD ($) | |
Hisun Pfizer Pharmaceuticals Co. Ltd [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Equity method investment, ownership percentage | 49.00% |
Equity Method Investments | $ 680 |
Hisun Pfizer Pharmaceuticals Co. Ltd [Member] | Other Nonoperating Income (Expense) [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Equity method investment, impairment | $ 81 |
Laboratorio Teuto Brasilero [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Equity method investment, ownership percentage | 40.00% |
Laboratorio Teuto Brasilero [Member] | Other Nonoperating Income (Expense) [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Equity method investment, impairment | $ 50 |
Discounted Cash Flows Technique [Member] | Hisun Pfizer Pharmaceuticals Co. Ltd [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Discount rate | 13.00% |
Discounted Cash Flows Technique [Member] | Laboratorio Teuto Brasilero [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Discount rate | 17.50% |
Laboratorio Teuto Brasilero [Member] | Laboratorio Teuto Brasilero [Member] | |
Schedule of Equity Method Investments [Line Items] | |
Ownership percentage | 60.00% |
Restructuring Charges and Oth37
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives (Detail) $ in Millions | Sep. 03, 2015 | Apr. 03, 2016USD ($)site | Mar. 29, 2015USD ($) | Dec. 31, 2015USD ($) | Sep. 03, 2018USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||||
Expected restructuring cost | $ 2,500 | |||||
Percentage of non-cash restructuring charges expected | 25.00% | |||||
Total costs associated with acquisitions and cost-reduction/productivity initiatives | $ 228 | |||||
Restructuring charges: | ||||||
Employee terminations | [1] | 24 | $ 31 | |||
Asset impairments | [1] | 1 | 6 | |||
Exit costs | [1] | 4 | 6 | |||
Total restructuring charges | [1] | 30 | 42 | |||
Transaction costs | [2] | 24 | 5 | |||
Integration costs | [3] | 87 | 13 | |||
Restructuring charges and certain acquisition-related costs | [4] | 141 | 60 | |||
Total additional depreciation––asset restructuring | [5] | 49 | 18 | |||
Implementation costs recorded in our condensed consolidated statements of income as follows: | ||||||
Total implementation costs | [6] | 62 | 48 | |||
Total costs associated with acquisitions and cost-reduction/productivity initiatives | 252 | 127 | ||||
Cost of Sales [Member] | ||||||
Restructuring charges: | ||||||
Total additional depreciation––asset restructuring | [5] | 45 | 17 | |||
Implementation costs recorded in our condensed consolidated statements of income as follows: | ||||||
Total implementation costs | [6] | 43 | 13 | |||
Selling, Informational and Administrative Expenses [Member] | ||||||
Implementation costs recorded in our condensed consolidated statements of income as follows: | ||||||
Total implementation costs | [6] | 12 | 26 | |||
Research and Development Expense [Member] | ||||||
Restructuring charges: | ||||||
Total additional depreciation––asset restructuring | [5] | 4 | 1 | |||
Implementation costs recorded in our condensed consolidated statements of income as follows: | ||||||
Total implementation costs | [6] | $ 6 | $ 8 | |||
Manufacturing Plant Network Rationalization And Optimization [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expected number of sites exited | site | 4 | |||||
Acquisition-related Costs [Member] | Manufacturing Plant Network Rationalization And Optimization [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expected restructuring cost | $ 400 | |||||
Restructuring costs incurred | 357 | |||||
Facility Closing [Member] | Manufacturing Plant Network Rationalization And Optimization [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expected restructuring cost | 1,000 | |||||
Restructuring costs incurred | 570 | |||||
Business Restructuring Reserves [Member] | Global Commercial Structure Reorganization [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expected restructuring cost | 225 | |||||
Restructuring costs incurred | 219 | |||||
Commercial Real Estate [Member] | Other Cost Reduction / Productivity Initiatives [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expected restructuring cost | 850 | |||||
Restructuring costs incurred | $ 532 | |||||
Hospira [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expected integration related costs, period | 3 years | |||||
Hospira [Member] | Return of Acquired Rights [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring cost incurred | $ 215 | |||||
Forecast [Member] | Hospira [Member] | ||||||
Restructuring charges: | ||||||
Integration costs | $ 1,000 | |||||
[1] | In the three months ended April 3, 2016, Employee terminations represent the expected reduction of the workforce by approximately 100 employees, mainly in manufacturing. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.The restructuring charges for the three months ended April 3, 2016 are associated with the following:•the Global Innovative Pharmaceutical segment (GIP) ($8 million); the Global Vaccines, Oncology and Consumer Healthcare segment (VOC) ($1 million); the Global Established Pharmaceutical segment (GEP) ($3 million); Worldwide Research and Development and Medical (WRD/M) ($3 million); manufacturing operations ($14 million); and Corporate ($1 million).The restructuring charges for the three months ended March 29, 2015 are associated with the following:•GIP ($12 million); VOC ($13 million); GEP ($10 million); WRD/M ($12 million); manufacturing operations ($22 million income); and Corporate ($18 million). | |||||
[2] | Transaction costs represent external costs for banking, legal, accounting and other similar services, most of which are directly related to the terminated transaction with Allergan. | |||||
[3] | Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes, primarily related to the acquisition of Hospira. | |||||
[4] | Amounts may not add due to rounding. | |||||
[5] | Additional depreciation––asset restructuring represents the impact of changes in the estimated useful lives of assets involved in restructuring actions. | |||||
[6] | Implementation costs represent external, incremental costs directly related to implementing our non-acquisition-related cost-reduction/productivity initiatives. |
Restructuring Charges and Oth38
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Footnotes (Details) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016USD ($)Employee | Mar. 29, 2015USD ($) | ||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and related cost, expected number of positions eliminated (in number of employees) | Employee | 100 | ||
Restructuring charges | [1] | $ 30 | $ 42 |
Worldwide Research and Development Expense [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 3 | 12 | |
Manufacturing Operations [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 14 | (22) | |
Corporate [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 1 | 18 | |
Global Innovative Pharmaceutical [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 8 | 12 | |
Global Vaccines, Oncology and Consumer Healthcare [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 1 | 13 | |
Global Established Pharmaceutical [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 3 | $ 10 | |
[1] | In the three months ended April 3, 2016, Employee terminations represent the expected reduction of the workforce by approximately 100 employees, mainly in manufacturing. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.The restructuring charges for the three months ended April 3, 2016 are associated with the following:•the Global Innovative Pharmaceutical segment (GIP) ($8 million); the Global Vaccines, Oncology and Consumer Healthcare segment (VOC) ($1 million); the Global Established Pharmaceutical segment (GEP) ($3 million); Worldwide Research and Development and Medical (WRD/M) ($3 million); manufacturing operations ($14 million); and Corporate ($1 million).The restructuring charges for the three months ended March 29, 2015 are associated with the following:•GIP ($12 million); VOC ($13 million); GEP ($10 million); WRD/M ($12 million); manufacturing operations ($22 million income); and Corporate ($18 million). |
Restructuring Charges and Oth39
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Restructuring Accruals (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Restructuring Reserve [Roll Forward] | |||
Balance, December 31, 2015 | [1] | $ 1,157 | |
Provision | [2] | 30 | $ 42 |
Utilization and other | [3] | (175) | |
Balance, April 3, 2016 | [4] | 1,011 | |
Employee Termination Costs [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Balance, December 31, 2015 | [1] | 1,109 | |
Provision | 24 | ||
Utilization and other | [3] | (165) | |
Balance, April 3, 2016 | [4] | 968 | |
Asset Impairment Charges [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Balance, December 31, 2015 | [1] | 0 | |
Provision | 1 | ||
Utilization and other | [3] | (1) | |
Balance, April 3, 2016 | [4] | 0 | |
Exit Costs [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Balance, December 31, 2015 | [1] | 48 | |
Provision | 4 | ||
Utilization and other | [3] | (9) | |
Balance, April 3, 2016 | [4] | $ 43 | |
[1] | Included in Other current liabilities ($776 million) and Other noncurrent liabilities ($381 million). | ||
[2] | In the three months ended April 3, 2016, Employee terminations represent the expected reduction of the workforce by approximately 100 employees, mainly in manufacturing. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.The restructuring charges for the three months ended April 3, 2016 are associated with the following:•the Global Innovative Pharmaceutical segment (GIP) ($8 million); the Global Vaccines, Oncology and Consumer Healthcare segment (VOC) ($1 million); the Global Established Pharmaceutical segment (GEP) ($3 million); Worldwide Research and Development and Medical (WRD/M) ($3 million); manufacturing operations ($14 million); and Corporate ($1 million).The restructuring charges for the three months ended March 29, 2015 are associated with the following:•GIP ($12 million); VOC ($13 million); GEP ($10 million); WRD/M ($12 million); manufacturing operations ($22 million income); and Corporate ($18 million). | ||
[3] | Includes adjustments for foreign currency translation. | ||
[4] | Included in Other current liabilities ($638 million) and Other noncurrent liabilities ($373 million). |
Restructuring Charges and Oth40
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Restructuring Accruals - Footnotes (Detail) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 | ||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve | $ 1,011 | [1] | $ 1,157 | [2] |
Other Current Liabilities [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve | 638 | 776 | ||
Other Noncurrent Liabilities [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve | $ 373 | $ 381 | ||
[1] | Included in Other current liabilities ($638 million) and Other noncurrent liabilities ($373 million). | |||
[2] | Included in Other current liabilities ($776 million) and Other noncurrent liabilities ($381 million). |
Other (Income)_Deductions - N41
Other (Income)/Deductions - Net (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Other Income and Expenses [Abstract] | |||
Interest income | [1] | $ (113) | $ (93) |
Interest expense | 306 | 309 | |
Net interest expense | 193 | 216 | |
Royalty-related income | (187) | (222) | |
Certain legal matters, net | [2] | 274 | 0 |
Net gains on asset disposals | [3] | (9) | (175) |
Certain asset impairments | [4] | 131 | 0 |
Business and legal entity alignment costs | [5] | 51 | 101 |
Other, net | [6] | (122) | 34 |
Other (income)/deductions––net | [7] | $ 330 | $ (46) |
