Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 31, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'BOSTON SCIENTIFIC CORPORATION | ' |
Entity Central Index Key | '0000885725 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 1,335,221,407 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Net sales | $1,735 | $1,735 | $5,305 | $5,428 |
Cost of products sold | 510 | 558 | 1,618 | 1,767 |
Gross profit | 1,225 | 1,177 | 3,687 | 3,661 |
Operating expenses: | ' | ' | ' | ' |
Selling, general and administrative expenses | 658 | 589 | 1,950 | 1,895 |
Research and development expenses | 217 | 220 | 644 | 648 |
Royalty expense | 28 | 29 | 115 | 125 |
Amortization expense | 101 | 99 | 305 | 294 |
Goodwill impairment charges | 0 | 748 | 423 | 4,350 |
Intangible asset impairment charges | 0 | 13 | 53 | 142 |
Contingent consideration (benefit) expense | 23 | -20 | -18 | -9 |
Restructuring charges | 19 | 54 | 55 | 93 |
Litigation-related charges | 76 | 50 | 206 | 119 |
Gain on divestiture | 0 | -11 | -40 | -11 |
Operating expenses | 1,122 | 1,771 | 3,693 | 7,646 |
Operating income (loss) | 103 | -594 | -6 | -3,985 |
Other income (expense): | ' | ' | ' | ' |
Interest expense | -137 | -65 | -266 | -197 |
Other, net | -6 | -4 | -10 | 23 |
Income (loss) before income taxes | -40 | -663 | -282 | -4,159 |
Income tax expense (benefit) | -35 | 1 | -53 | -30 |
Net income (loss) | ($5) | ($664) | ($229) | ($4,129) |
Net income (loss) per common share — basic | $0 | ($0.48) | ($0.17) | ($2.91) |
Net income (loss) per common share — assuming dilution | $0 | ($0.48) | ($0.17) | ($2.91) |
Weighted-average shares outstanding | ' | ' | ' | ' |
Basic | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 |
Assuming dilution | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Net income (loss) | ($5) | ($664) | ($229) | ($4,129) |
Foreign currency translation adjustment | 10 | 2 | 8 | 9 |
Net change in unrealized gains and losses on derivative financial instruments, net of tax | -38 | -27 | 81 | 17 |
Total other comprehensive income (loss) | -28 | -25 | 89 | 26 |
Total comprehensive income (loss) | ($33) | ($689) | ($140) | ($4,103) |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $571 | $207 |
Trade accounts receivable, net | 1,238 | 1,217 |
Inventories | 895 | 884 |
Deferred income taxes | 536 | 433 |
Prepaid expenses and other current assets | 285 | 281 |
Total current assets | 3,525 | 3,022 |
Property, plant and equipment, net | 1,530 | 1,564 |
Goodwill | 5,553 | 5,973 |
Other intangible assets, net | 5,936 | 6,289 |
Other long-term assets | 373 | 306 |
TOTAL ASSETS | 16,917 | 17,154 |
Current liabilities: | ' | ' |
Current debt obligations | 3 | 4 |
Accounts payable | 238 | 232 |
Accrued expenses | 1,346 | 1,284 |
Other current liabilities | 315 | 252 |
Total current liabilities | 1,902 | 1,772 |
Long-term debt | 4,246 | 4,252 |
Deferred income taxes | 1,623 | 1,713 |
Other long-term liabilities | 2,583 | 2,547 |
Commitments and contingencies | ' | ' |
Stockholders’ equity | ' | ' |
Preferred stock, $.01 par value - authorized 50,000,000 shares, none issued and outstanding | ' | ' |
Common stock, $.01 par value - authorized 2,000,000,000 shares and issued 1,557,892,509 shares as of September 30, 2013 and 1,542,347,188 shares as of December 31, 2012 | 16 | 15 |
Treasury stock, at cost - 219,056,477 shares as of September 30, 2013 and 186,635,532 shares as of December 31, 2012 | -1,367 | -1,092 |
Additional paid-in capital | 16,536 | 16,429 |
Accumulated deficit | -8,678 | -8,449 |
Accumulated other comprehensive income (loss), net of tax | 56 | -33 |
Total stockholders’ equity | 6,563 | 6,870 |
LIABILITIES AND STOCKHOLDERS' EQUITY | $16,917 | $17,154 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Stockholders' equity | ' | ' |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued | 1,557,892,509 | 1,542,347,188 |
Common stock, shares outstanding | 1,338,836,032 | 1,355,711,656 |
Treasury shares | 219,056,477 | 186,635,532 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash provided by operating activities | $809 | $891 |
Investing activities: | ' | ' |
Purchases of property, plant and equipment | -161 | -164 |
Proceeds from sale of property, plant and equipment | 53 | 0 |
Purchases of privately held securities | -13 | 0 |
Purchase of notes receivable | -8 | 0 |
Payments for acquisitions of businesses, net of cash acquired | 0 | 134 |
Payments for investments in companies and acquisitions of certain technologies | -13 | -18 |
Proceeds from business divestitures, net of costs | 30 | 10 |
Cash used for investing activities | -112 | -306 |
Financing activities: | ' | ' |
Payments on long-term borrowings | -1,450 | -9 |
Proceeds from Issuance of Long-term Debt | 1,440 | 0 |
Repayments of Long-term Lines of Credit | 240 | 260 |
Proceeds from Long-term Lines of Credit | 240 | 251 |
Payment of contingent consideration | -107 | -4 |
Payments for acquisitions of treasury stock | -275 | -500 |
Proceeds from issuances of shares of common stock | 59 | 20 |
Cash used for financing activities | -333 | -502 |
Effect of foreign exchange rates on cash | 0 | 2 |
Net increase in cash and cash equivalents | 364 | 85 |
Cash and cash equivalents at beginning of period | 207 | 267 |
Cash and cash equivalents at end of period | 571 | 352 |
Non-cash operating activities: | ' | ' |
Stock-based compensation expense | $77 | $85 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2013 | |
Basis of Presentation [Abstract] | ' |
BASIS OF PRESENTATION | ' |
BASIS OF PRESENTATION | |