[1] | Interest income increased in the first quarter of 2016, primarily due to higher investment returns. | ||
[2] | In the first quarter of 2016, primarily includes an accrual for an unresolved legal matter and a settlement related to a patent matter. | ||
[3] | In the first quarter of 2016, primarily includes gains on sales/out-licensing of product and compound rights (approximately $16 million). In the first quarter of 2015, primarily includes gains on sales/out-licensing of product and compound rights (approximately $45 million) and gains on sales of investments in equity securities (approximately $120 million). | ||
[4] | In the first quarter of 2016, represents an impairment loss of $81 million related to Pfizer’s 49%-owned equity-method investment with Zhejiang Hisun Pharmaceuticals Co., Ltd. (Hisun) in China, Hisun Pfizer, and an impairment loss of $50 million related to Pfizer's 40%-owned equity-method investment in Teuto. For additional information concerning Hisun Pfizer and Teuto, see Note 2C. | ||
[5] | In the first quarter of 2016 and 2015, represents expenses for changes to our infrastructure to align our commercial operations, including costs to internally separate our businesses into distinct legal entities, as well as to streamline our intercompany supply operations to better support each business. | ||
[6] | In the first quarter of 2016, primarily includes, among other things, income of $116 million from resolution of a contract disagreement. | ||
[7] | Amounts may not add due to rounding. |
Other (Income)_Deductions - N42
Other (Income)/Deductions - Net (Footnotes) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 03, 2016 | Mar. 29, 2015 | |
Loss Contingencies [Line Items] | ||
Gain on sale of investments | $ 120 | |
Income from contract resolution | $ 116 | |
Distribution Rights [Member] | ||
Loss Contingencies [Line Items] | ||
Gain (loss) on disposition of intangible assets | $ 16 | $ 45 |
Hisun Pfizer Pharmaceuticals Co. Ltd [Member] | ||
Loss Contingencies [Line Items] | ||
Equity method investment, ownership percentage | 49.00% | |
Laboratorio Teuto Brasilero [Member] | ||
Loss Contingencies [Line Items] | ||
Equity method investment, ownership percentage | 40.00% | |
Other Nonoperating Income (Expense) [Member] | Hisun Pfizer Pharmaceuticals Co. Ltd [Member] | ||
Loss Contingencies [Line Items] | ||
Equity method investment, impairment | $ 81 | |
Other Nonoperating Income (Expense) [Member] | Laboratorio Teuto Brasilero [Member] | ||
Loss Contingencies [Line Items] | ||
Equity method investment, impairment | $ 50 |
Tax Matters - Narrative (Detail
Tax Matters - Narrative (Detail) | 3 Months Ended | |
Apr. 03, 2016 | Mar. 29, 2015 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate for income from continuing operations | 15.00% | 22.90% |
Tax Matters (Detail)
Tax Matters (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Income Tax Disclosure [Abstract] | |||
Foreign currency translation adjustments, net | [1] | $ (14) | $ 85 |
Unrealized holding losses on derivative financial instruments, net | (36) | (224) | |
Reclassification adjustments for realized (gains)/losses | (72) | 183 | |
Derivatives qualifying as hedges, tax, total | (108) | (41) | |
Unrealized holding gains/(losses) on available-for-sale securities, net | 17 | (31) | |
Reclassification adjustments for realized losses | 26 | (1) | |
Available-for-sale securities, tax, total | 43 | (32) | |
Benefit plans: actuarial gains, net | 0 | 12 | |
Reclassification adjustments related to amortization | 47 | 46 | |
Reclassification adjustments related to settlements, net | 9 | 15 | |
Other | (1) | 37 | |
Defined benefit plans, actuarial gain (loss), tax, total | 55 | 109 | |
Benefit plans: prior service costs and other, net | 0 | 0 | |
Reclassification adjustments related to amortization | (15) | (13) | |
Reclassification adjustments related to curtailments, net | (2) | (4) | |
Other | 1 | 0 | |
Pension and other postretirement benefit plans, net prior service cost (credit), tax | (16) | (17) | |
Tax provision/(benefit) on other comprehensive loss | [2],[3] | $ (41) | $ 105 |
[1] | Taxes are not provided for foreign currency translation adjustments relating to investments in international subsidiaries that will be held indefinitely. | ||
[2] | Amounts may not add due to rounding. | ||
[3] | See Note 5C. Tax Matters: Tax Provision/(Benefit) on Other Comprehensive Loss. |
Accumulated Other Comprehensi45
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests (Detail) $ in Millions | 3 Months Ended | |
Apr. 03, 2016USD ($) | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance, December 31, 2015 | $ 64,720 | [1] |
Other comprehensive income/(loss) | 2 | [2] |
Balance, April 3, 2016 | 63,068 | [1] |
Foreign currency translation adjustments attributable to noncontrolling interests | (6) | |
Accumulated Other Comprehensive Income (Loss) [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance, December 31, 2015 | (9,522) | |
Balance, April 3, 2016 | (9,520) | |
Foreign Currency Translation Adjustment [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance, December 31, 2015 | (5,863) | |
Other comprehensive income/(loss) | 87 | [2] |
Balance, April 3, 2016 | (5,776) | |
Derivative Financial Instruments [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance, December 31, 2015 | 421 | |
Other comprehensive income/(loss) | (504) | [2] |
Balance, April 3, 2016 | (83) | |
Cash flow hedge gain (loss) to be reclassified within twelve months | (144) | |
Available-For-Sale Securities [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance, December 31, 2015 | (227) | |
Other comprehensive income/(loss) | 296 | [2] |
Balance, April 3, 2016 | 69 | |
Actuarial Gains/(Losses) [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance, December 31, 2015 | (4,733) | |
Other comprehensive income/(loss) | 148 | [2] |
Balance, April 3, 2016 | (4,585) | |
Prior Service (Costs)/Credits and Other [Member] | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance, December 31, 2015 | 880 | |
Other comprehensive income/(loss) | (25) | [2] |
Balance, April 3, 2016 | $ 855 | |
[1] | Amounts may not add due to rounding. | |
[2] | Amounts do not include foreign currency translation adjustments attributable to noncontrolling interests of $6 million loss for the first three months of 2016. |
Financial Instruments - Assets
Financial Instruments - Assets and Liabilities Measured on Recurring Basis (Detail) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 | |
Other selected financial assets | |||
Total selected financial assets | $ 33,705 | $ 38,157 | |
Other selected financial liabilities | |||
Short-term borrowings, carried at historical proceeds, as adjusted | [1] | 11,546 | 10,159 |
Long-term debt, carried at historical proceeds, as adjusted | [1] | 27,824 | 28,740 |
Total selected financial liabilities | 41,122 | 40,608 | |
Reported Value Measurement [Member] | |||
Other selected financial assets | |||
Held-to-maturity debt securities, carried at amortized cost | [2],[3] | 1,065 | 1,388 |
Private equity securities, carried at equity-method or at cost | [3],[4] | 1,250 | 1,336 |
Total | 2,315 | 2,724 | |
Other selected financial liabilities | |||
Short-term borrowings, carried at historical proceeds, as adjusted | [3],[5],[6] | 11,546 | 10,159 |
Long-term debt, carried at historical proceeds, as adjusted | [5],[6],[7] | 27,824 | 28,740 |
Total | [5] | 39,370 | 38,899 |
Fair Value, Measurements, Recurring [Member] | |||
Assets, Fair Value Disclosure [Abstract] | |||
Trading funds | [8],[9] | 260 | 287 |
Selected financial assets measured at fair value on a recurring basis | [10] | 31,391 | 35,433 |
Selected financial liabilities measured at fair value on a recurring basis | |||
Derivative financial instruments in a liability position | [9],[11] | 1,752 | 1,709 |
Fair Value, Measurements, Recurring [Member] | Interest Rate Swaps [Member] | |||
Assets, Fair Value Disclosure [Abstract] | |||
Derivative financial instruments in a receivable position | [10] | 1,433 | 837 |
Selected financial liabilities measured at fair value on a recurring basis | |||
Derivative financial instruments in a liability position | [9],[11] | 9 | 139 |
Fair Value, Measurements, Recurring [Member] | Foreign Currency Swap [Member] | |||
Assets, Fair Value Disclosure [Abstract] | |||
Derivative financial instruments in a receivable position | [10] | 103 | 135 |
Selected financial liabilities measured at fair value on a recurring basis | |||
Derivative financial instruments in a liability position | [9],[11] | 1,311 | 1,489 |
Fair Value, Measurements, Recurring [Member] | Foreign Currency Forward-Exchange Contracts [Member] | |||
Assets, Fair Value Disclosure [Abstract] | |||
Derivative financial instruments in a receivable position | [10] | 333 | 559 |
Selected financial liabilities measured at fair value on a recurring basis | |||
Derivative financial instruments in a liability position | [9],[11] | 432 | 81 |
Fair Value, Measurements, Recurring [Member] | Debt Securities [Member] | |||
Assets, Fair Value Disclosure [Abstract] | |||
Available-for-sale securities | [2],[9] | 27,819 | 32,078 |
Fair Value, Measurements, Recurring [Member] | Money Market Funds [Member] | |||
Assets, Fair Value Disclosure [Abstract] | |||
Available-for-sale securities | [9] | 947 | 934 |
Fair Value, Measurements, Recurring [Member] | Equity Securities [Member] | |||
Assets, Fair Value Disclosure [Abstract] | |||
Available-for-sale securities | [2],[9] | $ 497 | $ 603 |
[1] | Amounts may not add due to rounding. | ||
[2] | Gross unrealized gains and losses are not significant. | ||
[3] | Short-term borrowings include foreign currency short-term borrowings with fair values of $547 million as of December 31, 2015, which are used as hedging instruments. The differences between the estimated fair values and carrying values of held-to-maturity debt securities, private equity securities at cost and short-term borrowings not measured at fair value on a recurring basis were not significant as of April 3, 2016 or December 31, 2015. The fair value measurements of our held-to-maturity debt securities and our short-term borrowings are based on Level 2 inputs, using a market approach. The fair value measurements of our private equity securities carried at cost are based on Level 3 inputs. | ||
[4] | Our private equity securities represent investments in the life sciences sector. | ||
[5] | Some carrying amounts may include adjustments for discount or premium amortization or for the effect of hedging the interest rate fair value risk associated with certain financial liabilities by interest rate swaps. | ||
[6] | We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016, debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ($1 million) and Long-term debt ($75 million). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ($1 million from Other current assets and $79 million from Other noncurrent assets) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ($1 million) and Long-term debt ($79 million) to conform to the current period presentation. | ||
[7] | The fair value of our long-term debt (not including the current portion of long-term debt) was $31.8 billion as of April 3, 2016 and $32.7 billion as of December 31, 2015. The fair value measurements for our long-term debt are based on Level 2 inputs, using a market approach. Generally, the difference between the fair value of our long-term debt and the amount reported on the condensed consolidated balance sheet is due to a decline in relative market interest rates since the debt issuance. | ||