The accompanying unaudited condensed consolidated financial statements of Boston Scientific Corporation have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for fair presentation have been included. Operating results for the three and nine months ended September 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. For further information, refer to the consolidated financial statements and footnotes thereto included in Item 8 of our 2012 Annual Report filed on Form 10-K. | |
Effective as of January 1, 2013, we reorganized our business from geographic regions to fully operationalized global business units. Our reorganization changed our reporting structure and changed the composition of our reporting units. As a result, we have reclassified certain prior year amounts to conform to the current year’s presentation. See Note D - Goodwill and Other Intangible Assets and Note L – Segment Reporting for further details. | |
Subsequent Events | |
We evaluate events occurring after the date of our most recent accompanying unaudited condensed consolidated balance sheets for potential recognition or disclosure in our financial statements. We did not identify any material subsequent events requiring adjustment to our accompanying unaudited condensed consolidated financial statements (recognized subsequent events) for the three and nine month periods ended September 30, 2013. Those items requiring disclosure (unrecognized subsequent events) in the financial statements have been disclosed accordingly. Refer to Note J - Commitments and Contingencies and Note B - Acquisitions for more information. |
Acquisitions
Acquisitions | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Acquisitions [Abstract] | ' | ||||||||
ACQUISITIONS | ' | ||||||||
ACQUISITIONS | |||||||||
We did not close any material acquisitions during the first nine months of 2013. On November 1, 2013, we completed the acquisition of the electrophysiology business of C.R. Bard Inc., for $275 million in cash. We believe that this transaction brings a strong commercial team and complementary portfolio of ablation catheters, diagnostic tools, and electrophysiology recording systems, and will allow us to better serve the global Electrophysiology market through a more comprehensive portfolio offering and sales infrastructure. | |||||||||
2012 Acquisition | |||||||||
Cameron Health, Inc. | |||||||||
On June 8, 2012, we completed the acquisition of the remaining equity of Cameron Health, Inc. (Cameron). Cameron has developed the world's first and only commercially available subcutaneous implantable cardioverter defibrillator - the S-ICD® system. | |||||||||
Our unaudited condensed consolidated financial statements include the operating results for the acquired entity from its date of acquisition. We do not present pro forma financial information for this acquisition given the results are not material to our consolidated financial statements. Transaction costs associated with this acquisition were expensed as incurred and were not material for the three and nine months ended September 30, 2013 and 2012. | |||||||||
Purchase Price Allocation | |||||||||
The components of the Cameron purchase price as of the acquisition date were as follows (in millions): | |||||||||
Cash, net of cash acquired | $ | 134 | |||||||
Fair value of contingent consideration | 259 | ||||||||
Fair value of prior interests | 79 | ||||||||
Fair value of debt assumed | 9 | ||||||||
$ | 481 | ||||||||
Prior to the acquisition, we had an equity interest in Cameron and held $40 million of notes receivable. We re-measured our previously held investments to their estimated acquisition-date fair value of $79 million and recorded a gain of $39 million in other, net in the accompanying condensed consolidated statements of operations during the second quarter of 2012. We measured the fair values of the previously held investments based on the liquidation preferences and priority of the equity interests and debt, including accrued interest. In addition, we prepaid the assumed debt obligation of Cameron for approximately $9 million during the second quarter of 2012. | |||||||||
Total consideration includes an initial $150 million cash payment at closing of the transaction, a payment of $150 million upon FDA approval of the S-ICD® system and up to an additional $1.050 billion of potential payments upon achievement of specified revenue-based milestones through the third quarter of 2018, which represents the end of a six-year period following FDA approval. Due to our receipt of FDA approval of Cameron's S-ICD® system, we paid the related $150 million milestone payment to the former shareholders of Cameron during the fourth quarter of 2012. | |||||||||
The following summarizes the Cameron purchase price allocation (in millions): | |||||||||
Goodwill | $ | 314 | |||||||
Amortizable intangible assets | 42 | ||||||||
Indefinite-lived intangible assets | 48 | ||||||||
Other net assets | 1 | ||||||||
Deferred income taxes | 76 | ||||||||
$ | 481 | ||||||||
We allocated a portion of the Cameron purchase price to specific intangible asset categories as follows: | |||||||||
Amount Assigned (in millions) | Weighted Average Amortization Period (in years) | Risk-Adjusted Discount Rates used in Purchase Price Allocation | |||||||
Amortizable intangible assets: | |||||||||
Technology-related | 40 | 11 | 14 | % | |||||
Customer relationships | 2 | 5 | 14 | % | |||||
Indefinite-lived intangible assets: | |||||||||
Purchased research and development | 48 | 14 | % | ||||||
90 | |||||||||
The technology-related intangible assets consist of technical processes, intellectual property, and institutional understanding with respect to products and processes that we expect to leverage in future products or processes and carry forward from one product generation to the next. The technology-related intangible assets are being amortized on a straight-line basis over their assigned estimated useful lives. | |||||||||
Purchased research and development represents the estimated fair value of acquired in-process research and development projects which have not yet reached technological feasibility. These indefinite-lived intangible assets are tested for impairment on an annual basis, or more frequently if impairment indicators are present, in accordance with U.S. GAAP and our accounting policies described in our 2012 Annual Report filed on Form 10-K. Upon completion of the associated research and development efforts, we determine the useful life of the technology and begin amortizing the assets to reflect their use over their remaining lives. Upon receiving FDA approval for Cameron's S-ICD® system in September 2012, we reclassified approximately $47 million of in-process research and development (IPR&D) to technology-related amortizable intangible assets. The total estimated costs to complete the remaining IPR&D program associated with Cameron are immaterial. | |||||||||
We believe that the estimated intangible asset values represent the fair value at the date of acquisition and do not exceed the amount a third party would pay for the assets. We used the income approach, specifically the discounted cash flow method and excess earnings method, to derive the fair value of the amortizable intangible assets and purchased research and development. These fair value measurements are based on significant unobservable inputs, including management estimates and assumptions and, accordingly, are classified as Level 3 within the fair value hierarchy prescribed by ASC Topic 820, Fair Value Measurements and Disclosures. | |||||||||
We recorded the excess of the aggregate purchase price over the estimated fair values of the identifiable assets acquired as goodwill, which is non-deductible for tax purposes. Goodwill was established due primarily to revenue and cash flow projections associated with future technologies, as well as synergies expected to be gained from the integration of this business into our Cardiac Rhythm Management (CRM) business and was allocated to our former geographic reportable segments based on the relative expected benefit from the business combination. Effective as of January 1, 2013, we reorganized our business from geographic regions to fully operationalized global business units. Our reorganization changed our reporting structure and changed the composition of our reporting units for goodwill impairment testing purposes. Following the reorganization, based on information regularly reviewed by our chief operating decision maker, we have three new global reportable segments consisting of: Cardiovascular, Rhythm Management, and MedSurg. See Note D - Goodwill and Other Intangible Assets for further details. | |||||||||
Contingent Consideration | |||||||||
Certain of our acquisitions involve contingent consideration arrangements. Payment of additional consideration is generally contingent on the acquired company reaching certain performance milestones, including attaining specified revenue levels, achieving product development targets or obtaining regulatory approvals. In accordance with U.S. GAAP, we recognize a liability equal to the fair value of the contingent payments we expect to make as of the acquisition date. We remeasure this liability each reporting period and record changes in the fair value through a separate line item within our consolidated statements of operations. | |||||||||
We recorded a net expense related to the change in fair value of our contingent consideration liabilities of $23 million in the third quarter of 2013 and a net benefit of $18 million in the first nine months of 2013, and recorded $20 million and $9 million of a net benefit during the third quarter and first nine months of 2012, respectively. We paid $100 million and $115 million in the third quarter and first nine months of 2013, respectively, we did not make any payments in the third quarter of 2012 and made payments of $4 million during the first nine months of 2012. As of September 30, 2013, the maximum amount of future contingent consideration (undiscounted) that we could be required to pay is approximately $2.179 billion. | |||||||||
Changes in the fair value of our contingent consideration liability were as follows (in millions): | |||||||||
Balance as of December 31, 2012 | $ | (663 | ) | ||||||
Amounts recorded to acquisition purchase accounting | (6 | ) | |||||||
Net fair value adjustments | 18 | ||||||||
Payments made | 115 | ||||||||
Balance as of September 30, 2013 | $ | (536 | ) | ||||||
Contingent consideration liabilities are remeasured to fair value each reporting period using projected revenues, discount rates, probabilities of payment and projected payment dates. The recurring Level 3 fair value measurements of our contingent consideration liability include the following significant unobservable inputs: | |||||||||
Contingent Consideration Liability | Fair Value as of September 30, 2013 | Valuation Technique | Unobservable Input | Range | |||||
Research and Development, Regulatory and Commercialization-based Milestones | $126 million | Probability Weighted Discounted Cash Flow | Discount Rate | 0.8% - 1.1% | |||||