[8] | As of April 3, 2016, trading funds are composed of $204 million of trading equity funds and $56 million of trading debt funds. As of December 31, 2015, trading funds are composed of $185 million of trading equity funds and $102 million of trading debt funds. As of April 3, 2016 and December 31, 2015, trading equity funds of $65 million and $85 million, respectively, are held in trust for benefits attributable to the former Pharmacia Savings Plus Plan. | ||
[9] | We use a market approach in valuing financial instruments on a recurring basis. For additional information, see Note 1C. All of our financial assets and liabilities measured at fair value on a recurring basis use Level 2 inputs in the calculation of fair value, except less than 1% that use Level 1 inputs and money market funds measured at net asset value. | ||
[10] | Designated as hedging instruments, except for certain contracts used as offsets; namely, foreign currency forward-exchange contracts with fair values of $144 million as of April 3, 2016; and foreign currency forward-exchange contracts with fair values of $136 million as of December 31, 2015. | ||
[11] | Designated as hedging instruments, except for certain contracts used as offsets; namely, foreign currency swaps with fair values of $188 million and foreign currency forward-exchange contracts with fair values of $117 million as of April 3, 2016; and foreign currency swaps with fair values of $234 million and foreign currency forward-exchange contracts with fair values of $59 million as of December 31, 2015. |
Financial Instruments - Asset47
Financial Instruments - Assets and Liabilities Measured on Recurring Basis (Footnotes) (Detail) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 |
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | $ 76 | |
Fair Value, Measurements, Recurring [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Trading equity funds | 204 | $ 185 |
Trading debt funds | 56 | 102 |
Trading securities held in trust | 65 | 85 |
Not Designated as Hedging Instrument [Member] | Foreign Currency Swap [Member] | Fair Value, Measurements, Recurring [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Instruments used as offsets (liabilities) | 188 | 234 |
Not Designated as Hedging Instrument [Member] | Foreign Currency Forward-Exchange Contracts [Member] | Fair Value, Measurements, Recurring [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Instruments used as offsets (assets) | 144 | 136 |
Instruments used as offsets (liabilities) | $ 117 | 59 |
Maximum [Member] | Fair Value, Measurements, Recurring [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Percentage of financial assets and liabilities measured at fair value inputs Level 1 and Level 3 inputs | 1.00% | |
Level 2 [Member] | Estimate of Fair Value Measurement [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Fair value of long-term debt | $ 31,800 | 32,700 |
Foreign Currency Short Term Borrowings [Member] | Designated as Hedging Instrument [Member] | Estimate of Fair Value Measurement [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Fair value of short-term debt | 547 | |
Accounting Standards Update 2015-03 [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | (79) | |
Short-term borrowings, including current portion of long-term debt [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | 1 | |
Short-term borrowings, including current portion of long-term debt [Member] | Accounting Standards Update 2015-03 [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | 1 | |
Long-term debt [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | $ 75 | |
Long-term debt [Member] | Accounting Standards Update 2015-03 [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | 79 | |
Other Current Assets [Member] | Accounting Standards Update 2015-03 [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | (1) | |
Other Noncurrent Assets [Member] | Accounting Standards Update 2015-03 [Member] | ||
Footnotes to selected financial assets and liabilities: | ||
Debt issuance costs | $ (79) |
Financial Instruments - Balance
Financial Instruments - Balance Sheet Grouping (Detail) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 | |
Assets | |||
Selected financial assets | $ 33,705 | $ 38,157 | |
Liabilities | |||
Selected financial liabilities | 41,122 | 40,608 | |
Cash and Cash Equivalents [Member] | |||
Assets | |||
Selected financial assets | 809 | 978 | |
Short-term Investments [Member] | |||
Assets | |||
Selected financial assets | 16,882 | 19,649 | |
Long-term Investments [Member] | |||
Assets | |||
Selected financial assets | 14,146 | 15,999 | |
Other Current Assets [Member] | |||
Assets | |||
Selected financial assets | [1] | 390 | 587 |
Other Noncurrent Assets [Member] | |||
Assets | |||
Selected financial assets | [2] | 1,478 | 944 |
Short-Term Borrowings, Including Current Portion of Long-Term Debt [Member] | |||
Liabilities | |||
Selected financial liabilities | [3] | 11,546 | 10,159 |
Other Current Liabilities [Member] | |||
Liabilities | |||
Selected financial liabilities | [4] | 862 | 645 |
Long-term debt [Member] | |||
Liabilities | |||
Selected financial liabilities | [3] | 27,824 | 28,740 |
Other Noncurrent Liabilities [Member] | |||
Liabilities | |||
Selected financial liabilities | [5] | $ 890 | $ 1,064 |
[1] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($5 million), foreign currency swaps ($62 million) and foreign currency forward-exchange contracts ($323 million) and, as of December 31, 2015, include interest rate swaps ($2 million), foreign currency swaps ($46 million) and foreign currency forward-exchange contracts ($538 million). | ||
[2] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($1,428 million), foreign currency swaps ($41 million) and foreign currency forward-exchange contracts ($9 million) and, as of December 31, 2015, include interest rate swaps ($835 million), foreign currency swaps ($89 million) and foreign currency forward-exchange contracts ($20 million). | ||
[3] | We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016, debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ($1 million) and Long-term debt ($75 million). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ($1 million from Other current assets and $79 million from Other noncurrent assets) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ($1 million) and Long-term debt ($79 million) to conform to the current period presentation. | ||
[4] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($5 million), foreign currency swaps ($454 million) and foreign currency forward-exchange contracts ($403 million) and, as of December 31, 2015, include interest rate swaps ($5 million), foreign currency swaps ($560 million) and foreign currency forward-exchange contracts ($80 million). | ||
[5] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($4 million), foreign currency swaps ($857 million) and foreign currency forward-exchange contracts ($29 million) and, as of December 31, 2015, include interest rate swaps ($134 million), foreign currency swaps ($928 million) and foreign currency forward-exchange contracts ($1 million). |
Financial Instruments - Balan49
Financial Instruments - Balance Sheet Grouping - Footnotes (Detail) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | $ 33,705 | $ 38,157 | |
Debt issuance costs | 76 | ||
Selected financial liabilities | 41,122 | 40,608 | |
Other Current Assets [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | [1] | 390 | 587 |
Other Current Assets [Member] | Interest Rate Swaps [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | 5 | 2 | |
Other Current Assets [Member] | Foreign Currency Swap [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | 62 | 46 | |
Other Current Assets [Member] | Foreign Currency Forward-Exchange Contracts [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | 323 | 538 | |
Other Noncurrent Assets [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | [2] | 1,478 | 944 |
Other Noncurrent Assets [Member] | Interest Rate Swaps [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | 1,428 | 835 | |
Other Noncurrent Assets [Member] | Foreign Currency Swap [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | 41 | 89 | |
Other Noncurrent Assets [Member] | Foreign Currency Forward-Exchange Contracts [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial assets | 9 | 20 | |
Short-term borrowings, including current portion of long-term debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt issuance costs | 1 | ||
Long-term debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt issuance costs | 75 | ||
Selected financial liabilities | [3] | 27,824 | 28,740 |
Other Current Liabilities [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | [4] | 862 | 645 |
Other Current Liabilities [Member] | Interest Rate Swaps [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | 5 | 5 | |
Other Current Liabilities [Member] | Foreign Currency Swap [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | 454 | 560 | |
Other Current Liabilities [Member] | Foreign Currency Forward-Exchange Contracts [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | 403 | 80 | |
Other Noncurrent Liabilities [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | [5] | 890 | 1,064 |
Other Noncurrent Liabilities [Member] | Interest Rate Swaps [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | 4 | 134 | |
Other Noncurrent Liabilities [Member] | Foreign Currency Swap [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | 857 | 928 | |
Other Noncurrent Liabilities [Member] | Foreign Currency Forward-Exchange Contracts [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Selected financial liabilities | $ 29 | 1 | |
Accounting Standards Update 2015-03 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt issuance costs | (79) | ||
Accounting Standards Update 2015-03 [Member] | Other Current Assets [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt issuance costs | (1) | ||
Accounting Standards Update 2015-03 [Member] | Other Noncurrent Assets [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt issuance costs | (79) | ||
Accounting Standards Update 2015-03 [Member] | Short-term borrowings, including current portion of long-term debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt issuance costs | 1 | ||
Accounting Standards Update 2015-03 [Member] | Long-term debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt issuance costs | $ 79 | ||
[1] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($5 million), foreign currency swaps ($62 million) and foreign currency forward-exchange contracts ($323 million) and, as of December 31, 2015, include interest rate swaps ($2 million), foreign currency swaps ($46 million) and foreign currency forward-exchange contracts ($538 million). | ||
[2] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($1,428 million), foreign currency swaps ($41 million) and foreign currency forward-exchange contracts ($9 million) and, as of December 31, 2015, include interest rate swaps ($835 million), foreign currency swaps ($89 million) and foreign currency forward-exchange contracts ($20 million). | ||
[3] | We adopted a new standard as of January 1, 2016 that changed the presentation of debt issuance costs related to a recognized debt liability as a direct deduction from the carrying value of that associated debt, consistent with the presentation of a debt discount. The update does not impact the measurement or recognition of debt issuance costs. As of April 3, 2016, debt issuance costs are $76 million and are presented as contra-liabilities to Short-term borrowings, including current portion of long-term debt ($1 million) and Long-term debt ($75 million). In the December 31, 2015 condensed consolidated balance sheet, we have reclassified debt issuance costs of $79 million ($1 million from Other current assets and $79 million from Other noncurrent assets) and have presented them as contra-liabilities to Short-term borrowings, including current portion of long-term debt ($1 million) and Long-term debt ($79 million) to conform to the current period presentation. | ||