Probability of Payment | 70% - 98% | ||||||||
Projected Year of Payment | 2013 - 2014 | ||||||||
Revenue-based Payments | $144 million | Discounted Cash Flow | Discount Rate | 12% - 18% | |||||
Probability of Payment | 15% - 100% | ||||||||
Projected Year of Payment | 2013 - 2018 | ||||||||
$266 million | Monte Carlo | Revenue Volatility | 13% - 28% | ||||||
Risk Free Rate | LIBOR Term Structure | ||||||||
Projected Year of Payment | 2013 - 2018 | ||||||||
Increases or decreases in the fair value of our contingent consideration liability can result from changes in discount periods and rates, as well as changes in the timing and amount of revenue estimates or in the timing or likelihood of achieving regulatory-, revenue- or commercialization-based milestones. Projected contingent payment amounts related to research and development, regulatory- and commercialization-based milestones and certain revenue-based milestones are discounted back to the current period using a discounted cash flow (DCF) model. Other revenue-based payments are valued using a Monte Carlo valuation model, which simulates future revenues during the earn out-period using management's best estimates. Projected revenues are based on our most recent internal operational budgets and long-range strategic plans. Increases in projected revenues and probabilities of payment may result in higher fair value measurements. Increases in discount rates and the time to payment may result in lower fair value measurements. Increases or decreases in any of those inputs in isolation may result in a significantly lower or higher fair value measurement. |
Divestitures
Divestitures | 9 Months Ended |
Sep. 30, 2013 | |
Divestitures and Assets Held for Sale [Abstract] | ' |
DIVESTITURES | ' |
DIVESTITURES | |
In January 2011, we closed the sale of our Neurovascular business to Stryker Corporation for a purchase price of $1.500 billion, $1.450 billion of which we received at closing. We received an additional $10 million during 2012, $30 million during the second quarter of 2013, and we will receive the final $10 million of consideration contingent upon the FDA approval of the transfer of certain manufacturing facilities. | |
Due to our continuing involvement in the operations of the Neurovascular business, the divestiture does not meet the criteria for presentation as a discontinued operation. Revenue generated by the Neurovascular business was $2 million in the third quarter of 2013, $56 million in the first nine months of 2013, $32 million in the third quarter of 2012, and $91 million in the first nine months of 2012. |
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Goodwill and Other Intangible Assets [Abstract] | ' | ||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ' | ||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | |||||||||||||||||
The gross carrying amount of goodwill and other intangible assets and the related accumulated amortization for intangible assets subject to amortization and accumulated write-offs of goodwill as of September 30, 2013 and December 31, 2012 is as follows: | |||||||||||||||||
As of | |||||||||||||||||
September 30, 2013 | December 31, 2012 | ||||||||||||||||
Gross Carrying | Accumulated | Gross Carrying | Accumulated | ||||||||||||||
Amortization/ | Amortization/ | ||||||||||||||||
(in millions) | Amount | Write-offs | Amount | Write-offs | |||||||||||||
Amortizable intangible assets | |||||||||||||||||
Technology-related | $ | 8,118 | $ | (3,254 | ) | $ | 8,020 | $ | (3,005 | ) | |||||||
Patents | 504 | (322 | ) | 559 | (352 | ) | |||||||||||
Other intangible assets | 815 | (465 | ) | 810 | (428 | ) | |||||||||||
$ | 9,437 | $ | (4,041 | ) | $ | 9,389 | $ | (3,785 | ) | ||||||||
Unamortizable intangible assets | |||||||||||||||||
Goodwill | $ | 15,453 | $ | (9,900 | ) | $ | 15,450 | $ | (9,477 | ) | |||||||
Technology-related | 197 | — | 242 | — | |||||||||||||
$ | 15,650 | $ | (9,900 | ) | $ | 15,692 | $ | (9,477 | ) | ||||||||
During the third quarter of 2013, we reclassified approximately $45 million of core technology not previously subject to amortization to amortizable intangible assets due to projected changes in the market for this technology. We tested the intangible asset for impairment prior to this reclassification and determined that the asset was not impaired. In addition, we had $343 million and $443 million of purchased research and development intangible assets as of September 30, 2013 and December 31, 2012, respectively. | |||||||||||||||||
2013 Reorganization | |||||||||||||||||
We assess goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment, referred to as a component. Effective as of January 1, 2013, we reorganized our business from geographic regions to fully operationalized global business units. Our reorganization changed our reporting structure and changed the composition of our reporting units for goodwill impairment testing purposes. Following the reorganization, based on information regularly reviewed by our chief operating decision maker, we have three new global reportable segments consisting of: Cardiovascular, Rhythm Management, and MedSurg. We determined our new global reporting units by identifying our operating segments and assessing whether any components of these segments constituted a business for which discrete financial information is available and whether segment management regularly reviews the operating results of any components. Through this process, we identified the following new global reporting units effective as of January 1, 2013: Interventional Cardiology, Peripheral Interventions, Cardiac Rhythm Management (CRM), Electrophysiology, Endoscopy, Urology/Women's Health, and Neuromodulation. | |||||||||||||||||
To determine the amount of goodwill within our new global reporting units, on a relative fair value basis we reallocated $1.764 billion of goodwill previously allocated to our former Europe, Middle East and Africa (EMEA), Asia Pacific, Japan, and Americas international reporting units to our new global reporting units. In addition, we reallocated the goodwill previously allocated to the former U.S. divisional reporting units to each respective new global reporting unit, with the exception of the goodwill allocated to the former U.S. Cardiovascular reporting unit. The $2.380 billion of goodwill allocated to the former U.S. Cardiovascular reporting unit was reallocated between the new global Interventional Cardiology and global Peripheral Interventions reporting units on a relative fair value basis. | |||||||||||||||||
The following represents our goodwill balance by new global reportable segment. We restated the prior period information to conform to the current presentation: | |||||||||||||||||
(in millions) | Cardiovascular | Rhythm Management | MedSurg | Total | |||||||||||||
Balance as of December 31, 2012 (restated) | $ | 3,249 | $ | 577 | $ | 2,147 | $ | 5,973 | |||||||||
Purchase price adjustments | 3 | — | — | 3 | |||||||||||||
Goodwill acquired | — | — | — | — | |||||||||||||
Goodwill written off | — | (423 | ) | — | (423 | ) | |||||||||||
Balance as of September 30, 2013 | $ | 3,252 | $ | 154 | $ | 2,147 | $ | 5,553 | |||||||||
2013 Goodwill Impairment Testing and Charge | |||||||||||||||||
We test our goodwill balances during the second quarter of each year for impairment, or more frequently if indicators are present or changes in circumstances suggest that impairment may exist. Following our reorganization from regions to global business units and our reallocation of goodwill on a relative fair value basis, we conducted the first step of the goodwill impairment test for all new global reporting units as of January 1, 2013. The first step requires a comparison of the carrying value of the reporting units to the fair value of these units. The fair value of each new global reporting unit exceeded its carrying value, with the exception of the global CRM reporting unit. The global CRM reporting unit carrying value exceeded its fair value primarily due to the carrying value of its amortizable intangible assets. The carrying value of amortizable intangible assets allocated to the global CRM reporting unit was $4.636 billion as of January 1, 2013. In accordance with ASC Topic 350, Intangibles—Goodwill and Other (Topic 350), we tested the global CRM amortizable intangible assets for impairment in conjunction with the interim goodwill impairment test of our global CRM reporting unit. We performed the impairment analysis of the amortizable intangible assets on an undiscounted cash flow basis, and concluded that these assets were not impaired. | |||||||||||||||||
The second step of the goodwill impairment test compares the estimated fair value of a reporting unit’s goodwill to its carrying value. We performed the second step of the goodwill impairment test on the global CRM reporting unit and recorded a non-cash goodwill impairment charge of $423 million ($421 million after-tax) to write-down the goodwill to its implied fair value as of January 1, 2013. The primary driver of this impairment charge was our reorganization from geographic regions to global business units as of January 1, 2013, which changed the composition of our reporting units. As a result of the reorganization, any goodwill allocated to the global CRM reporting unit was no longer supported by the cash flows of other businesses. Under our former reporting unit structure, the goodwill allocated to our regional reporting units was supported by the cash flows from all businesses in each international region. The hypothetical tax structure of the global CRM business and the global CRM business discount rate applied were also contributing factors to the goodwill impairment charge. We finalized the second step of the global CRM goodwill impairment test during the second quarter of 2013, in accordance with ASC Topic 350, Intangibles - Goodwill and Other, and determined that no adjustments to the charge were required. After recording the impairment charge in the first quarter of 2013, there was no remaining goodwill allocated to the global CRM reporting unit as of March 31, 2013. | |||||||||||||||||
The goodwill impairment charge taken during the first quarter of 2013 was determined on a global CRM basis pursuant to our new organizational structure. We used the income approach, specifically the DCF method, to derive the fair value of the global CRM reporting unit. We completed a DCF model associated with our new global CRM business, including the amount and timing of future expected cash flows, tax attributes, the terminal value growth rate of approximately two percent and the appropriate market-participant risk-adjusted weighted average cost of capital (WACC) of approximately 12 percent. | |||||||||||||||||