[4] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($5 million), foreign currency swaps ($454 million) and foreign currency forward-exchange contracts ($403 million) and, as of December 31, 2015, include interest rate swaps ($5 million), foreign currency swaps ($560 million) and foreign currency forward-exchange contracts ($80 million). | ||
[5] | As of April 3, 2016, derivative instruments at fair value include interest rate swaps ($4 million), foreign currency swaps ($857 million) and foreign currency forward-exchange contracts ($29 million) and, as of December 31, 2015, include interest rate swaps ($134 million), foreign currency swaps ($928 million) and foreign currency forward-exchange contracts ($1 million). |
Financial Instruments - Investm
Financial Instruments - Investments in Debt Securities (Detail) $ in Millions | Apr. 03, 2016USD ($) | |
Schedule of Investments [Line Items] | ||
Debt securities maturities within one year | $ 16,744 | |
Debt securities maturities over 1 to 5 years | 10,109 | |
Debt securities maturities over 5 to 10 years | 2,001 | |
Debt securities maturities after 10 years | 31 | |
Total debt securities | 28,884 | |
Western European, Asian, Scandinavian and Other Government Debt [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 7,056 | [1] |
Available-for-sale debt securities maturities over 1 to 5 years | 1,033 | [1] |
Available-for-sale debt securities maturities over 5 to 10 years | 8 | [1] |
Available-for-sale debt securities maturities over 10 years | 0 | [1] |
Available-for-sale debt securities maturities total | 8,097 | [1] |
Corporate debt [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 3,223 | [2] |
Available-for-sale debt securities maturities over 1 to 5 years | 4,786 | [2] |
Available-for-sale debt securities maturities over 5 to 10 years | 1,656 | [2] |
Available-for-sale debt securities maturities over 10 years | 15 | [2] |
Available-for-sale debt securities maturities total | 9,680 | [2] |
U.S. government debt [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 1,812 | |
Available-for-sale debt securities maturities over 1 to 5 years | 848 | |
Available-for-sale debt securities maturities over 5 to 10 years | 207 | |
Available-for-sale debt securities maturities over 10 years | 0 | |
Available-for-sale debt securities maturities total | 2,867 | |
Federal Home Loan Mortgage Corporation and Federal National Mortgage Association asset-backed securities [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 34 | |
Available-for-sale debt securities maturities over 1 to 5 years | 2,110 | |
Available-for-sale debt securities maturities over 5 to 10 years | 71 | |
Available-for-sale debt securities maturities over 10 years | 11 | |
Available-for-sale debt securities maturities total | 2,227 | |
Western European, Scandinavian and Other Government Agency Debt [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 1,587 | [1] |
Available-for-sale debt securities maturities over 1 to 5 years | 210 | [1] |
Available-for-sale debt securities maturities over 5 to 10 years | 0 | [1] |
Available-for-sale debt securities maturities over 10 years | 0 | [1] |
Available-for-sale debt securities maturities total | 1,797 | [1] |
Supranational Debt [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 911 | [1] |
Available-for-sale debt securities maturities over 1 to 5 years | 323 | [1] |
Available-for-sale debt securities maturities over 5 to 10 years | 0 | [1] |
Available-for-sale debt securities maturities over 10 years | 0 | [1] |
Available-for-sale debt securities maturities total | 1,234 | [1] |
Government National Mortgage Association and other U.S. government guaranteed asset-back securities [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 599 | |
Available-for-sale debt securities maturities over 1 to 5 years | 112 | |
Available-for-sale debt securities maturities over 5 to 10 years | 18 | |
Available-for-sale debt securities maturities over 10 years | 0 | |
Available-for-sale debt securities maturities total | 729 | |
Other asset-backed debt [Member] | ||
Schedule of Investments [Line Items] | ||
Available-for-sale debt securities maturities within 1 year | 461 | [3] |
Available-for-sale debt securities maturities over 1 to 5 years | 682 | [3] |
Available-for-sale debt securities maturities over 5 to 10 years | 40 | [3] |
Available-for-sale debt securities maturities over 10 years | 4 | [3] |
Available-for-sale debt securities maturities total | 1,188 | [3] |
Time deposits and other [Member] | ||
Schedule of Investments [Line Items] | ||
Held-to-maturity debt securities maturities within 1 year | 1,024 | |
Held-to-maturity debt securities with maturities over 1 to 5 years | 5 | |
Held-to-maturity debt securities maturities over 5 to 10 years | 0 | |
Held-to-maturity debt securities maturities over 10 years | 0 | |
Held-to-maturity debt securities maturities total | 1,029 | |
Western European Government Debt [Member] | ||
Schedule of Investments [Line Items] | ||
Held-to-maturity debt securities maturities within 1 year | 36 | [1] |
Held-to-maturity debt securities with maturities over 1 to 5 years | 0 | [1] |
Held-to-maturity debt securities maturities over 5 to 10 years | 0 | [1] |
Held-to-maturity debt securities maturities over 10 years | 0 | [1] |
Held-to-maturity debt securities maturities total | $ 36 | [1] |
[1] | Issued by governments, government agencies or supranational entities, as applicable, all of which are investment-grade. | |
[2] | Issued by a diverse group of corporations, largely consisting of financial institutions, virtually all of which are investment-grade. | |
[3] | Includes loan-backed, receivable-backed, and mortgage-backed securities, all of which are investment-grade and in senior positions in the capital structure of the security. Loan-backed securities are collateralized by senior secured obligations of a diverse pool of companies or student loans, and receivable-backed securities are collateralized by credit cards receivables. Mortgage-backed securities are collateralized by diversified pools of residential and commercial mortgages. These securities are valued by third party models that use significant inputs derived from observable market data like prepayment rates, default rates, and recovery rates. |
Financial Instruments - Narrati
Financial Instruments - Narrative (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 03, 2016 | Dec. 31, 2015 | |
Short-term Debt [Line Items] | ||
Net liability position | $ 817 | |
Posted collateral, amount | 897 | |
Additional collateral | 13 | |
Commercial Paper [Member] | ||
Short-term Debt [Line Items] | ||
Commercial paper | 6,500 | $ 4,900 |
Derivative [Member] | ||
Short-term Debt [Line Items] | ||
Maximum exposure, amount | 2,200 | |
Cash and Cash Equivalents [Member] | ||
Short-term Debt [Line Items] | ||
Collateral received | $ 900 |
Financial Instruments - Derivat
Financial Instruments - Derivative Financial Instruments and Hedging Activities (Detail) $ in Millions, £ in Billions | 3 Months Ended | |||||
Apr. 03, 2016USD ($) | Mar. 29, 2015USD ($) | Apr. 03, 2016GBP (£) | Apr. 03, 2016USD ($) | Dec. 31, 2015USD ($) | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Long-term debt | [1] | $ 27,824 | $ 28,740 | |||
Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | $ (311) | $ (68) | |||
Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | (25) | (38) | |||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | 339 | (234) | |||
Interest Rate Contract [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative asset, notional amount | 20,100 | |||||
Foreign Currency Swap [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative asset, notional amount | $ 36,900 | |||||
Foreign Currency Swap [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | 55 | (732) | |||
Foreign Currency Swap [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | 0 | 0 | |||
Foreign Currency Swap [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | 118 | (607) | |||
Foreign Currency Swap [Member] | Not Designated as Hedging Instrument [Member] | Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | 0 | 0 | |||
Foreign Currency Swap [Member] | Not Designated as Hedging Instrument [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | (23) | 1 | |||
Foreign Currency Swap [Member] | Not Designated as Hedging Instrument [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | 0 | 0 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | (328) | 417 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | 1 | 0 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | 221 | 373 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | (12) | 249 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | (2) | 2 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | 0 | 0 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | 0 | 0 | |||
Foreign Currency Forward-Exchange Contracts [Member] | Not Designated as Hedging Instrument [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | (1) | (41) | |||
Foreign Currency Forward-Exchange Contracts [Member] | Not Designated as Hedging Instrument [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | 0 | 0 | |||
Foreign Currency Short Term Borrowings [Member] | Net Investment Hedging, Nonderivative Instruments [Member] | Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | (26) | 0 | |||
Foreign Currency Short Term Borrowings [Member] | Net Investment Hedging, Nonderivative Instruments [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | 0 | 0 | |||
Foreign Currency Short Term Borrowings [Member] | Net Investment Hedging, Nonderivative Instruments [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | 0 | 0 | |||
Foreign Currency Long Term Debt [Member] | Net Investment Hedging, Nonderivative Instruments [Member] | Other Comprehensive Income (Loss) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OCI (Effective Portion) | [2],[3] | 0 | (3) | |||
Foreign Currency Long Term Debt [Member] | Net Investment Hedging, Nonderivative Instruments [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Recognized in OID | [3],[4],[5] | 0 | 0 | |||
Foreign Currency Long Term Debt [Member] | Net Investment Hedging, Nonderivative Instruments [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Other Nonoperating Income (Expense) [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Amount of Gains/(Losses) Reclassified from OCI into OID (Effective Portion) | [2],[3] | $ 0 | $ 0 | |||
Unsecured Debt [Member] | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Long-term debt | £ | £ 2.1 | |||||
[1] | Amounts may not add due to rounding. | |||||
[2] | For derivative financial instruments in cash flow hedge relationships, the effective portion is included in Other comprehensive loss––Unrealized holding losses on derivative financial instruments, net. For derivative financial instruments in net investment hedge relationships and for foreign currency debt designated as hedging instruments, the effective portion is included in Other comprehensive loss––Foreign currency translation adjustments, net. | |||||
[3] | OID = Other (income)/deductions—net, included in Other (income)/deductions—net in the condensed consolidated statements of income. OCI = Other comprehensive income/(loss), included in the condensed consolidated statements of comprehensive income. | |||||