In the second quarter of 2013, we performed our annual goodwill impairment test for all of our reporting units. In conjunction with our annual test, the fair value of each reporting unit exceeded its carrying value except CRM, for which no goodwill remains. Therefore, it was deemed not necessary to proceed to the second step of the impairment test. We have identified our global Neuromodulation reporting unit as being at higher risk of potential failure of the first step of the goodwill impairment test in future reporting periods. Our global Neuromodulation reporting unit holds $1.356 billion of allocated goodwill. The level of excess fair value over carrying value for this reporting unit identified during our annual goodwill impairment test was approximately 16 percent. Future changes in our reporting units or in the structure of our business as a result of future reorganizations, acquisitions or divestitures of assets or businesses could result in future impairments of goodwill within our reporting units including global CRM. Further, the recoverability of our CRM-related amortizable intangibles ($4.442 billion globally as of September 30, 2013) is sensitive to future cash flow assumptions and our global CRM business performance. The $4.442 billion of CRM-related amortizable intangibles are at higher risk of potential failure of the first step of the amortizable intangible recoverability test in future reporting periods. An impairment of a material portion of our CRM-related amortizable intangibles carrying value would occur if the second step of the amortizable intangible test is required in a future reporting period. Refer to Critical Accounting Policies and Estimates within our Management's Discussion and Analysis of Financial Condition and Results of Operations contained in Item 2 of this Quarterly Report on Form 10-Q for a discussion of key assumptions used in our testing. | |||||||||||||||||
On a quarterly basis, we monitor the key drivers of fair value to detect events or other changes that would warrant an interim impairment test of our goodwill and intangible assets. The key variables that drive the cash flows of our reporting units and amortizable intangibles are estimated revenue growth rates and levels of profitability. Terminal value growth rate assumptions, as well as the WACC rate applied are additional key variables for reporting unit cash flows. These assumptions are subject to uncertainty, including our ability to grow revenue and improve profitability levels. Relatively small declines in the future performance and cash flows of a reporting unit or asset group or small changes in other key assumptions may result in the recognition of significant asset impairment charges. For example, keeping all other variables constant, an increase in the WACC applied of 80 basis points or a 200 basis point decrease in the terminal value growth rate would require that we perform the second step of the goodwill impairment test for the global Neuromodulation reporting unit. The estimates used for our future cash flows and discount rates represent management's best estimates, which we believe to be reasonable, but future declines in business performance may impair the recoverability of our goodwill and intangible asset balances. | |||||||||||||||||
Future events that could have a negative impact on the levels of excess fair value over carrying value of our reporting units and/or amortizable intangible assets include, but are not limited to: | |||||||||||||||||
• | decreases in estimated market sizes or market growth rates due to greater-than-expected declines in procedural volumes, pricing pressures, reductions in reimbursement levels, product actions, and/or competitive technology developments; | ||||||||||||||||
• | declines in our market share and penetration assumptions due to increased competition, an inability to develop or launch new and next-generation products and technology features in line with our commercialization strategies, and market and/or regulatory conditions that may cause significant launch delays or product recalls; | ||||||||||||||||
• | decreases in our forecasted profitability due to an inability to successfully implement and achieve timely and sustainable cost improvement measures consistent with our expectations, increases in our market-participant tax rate, and/or changes in tax laws; | ||||||||||||||||
• | negative developments in intellectual property litigation that may impact our ability to market certain products or increase our costs to sell certain products; | ||||||||||||||||
• | the level of success of on-going and future research and development efforts, including those related to recent acquisitions, and increases in the research and development costs necessary to obtain regulatory approvals and launch new products; | ||||||||||||||||
• | the level of success in managing the growth of acquired companies, achieving sustained profitability consistent with our expectations, establishing government and third-party payer reimbursement, supplying the market, and increases in the costs and time necessary to integrate acquired businesses into our operations successfully; | ||||||||||||||||
• | changes in our reporting units or in the structure of our business as a result of future reorganizations, acquisitions or divestitures of assets or businesses; | ||||||||||||||||
• | increases in our market-participant risk-adjusted WACC; and | ||||||||||||||||
• | declines in revenue as a result of loss of key members of our sales force or other key personnel. | ||||||||||||||||
Negative changes in one or more of these factors, among others, could result in additional impairment charges. | |||||||||||||||||
2012 Charges | |||||||||||||||||
In the second quarter of 2012, we performed our annual goodwill impairment test for all of our reporting units and concluded that the goodwill within our former EMEA reporting unit was impaired and recorded a $3.602 billion ($3.579 billion after-tax) charge in the second quarter of 2012. As a result of revised estimates developed during our annual strategic planning process and analysis performed in conjunction with our annual goodwill impairment test, we concluded that the revenue growth rates projected for the EMEA reporting unit were slightly lower than our previous estimates primarily driven by macro-economic factors and our performance in the European market. We updated short-term operating projections based on our most recent strategic plan for EMEA prepared by management. We reduced the EMEA long-term growth rates and terminal value growth rate projections and increased the discount rate within our 15-year DCF model for EMEA by approximately 100 basis points due to increased risk associated with our projections in this market primarily as a result of economic uncertainty in Europe. In addition, our expectations for future growth and profitability were lowered as compared to our previous estimates and reflected declines in average selling prices and volume pressures due to austerity measures. The declines expected in the EMEA market did not impact our assumptions related to other reporting units. | |||||||||||||||||
In the third quarter of 2012, we performed an interim goodwill impairment test and recorded a non-cash $748 million (pre- and after-tax) charge associated with our former U.S. Cardiac Rhythm Management (U.S. CRM) reporting unit, primarily driven by a reduction in the estimated size of the U.S. CRM market, related adjustments to our business and other competitive factors, which led to lower projected U.S. CRM results compared to prior forecasts. The U.S. CRM market is dynamic, highly competitive and difficult to forecast; in the third quarter of 2012, we lowered our projections for the U.S. CRM market size and our future revenue levels within this market, primarily to reflect changes in expectations of average selling prices and unit growth, adjustments to our business and other competitive factors. The increased pricing pressure and lower unit volumes were primarily due to physician alignment with hospitals, efforts to reduce health care costs, focus on appropriate device usage, replacement volumes and competition, and were more impactful to the U.S. CRM business than previously estimated. In addition, we adjusted certain elements of our business and shifted investments to focus on areas expected to provide the highest future growth and financial return. As a result of these factors, we reduced the compound annual revenue growth rate of our 15 year DCF model for the U.S. CRM reporting unit by approximately 250 basis points. The declines expected in the U.S. CRM market did not impact our assumptions related to other reporting units. | |||||||||||||||||
The following is a rollforward of accumulated goodwill write-offs by global reportable segment. We restated the prior period information to conform to the current period presentation: | |||||||||||||||||
(in millions) | Cardiovascular | Rhythm Management | MedSurg | Total | |||||||||||||
Accumulated write-offs as of December 31, 2012 (restated) | $ | (1,479 | ) | $ | (6,537 | ) | $ | (1,461 | ) | $ | (9,477 | ) | |||||
Goodwill written off | — | (423 | ) | — | (423 | ) | |||||||||||
Accumulated write-offs as of September 30, 2013 | $ | (1,479 | ) | $ | (6,960 | ) | $ | (1,461 | ) | $ | (9,900 | ) | |||||
Intangible Asset Impairment Charges | |||||||||||||||||
On a quarterly basis, we monitor for events or other potential indicators of impairment that would warrant an interim impairment test of our intangible assets. See Goodwill Impairment Charges above for discussion of future events that could have a negative impact on the recoverability of our amortizable intangible assets. | |||||||||||||||||
2013 Charges | |||||||||||||||||
During the third quarter of 2013, we performed our annual impairment test of all in-process research and development projects, and our indefinite lived core technology assets, and recorded no impairments based on the results of our testing. These indefinite-lived intangible assets are tested for impairment on an annual basis, or more frequently if impairment indicators are present, in accordance with U.S. GAAP and our accounting policies described in our 2012 Annual Report filed on Form 10-K. | |||||||||||||||||
During the second quarter of 2013 as a result of revised estimates developed in conjunction with our annual strategic planning process and annual goodwill impairment test, we performed an interim impairment test of our in-process research and development projects associated with certain of our acquisitions. Based on the results of our impairment analyses, we revised our expectations of the market size related to Sadra Medical, Inc. (Sadra), and the resulting timing and amount of future revenue and cash flows associated with the technology acquired from Sadra. As a result of these changes, we recorded pre-tax impairment charges of $51 million to write-down the balance of these intangible assets to their fair value during the second quarter of 2013. During the second quarter of 2013, we also recorded an additional $2 million intangible asset impairment charge associated with changes in the amount of the expected cash flows related to certain other acquired in-process research and development projects. | |||||||||||||||||
In-process research and development fair value is measured using projected revenues, projected expenses, discount rates, and | |||||||||||||||||