[4] | Also, includes gains and losses attributable to derivative instruments designated and qualifying as fair value hedges, as well as the offsetting gains and losses attributable to the hedged items in such hedging relationships. | |||||
[5] | There was no significant ineffectiveness for any period presented. |
Inventories (Detail)
Inventories (Detail) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 | |
Inventory Disclosure [Abstract] | |||
Finished goods | $ 2,782 | $ 2,714 | |
Work-in-process | 3,957 | 3,932 | |
Raw materials and supplies | 840 | 867 | |
Inventories | [1] | 7,578 | 7,513 |
Noncurrent inventories not included above | [2] | $ 644 | $ 594 |
[1] | Amounts may not add due to rounding. | ||
[2] | Included in Other noncurrent assets. There are no recoverability issues associated with these amounts. |
Identifiable Intangible Asset54
Identifiable Intangible Assets and Goodwill - Finite-lived and Indefinite-lived Intangible Assets (Detail) - USD ($) $ in Millions | Apr. 03, 2016 | Dec. 31, 2015 | |
Indefinite-lived Intangible Assets [Line Items] | |||
Total indefinite-lived intangible assets | $ 8,072 | $ 8,192 | |
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived Intangible Assets, Gross Carrying Amount | 81,505 | 81,205 | |
Finite-lived Intangible Assets, Accumulated Amortization | [1] | (49,975) | (49,040) |
Finite-lived Intangible Assets, less Accumulated Amortization | 31,530 | 32,165 | |
Intangible assets, gross carrying amount | [1] | 89,577 | 89,396 |
Identifiable Intangible Assets, less Accumulated Amortization | [1],[2] | 39,602 | 40,356 |
Brands [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Total indefinite-lived intangible assets | 6,893 | 7,021 | |
In Process Research and Development [Member] | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Total indefinite-lived intangible assets | 1,179 | 1,171 | |
Developed Technology Rights [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived Intangible Assets, Gross Carrying Amount | 77,630 | 77,613 | |
Finite-lived Intangible Assets, Accumulated Amortization | (48,088) | (47,193) | |
Finite-lived Intangible Assets, less Accumulated Amortization | 29,543 | 30,419 | |
Brands [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived Intangible Assets, Gross Carrying Amount | 2,103 | 1,973 | |
Finite-lived Intangible Assets, Accumulated Amortization | (956) | (928) | |
Finite-lived Intangible Assets, less Accumulated Amortization | 1,147 | 1,044 | |
License Agreements and Other [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived Intangible Assets, Gross Carrying Amount | 1,772 | 1,619 | |
Finite-lived Intangible Assets, Accumulated Amortization | (931) | (918) | |
Finite-lived Intangible Assets, less Accumulated Amortization | $ 841 | $ 701 | |
[1] | The decrease in Identifiable intangible assets, less accumulated amortization, is primarily related to amortization, partially offset by assets acquired, the impact of measurement period adjustments related to our acquisition of Hospira (see Note 2A) and the impact of foreign exchange. | ||
[2] | Amounts may not add due to rounding. |
Identifiable Intangible Asset55
Identifiable Intangible Assets and Goodwill - Finite-lived Intangible Assets Percentage of Total Intangibles (Details) | Apr. 03, 2016 |
Operating Segments [Member] | Developed Technology Rights [Member] | Global Innovative Pharmaceutical [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 21.00% |
Operating Segments [Member] | Developed Technology Rights [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 29.00% |
Operating Segments [Member] | Developed Technology Rights [Member] | Global Established Pharmaceutical [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 50.00% |
Operating Segments [Member] | Brands [Member] | Global Innovative Pharmaceutical [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 0.00% |
Operating Segments [Member] | Brands [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 73.00% |
Operating Segments [Member] | Brands [Member] | Global Established Pharmaceutical [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 27.00% |
Research and Development Expense [Member] | Developed Technology Rights [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 0.00% |
Research and Development Expense [Member] | Brands [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 0.00% |
Identifiable Intangible Asset56
Identifiable Intangible Assets and Goodwill - Indefinite-lived Intangible Assets Percentage of Total Intangibles (Details) | Apr. 03, 2016 |
Research and Development Expense [Member] | Brands [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 0.00% |
Research and Development Expense [Member] | In Process Research and Development [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 3.00% |
Operating Segments [Member] | Brands [Member] | Global Innovative Pharmaceutical [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 0.00% |
Operating Segments [Member] | Brands [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 71.00% |
Operating Segments [Member] | Brands [Member] | Global Established Pharmaceutical [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 29.00% |
Operating Segments [Member] | In Process Research and Development [Member] | Global Innovative Pharmaceutical [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 2.00% |
Operating Segments [Member] | In Process Research and Development [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 10.00% |
Operating Segments [Member] | In Process Research and Development [Member] | Global Established Pharmaceutical [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Percentage of total identifiable intangible assets, less accumulated amortization | 85.00% |
Identifiable Intangible Asset57
Identifiable Intangible Assets and Goodwill - Narrative (Detail) - USD ($) $ in Billions | 3 Months Ended | |
Apr. 03, 2016 | Mar. 29, 2015 | |
Finite-Lived Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization expense for finite-lived intangible assets | $ 1 | $ 1 |
Identifiable Intangible Asset58
Identifiable Intangible Assets and Goodwill - Goodwill (Detail) $ in Millions | 3 Months Ended | |
Apr. 03, 2016USD ($) | ||
Goodwill [Roll Forward] | ||
Balance, December 31, 2014 | $ 48,242 | [1] |
Balance, April 3, 2016 | 48,558 | [1] |
Operating Segments [Member] | ||
Goodwill [Roll Forward] | ||
Balance, December 31, 2014 | 48,242 | |
Additions | 78 | |
Other | 238 | [2] |
Balance, April 3, 2016 | 48,558 | |
Global Innovative Pharmaceutical [Member] | Operating Segments [Member] | ||
Goodwill [Roll Forward] | ||
Balance, December 31, 2014 | 12,689 | |
Additions | 0 | |
Other | 76 | [2] |
Balance, April 3, 2016 | 12,765 | |
Global Vaccines, Oncology and Consumer Healthcare [Member] | Operating Segments [Member] | ||
Goodwill [Roll Forward] | ||
Balance, December 31, 2014 | 11,120 | |
Additions | 51 | |
Other | 60 | [2] |
Balance, April 3, 2016 | 11,231 | |
Global Established Pharmaceutical [Member] | Operating Segments [Member] | ||
Goodwill [Roll Forward] | ||
Balance, December 31, 2014 | 24,433 | |
Additions | 26 | |
Other | 102 | [2] |
Balance, April 3, 2016 | $ 24,562 | |
[1] | Amounts may not add due to rounding. | |
[2] | Primarily reflects the impact of foreign exchange. |
Pension and Postretirement Be59
Pension and Postretirement Benefit Plans - Net Periodic Benefit Cost (Detail) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jan. 31, 2016 | Apr. 03, 2016 | Mar. 29, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |||
U.S. Qualified [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Service cost | [1],[2] | $ 63 | $ 72 | ||||
Interest cost | [1],[2] | 134 | 169 | ||||
Expected return on plan assets | [2] | (241) | (272) | ||||
Actuarial losses | [2] | 99 | 83 | ||||
Prior service credits | [2] | 1 | (2) | ||||
Curtailments | [2] | 2 | 2 | ||||
Settlements | [2] | 15 | 26 | ||||
Defined benefit plan, net periodic benefit cost | [2] | 73 | 78 | ||||
Plan settlements | $ 1,100 | ||||||
Voluntary contribution | $ 1,000 | 1,000 | [3] | ||||
U.S. Supplemental (Non-Qualified) [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Service cost | [1],[4] | 5 | 6 | ||||
Interest cost | [1],[4] | 12 | 14 | ||||
Expected return on plan assets | [4] | 0 | 0 | ||||
Actuarial losses | [4] | 9 | 12 | ||||
Prior service credits | [4] | 0 | 0 | ||||
Curtailments | [4] | 0 | 0 | ||||
Settlements | [4] | 10 | 15 | ||||
Defined benefit plan, net periodic benefit cost | [4] | 35 | 45 | ||||
Voluntary contribution | [3] | 70 | |||||
International [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Service cost | [1],[5] | 42 | 48 | ||||
Interest cost | [1],[5] | 60 | 79 | ||||
Expected return on plan assets | [5] | (98) | (106) | ||||
Actuarial losses | [5] | 23 | 32 | ||||
Prior service credits | [5] | 0 | (2) | ||||
Curtailments | [5] | 0 | 0 | ||||
Settlements | [5] | 1 | 0 | ||||
Defined benefit plan, net periodic benefit cost | [5] | 27 | 51 | ||||
Voluntary contribution | [3] | 50 | |||||
Postretirement Plans [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Service cost | [1],[6] | 10 | 14 | ||||
Interest cost | [1],[6] | 22 | 32 | ||||
Expected return on plan assets | [6] | (8) | (13) | ||||
Actuarial losses | [6] | 7 | 9 | ||||
Prior service credits | [6] | (41) | (31) | ||||
Curtailments | [6] | (6) | (10) | ||||
Settlements | [6] | 0 | 0 | ||||
Defined benefit plan, net periodic benefit cost | [6] | (16) | $ 1 | ||||
Voluntary contribution | [3] | $ (148) | |||||
Change in Accounting Estimate [Member] | Forecast [Member] | |||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||
Reduction of net periodic benefit cost | $ 191 | ||||||
[1] | Effective January 1, 2016, the Company changed the approach used to measure service and interest costs for U.S. and certain international pension and other postretirement benefits. For fiscal 2015, the Company measured service and interest costs utilizing a single weighted-average discount rate derived from the bond model or yield curve used to measure the respective plan obligations. For fiscal 2016, we elected to measure service and interest costs by applying the spot rates along the yield curve, or a yield curve implied from the bond model, to the plans' liability cash flows. The Company believes the new approach provides a more precise measurement of service and interest costs by aligning the timing of the plans’ liability cash flows to the corresponding spot rates on the yield curve. This change does not affect the measurement of our plan obligations. We have accounted for this change as a change in accounting estimate and, accordingly, have accounted for it on a prospective basis. The expected reduction in expense for 2016 associated with this change in estimate is $191 million, which is expected to be recognized evenly over each quarter of the year. | ||||||
[2] | The decrease in net periodic benefit costs for the three months ended April 3, 2016, compared to the three months ended March 29, 2015, for our U.S. qualified pension plans was primarily driven by (i) lower service and interest costs, resulting from a change in methodology for measuring service and interest costs (see (e) below) and (ii) lower settlement activity. The aforementioned decreases were partially offset by (i) a lower expected return on plan assets resulting from a net decrease of approximately $1.1 billion in the asset base due in part to lump-sum payments made in 2015 to certain terminated colleagues to settle Pfizer’s pension obligation, partially offset by a voluntary contribution of $1.0 billion made at the beginning of January 2016 and (ii) an increase in the amounts amortized for actuarial losses. | ||||||
[3] | Contributions to the postretirement plans reflect Internal Revenue Code 401(h) reimbursements totaling $198 million received for eligible 2014 and 2015 prescription drug expenses for certain retirees. | ||||||
[4] | The decrease in net periodic benefit costs for the three months ended April 3, 2016, compared to the three months ended March 29, 2015, for our U.S. non-qualified pension plans was primarily driven by (i) lower settlement activity and (ii) a decrease in the amounts amortized for actuarial losses resulting from the increase, in 2015, in the discount rate used to determine the benefit obligation. | ||||||
[5] | The decrease in net periodic benefit costs for the three months ended April 3, 2016, compared to the three months ended March 29, 2015, for our international pension plans was primarily driven by (i) lower service and interest costs, resulting from foreign exchange rate changes and a change in methodology for measuring service and interest costs (see (e) below), and (ii) a decrease in the amounts amortized for actuarial losses resulting from large gains in 2015, which decreased the plan net loss position, partially offset by (i) a decrease in the expected return on plan assets due to a lower expected rate of return on plan assets, and foreign exchange rates changes. | ||||||
[6] | The decrease in net periodic benefit costs for the three months ended April 3, 2016, compared to the three months ended March 29, 2015, for our postretirement plans was primarily driven by (i) lower service and interest costs, resulting from a change in methodology for measuring service and interest costs (see (e) below) and (ii) an increase in prior service credits due to the postretirement medical plan cap changes during 2015. The aforementioned changes were partially offset by (i) a decrease in expected return on plan assets, primarily resulting from a decrease in plan assets reflecting Internal Revenue Code 401(h) reimbursements to Pfizer for eligible 2014 and 2015 prescription drug expenses for certain retirees, and (ii) lower curtailment gains. |
Pension and Postretirement Be60
Pension and Postretirement Benefit Plans (Detail) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2016 | Apr. 03, 2016 | |||
Defined Benefit Plan Disclosure [Line Items] | ||||
Prescription expense reimbursements received | $ 198 | |||
U.S. Qualified [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Contributions from our general assets for the three months ended April 3, 2016 | $ 1,000 | 1,000 | [1] | |
Expected contributions from our general assets during 2016 | [2] | 1,000 | ||
U.S. Supplemental (Non-Qualified) [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Contributions from our general assets for the three months ended April 3, 2016 | [1] | 70 | ||
Expected contributions from our general assets during 2016 | [2] | 126 | ||
International [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Contributions from our general assets for the three months ended April 3, 2016 | [1] | 50 | ||
Expected contributions from our general assets during 2016 | [2] | 174 | ||
Postretirement Plans [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Contributions from our general assets for the three months ended April 3, 2016 | [1] | (148) | ||
Expected contributions from our general assets during 2016 | [2] | $ (6) | ||
[1] | Contributions to the postretirement plans reflect Internal Revenue Code 401(h) reimbursements totaling $198 million received for eligible 2014 and 2015 prescription drug expenses for certain retirees. | |||
[2] | Contributions expected to be made for 2016 are inclusive of amounts contributed during the three months ended April 3, 2016, including the $1.0 billion voluntary contribution that was made in January 2016 for the U.S. qualified plans, which was considered pre-funding for future anticipated mandatory contributions and is also expected to reduce Pension Benefit Guaranty Corporation variable rate premiums. The U.S. supplemental (non-qualified) pension plan, international pension plan and the postretirement plan contributions from our general assets include direct employer benefit payments. |
Earnings Per Common Share Att61
Earnings Per Common Share Attributable to Common Shareholders (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
EPS Numerator––Basic | |||
Income from continuing operations | [1] | $ 3,026 | $ 2,376 |
Less: Net income attributable to noncontrolling interests | 9 | 6 | |
Income from continuing operations attributable to Pfizer Inc. | 3,016 | 2,371 | |
Less: Preferred stock dividends––net of tax | 0 | 0 | |
Income from continuing operations attributable to Pfizer Inc. common shareholders | 3,016 | 2,370 | |
Discontinued operations––net of tax | [1] | 0 | 5 |
Less: Discontinued operations––net of tax, attributable to noncontrolling interests | 0 | 0 | |
Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders | 0 | 5 | |
Net income attributable to Pfizer Inc. common shareholders | 3,016 | 2,375 | |
Income from continuing operations attributable to Pfizer Inc. common shareholders and assumed conversions | 3,016 | 2,371 | |
Net income attributable to Pfizer Inc. common shareholders and assumed conversions | $ 3,016 | $ 2,376 | |
EPS Denominator | |||
Weighted-average number of common shares outstanding––Basic | [1] | 6,150 | 6,203 |
Common-share equivalents: stock options, stock issuable under employee compensation plans, convertible preferred stock and accelerated share repurchase agreement (shares) | 64 | 90 | |
Weighted-average number of common shares outstanding––Diluted | [1] | 6,214 | 6,292 |
Equity Option [Member] | |||
EPS Denominator | |||
Stock options that had exercise prices greater than the average market price of our common stock issuable under employee compensation plans (shares) | [2] | 86 | 34 |
[1] | Amounts may not add due to rounding. | ||
[2] | These common stock equivalents were outstanding for the three months ended April 3, 2016 and March 29, 2015, but were not included in the computation of diluted EPS for those periods because their inclusion would have had an anti-dilutive effect. |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ / shares in Units, shares in Millions | Mar. 10, 2016 | Apr. 03, 2016 | Mar. 08, 2016 |
Commitments and Contingencies Disclosure [Abstract] | |||
Share repurchase agreement, amount | $ 5,000,000,000 | ||
Accelerated share repurchases, cash paid | $ 5,000,000,000 | ||
Shares repurchased | 136 | ||
Shares repurchased, price per share (in dollars per share) | $ 29.36 | ||
Shares received in initial delivery, percentage of agreement amount | 80.00% | ||
Remaining authorized repurchase amount | $ 11,400,000,000 |
Commitments and Contingencies63
Commitments and Contingencies (Actions In Which We Are The Plaintiff) (Details) | 1 Months Ended | 2 Months Ended | 4 Months Ended | ||
Dec. 31, 2015Patents | Jun. 30, 2015Patents | Jun. 30, 2013Patents | Jul. 31, 2015Defendant | Dec. 31, 2015Patents | |
Tygacil [Member] | Pfizer Versus Mylan Laboratories Limited [Member] | Pending Litigation [Member] | |||||
Gain Contingencies [Line Items] | |||||
Number of patents | 2 | ||||
Precedex Premix [Member] | Hospira Versus Amneal Pharmaceuticals LLC [Member] | Pending Litigation [Member] | |||||
Gain Contingencies [Line Items] | |||||
Number of patents not infringed upon | 4 | ||||
Precedex Premix [Member] | Hospira Versus Fresenius [Member] | Pending Litigation [Member] | |||||
Gain Contingencies [Line Items] | |||||
Number of patents not infringed upon | 4 | ||||
Patent Infringement [Member] | Toviaz [Member] | Pfizer Versus Several Generic Manufacturers [Member] | Pending Litigation [Member] | |||||
Gain Contingencies [Line Items] | |||||
Number of patents | 5 | 8 | |||
Patent Infringement [Member] | Toviaz [Member] | Pfizer Versus Several Generic Manufacturers [Member] | Settled Litigation [Member] | |||||
Gain Contingencies [Line Items] | |||||
Number of patents | Defendant | 4 | ||||
Patent Infringement [Member] | Toviaz Composition-of-matter Patents [Member] | Pfizer Versus Several Generic Manufacturers [Member] | Pending Litigation [Member] | |||||
Gain Contingencies [Line Items] | |||||
Number of patents infringed upon | 3 |
Commitments and Contingencies64
Commitments and Contingencies (Actions In Which We Are The Defendant) (Detail) CAD in Millions | Jun. 30, 2014CAD | Mar. 31, 2013lagoon | Dec. 31, 2006Patents | Dec. 31, 2012CAD | Apr. 03, 2016ActionsClaim |
Patent Infringement [Member] | Effexor [Member] | Teva Canada Limited Versus Pfizer Canada Inc. [Member] | Pending Litigation [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of patents | Patents | 1 | ||||
Litigation settlement, expense | CAD 52.5 | ||||
Loss contingency, damages awarded, value | CAD 125 | ||||
Damages from Product Defects [Member] | Class Action Versus American Optical Corporation And Various Other Defendants [Member] | Pending Litigation [Member] | |||||
Loss Contingencies [Line Items] | |||||
Loss contingency, pending claims, number | Claim | 55,350 | ||||
Average Wholesale Price [Member] | State Governments Versus Pfizer, Pfizer Subsidiaries and Other Pharmaceutical Manufacturers [Member] | Pending Litigation [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of actions | Actions | 1 | ||||
Environmental Remediation Litigation [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of lagoons | lagoon | 2 |
Commitment and Contingencies (M
Commitment and Contingencies (Matters Resolved During Current Year) (Detail) $ in Millions | Feb. 12, 2016USD ($) | Oct. 31, 2014Patents | Jun. 30, 2010Patents | May. 31, 2010Patents | Dec. 31, 2009Actions |
Sutent [Member] | Patent Infringement [Member] | Pfizer Versus Mylan Pharmaceuticals Inc. [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of patents | 3 | 2 | |||
Number of patents infringed upon | 2 | ||||
Protonix / Pantoprazole [Member] | U.S. Department of Justice Versus Pfizer [Member] | Product Pricing [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of actions | Actions | 2 | ||||
Gain (loss) from contract settlement | $ | $ (784.6) |
Segment, Geographic and Other66
Segment, Geographic and Other Revenue Information - Narrative (Detail) $ in Millions | 3 Months Ended | |||
Apr. 03, 2016USD ($)businessOperating_SegmentOperating_segments | Mar. 29, 2015USD ($) | Dec. 31, 2015USD ($) | ||
Segment Reporting Information [Line Items] | ||||
Number of businesses | business | 2 | |||
Number of operating segments | Operating_segments | 3 | |||
Revenues | [1],[2] | $ 13,005 | $ 10,864 | |
Net income (loss) | [1] | 3,016 | 2,376 | |
Total assets | [3] | $ 162,929 | $ 167,381 | |
Innovative Products Business [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Number of operating segments | Operating_segments | 2 | |||
Revenues | [4] | $ 7,033 | 5,738 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | [4] | 3,394 | 2,664 | |
Established Products Business [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | [5] | 5,972 | 5,125 | |
Established Products Business [Member] | CentreOne [Member] | Global Established Pharmaceutical [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | [6] | $ 188 | 111 | |
Pfizer's Worldwide Research and Development [Member] | Global Established Pharmaceutical [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Costs and expenses | (66) | |||
Global Established Pharmaceutical Research and Development [Member] | Global Established Pharmaceutical [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Costs and expenses | 66 | |||
Innovative Products [Member] | Innovative Products Business [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Number of operating segments | Operating_Segment | 2 | |||
Adjustment [Member] | Established Products Business [Member] | CentreOne [Member] | Global Established Pharmaceutical [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 111 | |||
Net income (loss) | 21 | |||
Adjustment [Member] | Other Products [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (111) | |||
Net income (loss) | $ (21) | |||
[1] | Amounts may not add due to rounding. | |||
[2] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. | |||
[3] | Amounts may not add due to rounding. | |||
[4] | The Innovative Products business is composed of two operating segments: GIP and VOC. | |||
[5] | The Established Products business consists of GEP, which includes all legacy Hospira commercial operations. Hospira's commercial operations, including the legacy Hospira One-2-One sterile injectables contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statement of income commencing from the acquisition date of September 3, 2015. As a result, revenues for the first quarter of 2015 and GEP's revenues for the first quarter of 2015 do not include Hospira's revenues. Also, effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) legacy Hospira's One-2-One sterile injectables contract manufacturing operation. Prior to 2016, PCS was managed outside our operating segments and its revenues were reported as other business activities. We have reclassified prior period PCS revenues ($111 million in the first quarter of 2015) to conform to the current period presentation as part of GEP. | |||
[6] | Pfizer CentreOne includes (i) revenues from legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including revenues related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) revenues from legacy Hospira’s One-2-One sterile injectables contract manufacturing operation. For additional information, see (e) above. |
Segment, Geographic and Other67
Segment, Geographic and Other Revenue Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Segment Reporting Information [Line Items] | |||
Revenues | [1],[2] | $ 13,005 | $ 10,864 |
Earnings | [1],[3] | 3,561 | 3,082 |
Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 13,005 | 10,864 | |
Earnings | [3] | 7,684 | 6,190 |
Other Business Activities [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [4] | 0 | 0 |
Earnings | [3],[4] | (619) | (624) |
Corporate [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [4] | 0 | 0 |
Earnings | [3],[4] | (1,363) | (1,287) |
Purchase accounting adjustments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [4] | 0 | 0 |
Earnings | [3],[4] | (1,153) | (903) |
Acquisition-related costs [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [4] | 0 | 0 |
Earnings | [3],[4] | (116) | (23) |
Certain significant items [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [5] | 0 | 0 |
Earnings | [3],[5] | (638) | (228) |
Other unallocated [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 0 | 0 | |
Earnings | [3] | (234) | (45) |
Global Innovative Pharmaceutical [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 3,640 | 3,075 | |
Earnings | [3] | 2,192 | 1,511 |
Global Vaccines, Oncology and Consumer Healthcare [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 3,394 | 2,664 | |
Earnings | [3] | 1,835 | 1,464 |
Global Established Pharmaceutical [Member] | Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [6] | 5,972 | 5,125 |
Earnings | [3],[6] | $ 3,657 | $ 3,215 |
[1] | Amounts may not add due to rounding. | ||
[2] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. | ||
[3] | Income from continuing operations before provision for taxes on income. | ||
[4] | For a description, see the “Other Costs and Business Activities” section above. | ||
[5] | Certain significant items are substantive, unusual items that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis.For Earnings in the first quarter of 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $137 million, (ii) charges for certain legal matters of $286 million, (iii) certain asset impairment charges of $131 million, (iv) charges for business and legal entity alignment of $51 million and (v) other charges of $34 million. For additional information, see Note 3 and Note 4.For Earnings in the first quarter of 2015, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $104 million, (ii) charges for business and legal entity alignment of $101 million and (iii) other charges of $23 million. For additional information, see Note 3 and Note 4. | ||
[6] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira commercial operations, including the legacy Hospira One-2-One contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. Effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) the revenues and expenses of legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including the revenues and expenses related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) the revenues and expenses of legacy Hospira's One-2-One sterile injectables contract manufacturing operation, which has been included in GEP since we acquired Hospira on September 3, 2015. Prior to 2016, PCS was managed outside our operating segments as part of Pfizer Global Supply and reported as "Other Business Activities". We have reclassified prior period PCS operating results ($111 million of PCS revenues and $21 million of PCS earnings in the first quarter of 2015) to conform to the current period presentation as part of GEP. |
Segment, Geographic and Other68
Segment, Geographic and Other Revenue Information - Footnotes (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Segment Reporting Information [Line Items] | |||
Revenues | [1],[2] | $ 13,005 | $ 10,864 |
Net income (loss) | [1] | 3,016 | 2,376 |
Certain significant items [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [3] | 0 | 0 |
Cost reduction and productivity initiatives excluding acquisition related costs | 137 | 104 | |
Other legal matters, net | 286 | ||
Impairment of intangible assets | 131 | ||
Alignment Costs | 51 | 101 | |
Other nonoperating income (expense) | (34) | (23) | |
Established Products Business [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [4] | 5,972 | 5,125 |
Established Products Business [Member] | CentreOne [Member] | Global Established Pharmaceutical [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | [5] | $ 188 | 111 |
Adjustment [Member] | Established Products Business [Member] | CentreOne [Member] | Global Established Pharmaceutical [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 111 | ||
Net income (loss) | 21 | ||
Global Established Pharmaceutical Research and Development [Member] | Global Established Pharmaceutical [Member] | |||
Segment Reporting Information [Line Items] | |||
Costs and expenses | $ 66 | ||
[1] | Amounts may not add due to rounding. | ||
[2] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. | ||
[3] | Certain significant items are substantive, unusual items that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis.For Earnings in the first quarter of 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $137 million, (ii) charges for certain legal matters of $286 million, (iii) certain asset impairment charges of $131 million, (iv) charges for business and legal entity alignment of $51 million and (v) other charges of $34 million. For additional information, see Note 3 and Note 4.For Earnings in the first quarter of 2015, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $104 million, (ii) charges for business and legal entity alignment of $101 million and (iii) other charges of $23 million. For additional information, see Note 3 and Note 4. | ||
[4] | The Established Products business consists of GEP, which includes all legacy Hospira commercial operations. Hospira's commercial operations, including the legacy Hospira One-2-One sterile injectables contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statement of income commencing from the acquisition date of September 3, 2015. As a result, revenues for the first quarter of 2015 and GEP's revenues for the first quarter of 2015 do not include Hospira's revenues. Also, effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) legacy Hospira's One-2-One sterile injectables contract manufacturing operation. Prior to 2016, PCS was managed outside our operating segments and its revenues were reported as other business activities. We have reclassified prior period PCS revenues ($111 million in the first quarter of 2015) to conform to the current period presentation as part of GEP. | ||
[5] | Pfizer CentreOne includes (i) revenues from legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including revenues related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) revenues from legacy Hospira’s One-2-One sterile injectables contract manufacturing operation. For additional information, see (e) above. |
Segment, Geographic and Other69
Segment, Geographic and Other Revenue Information - Revenues By Geographic Area (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | [1],[2] | $ 13,005 | $ 10,864 |
United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | [2] | 6,625 | 4,433 |
Developed Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | [2],[3] | 2,370 | 2,312 |
Developed Rest Of World [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | [2],[4] | 1,520 | 1,493 |
Emerging Markets [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | [2],[5] | $ 2,489 | $ 2,626 |
[1] | Amounts may not add due to rounding. | ||
[2] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. | ||
[3] | Developed Europe region includes the following markets: Western Europe, Finland and the Scandinavian countries. Revenues denominated in euros were $1.8 billion in the first quarter of 2016 and $1.8 billion in the first quarter of 2015. | ||
[4] | Developed Rest of World region includes the following markets: Australia, Canada, Japan, New Zealand and South Korea. | ||
[5] | Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Africa, Eastern Europe, Central Europe, the Middle East and Turkey. |
Segment, Geographic and Other70
Segment, Geographic and Other Revenue Information - Revenues By Geographic Area - Footnotes (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016 | Mar. 29, 2015 | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | [1],[2] | $ 13,005 | $ 10,864 |
Developed Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | [2],[3] | 2,370 | 2,312 |
Euro Member Countries, Euro | Developed Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenues | $ 1,800 | $ 1,800 | |
[1] | Amounts may not add due to rounding. | ||
[2] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. | ||
[3] | Developed Europe region includes the following markets: Western Europe, Finland and the Scandinavian countries. Revenues denominated in euros were $1.8 billion in the first quarter of 2016 and $1.8 billion in the first quarter of 2015. |
Segment, Geographic and Other71
Segment, Geographic and Other Revenue Information - Revenues By Products (Detail) $ in Millions | 3 Months Ended | ||
Apr. 03, 2016USD ($)Operating_SegmentOperating_segments | Mar. 29, 2015USD ($) | ||
Revenue from External Customer [Line Items] | |||
Revenues | [1],[2] | $ 13,005 | $ 10,864 |
Number of operating segments | Operating_segments | 3 | ||
Global Innovative and Established Pharmaceutical [Member] | Lyrica [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [3] | $ 1,229 | 1,187 |
Global Innovative and Established Pharmaceutical [Member] | Viagra [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [4] | 396 | 396 |
Global Innovative and Established Pharmaceutical [Member] | Alliance revenues [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 360 | 222 | |
Innovative Products Business [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [5] | $ 7,033 | 5,738 |
Number of operating segments | Operating_segments | 2 | ||
Innovative Products Business [Member] | Innovative Products [Member] | |||
Revenue from External Customer [Line Items] | |||
Number of operating segments | Operating_Segment | 2 | ||
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [5] | $ 3,640 | 3,075 |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Lyrica [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [3] | 1,011 | 846 |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Enbrel (Outside the U.S. and Canada) [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 733 | 759 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Viagra [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [4] | 300 | 288 |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Chantix / Champix [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 220 | 158 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Xeljanz [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 197 | 96 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | BeneFIX [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 185 | 173 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | ReFacto AF/ Xyntha [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 129 | 120 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Genotropin [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 125 | 138 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Toviaz [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 64 | 63 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Somavert [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 55 | 49 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | B M P 2 [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 51 | 38 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Rapamune [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 45 | 53 | |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | Alliance revenues [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [6],[7] | 354 | 200 |
Innovative Products Business [Member] | Global Innovative Pharmaceutical [Member] | All Other Biopharmaceutical Products [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 171 | 92 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [5] | 3,394 | 2,664 |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | All Other Biopharmaceutical Products [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 117 | 63 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | Prevenar family [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 1,509 | 1,306 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | Ibrance [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 429 | 38 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | Sutent [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 278 | 242 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | Xalkori [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 139 | 111 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | Inlyta [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 101 | 95 | |
Innovative Products Business [Member] | Global Vaccines, Oncology and Consumer Healthcare [Member] | Consumer Healthcare [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 822 | 808 | |
Established Products Business [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [8] | 5,972 | 5,125 |
Legacy Established Products [Member] | Established Products Business [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [9] | 2,800 | 2,848 |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Lipitor [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 411 | 441 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Premarin family [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 256 | 232 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Norvasc [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 236 | 252 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Epi Pen [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 97 | 76 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Xalatan Xalacom [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 89 | 102 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Zithromax / Zmax [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 80 | 79 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Zoloft [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 79 | 86 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Relpax [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 78 | 80 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Effexor [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 70 | 73 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Tikosyn [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 61 | 37 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Xanax/Xanax XR [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 52 | 54 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Cardura [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 45 | 52 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Neurontin [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 44 | 55 | |
Legacy Established Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Other Legacy Established Products [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [7],[9] | 1,201 | 1,229 |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [10] | 1,090 | 1,437 |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Lyrica [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [3] | 218 | 341 |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Viagra [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [4] | 96 | 108 |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Pristiq [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 178 | 161 | |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Celebrex [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 172 | 205 | |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Vfend [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 156 | 182 | |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Zyvox [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 127 | 271 | |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Revatio [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 66 | 63 | |
Peri-LOE Products [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | All Other Peri-LOE Products [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 76 | 107 | |
Sterile Injectable Pharmaceuticals [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [11] | 1,524 | 729 |
Sterile Injectable Pharmaceuticals [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Medrol [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 113 | 87 | |
Sterile Injectable Pharmaceuticals [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Sulperazon [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 96 | 98 | |
Sterile Injectable Pharmaceuticals [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Fragmin [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 78 | 74 | |
Sterile Injectable Pharmaceuticals [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | Tygacil [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 76 | 74 | |
Sterile Injectable Pharmaceuticals [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | All Other Sterile Injectable Pharmaceuticals [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | 1,161 | 396 | |
Infusion Systems [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [12] | 304 | 0 |
Biosimilars [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [13] | 66 | 0 |
CentreOne [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | [14] | $ 188 | 111 |
Adjustment [Member] | CentreOne [Member] | Established Products Business [Member] | Global Established Pharmaceutical [Member] | |||
Revenue from External Customer [Line Items] | |||
Revenues | $ 111 | ||
[1] | Amounts may not add due to rounding. | ||
[2] | On September 3, 2015, we acquired Hospira. Commencing from the acquisition date, our condensed consolidated statement of income includes the operating results of Hospira. As a result, legacy Hospira operations are included in our condensed consolidated statements of income for the first quarter of 2016, but not for the first quarter of 2015. See Note 2A for additional information. | ||
[3] | Lyrica revenues from all of Europe, Russia, Turkey, Israel and Central Asia countries are included in Lyrica-GEP. All other Lyrica revenues are included in Lyrica-GIP. Total Lyrica revenues represent the aggregate of worldwide revenues from Lyrica-GIP and Lyrica-GEP. | ||
[4] | Viagra revenues from the U.S. and Canada are included in Viagra-GIP. All other Viagra revenues are included in Viagra-GEP. Total Viagra revenues represent the aggregate of worldwide revenues from Viagra-GIP and Viagra-GEP. | ||
[5] | The Innovative Products business is composed of two operating segments: GIP and VOC. | ||
[6] | Includes Eliquis and Rebif. | ||
[7] | Total Alliance revenues represent the aggregate of worldwide revenues from Alliance revenues GIP and Alliance revenues GEP, which is included in All other Legacy Established Products. | ||
[8] | The Established Products business consists of GEP, which includes all legacy Hospira commercial operations. Hospira's commercial operations, including the legacy Hospira One-2-One sterile injectables contract manufacturing business, are included in GEP’s operating results in our condensed consolidated statement of income commencing from the acquisition date of September 3, 2015. As a result, revenues for the first quarter of 2015 and GEP's revenues for the first quarter of 2015 do not include Hospira's revenues. Also, effective as of the beginning of 2016, our entire contract manufacturing business, Pfizer CentreOne, is now part of GEP. Pfizer CentreOne consists of (i) legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) legacy Hospira's One-2-One sterile injectables contract manufacturing operation. Prior to 2016, PCS was managed outside our operating segments and its revenues were reported as other business activities. We have reclassified prior period PCS revenues ($111 million in the first quarter of 2015) to conform to the current period presentation as part of GEP. | ||
[9] | Legacy Established Products include products that have lost patent protection (excluding Sterile Injectable Pharmaceuticals and Peri-LOE Products). | ||
[10] | Peri-LOE Products include products that have recently lost or are anticipated to soon lose patent protection. These products primarily include Celebrex and Zyvox in most developed markets, Lyrica in certain developed Europe markets, Pristiq globally and Inspra in the EU. | ||
[11] | Sterile Injectable Pharmaceuticals include generic injectables and proprietary specialty injectables (excluding Peri-LOE Products). | ||
[12] | Infusion Systems include Medication Management Systems products composed of infusion pumps and related software and services, as well as I.V. Infusion Products, including large volume I.V. solutions and their associated administration sets. | ||
[13] | Biosimilars include Inflectra (biosimilar infliximab) in certain European markets, Nivestim (biosimilar filgrastim) in certain Asian markets and Retacrit (biosimilar epoetin zeta) in certain international markets. | ||
[14] | Pfizer CentreOne includes (i) revenues from legacy Pfizer's contract manufacturing and active pharmaceutical ingredient sales operation, including revenues related to our manufacturing and supply agreements with Zoetis Inc. (previously known as Pfizer CentreSource or PCS); and (ii) revenues from legacy Hospira’s One-2-One sterile injectables contract manufacturing operation. For additional information, see (e) above. |