probability of expected launch. The nonrecurring Level 3 fair value measurements of the impairment analysis performed in the second quarter of 2013 included the following significant unobservable inputs: | |||||||||||||||||
Intangible Asset | Valuation Date | Fair Value | Valuation Technique | Unobservable Input | Rate | ||||||||||||
In-Process R&D | 30-Jun-13 | $178 million | Income Approach - Excess Earnings Method | Discount Rate | 16.50% | ||||||||||||
2012 Charges | |||||||||||||||||
During the third quarter of 2012, we recorded a $13 million intangible asset impairment charge attributable to increased expectations in the cost to bring an in-process project to market in a certain geographic region and lower future revenue expectations associated with an in-process project. During the second quarter of 2012, we recorded a $129 million intangible asset impairment charge attributable to in-process research and development assets associated with Sadra due to revised expectations of the required effort, time and cost involved in completing the in-process projects and bringing the related products to market. | |||||||||||||||||
We recorded these amounts in the intangible assets impairment charges caption in our accompanying unaudited condensed consolidated statements of operations. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | |||||||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||||||
Fair Value Measurements [Abstract] | ' | |||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS | ||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities | ||||||||||||||||||||||||||||||||
We develop, manufacture and sell medical devices globally and our earnings and cash flows are exposed to market risk from changes in foreign currency exchange rates and interest rates. We address these risks through a risk management program that includes the use of derivative financial instruments, and operate the program pursuant to documented corporate risk management policies. We recognize all derivative financial instruments in our consolidated financial statements at fair value in accordance with ASC Topic 815, Derivatives and Hedging (Topic 815). In accordance with Topic 815, for those derivative instruments that are designated and qualify as hedging instruments, the hedging instrument must be designated, based upon the exposure being hedged, as a fair value hedge, cash flow hedge, or a hedge of a net investment in a foreign operation. The accounting for changes in the fair value (i.e. gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. Our derivative instruments do not subject our earnings or cash flows to material risk, as gains and losses on these derivatives generally offset losses and gains on the item being hedged. We do not enter into derivative transactions for speculative purposes and we do not have any non-derivative instruments that are designated as hedging instruments pursuant to Topic 815. | ||||||||||||||||||||||||||||||||
Currency Hedging | ||||||||||||||||||||||||||||||||
We are exposed to currency risk consisting primarily of foreign currency denominated monetary assets and liabilities, forecasted foreign currency denominated intercompany and third-party transactions and net investments in certain subsidiaries. We manage our exposure to changes in foreign currency exchange rates on a consolidated basis to take advantage of offsetting transactions. We use both derivative instruments (currency forward contracts), and non-derivative transactions (primarily European manufacturing and distribution operations) to reduce the risk that our earnings and cash flows associated with these foreign currency denominated balances and transactions will be adversely affected by foreign currency exchange rate changes. | ||||||||||||||||||||||||||||||||
Designated Foreign Currency Hedges | ||||||||||||||||||||||||||||||||
All of our designated currency hedge contracts outstanding as of September 30, 2013 and December 31, 2012 were cash flow hedges under Topic 815 intended to protect the U.S. dollar value of our forecasted foreign currency denominated transactions. We record the effective portion of any change in the fair value of foreign currency cash flow hedges in other comprehensive income (OCI) until the related third-party transaction occurs. Once the related third-party transaction occurs, we reclassify the effective portion of any related gain or loss on the foreign currency cash flow hedge to earnings. In the event the hedged forecasted transaction does not occur, or it becomes no longer probable that it will occur, we reclassify the amount of any gain or loss on the related cash flow hedge to earnings at that time. We had currency derivative instruments designated as cash flow hedges outstanding in the contract amount of $2.647 billion as of September 30, 2013 and $2.469 billion as of December 31, 2012. | ||||||||||||||||||||||||||||||||
We recognized net gains of $15 million in earnings on our cash flow hedges during the third quarter of 2013 and $15 million for the first nine months of 2013, as compared to net losses of $3 million during the third quarter of 2012 and $29 million for the first nine months of 2012. All currency cash flow hedges outstanding as of September 30, 2013 mature within 36 months. As of September 30, 2013, $113 million of net gains, net of tax, were recorded in accumulated other comprehensive income (AOCI) to recognize the effective portion of the fair value of any currency derivative instruments that are, or previously were, designated as foreign currency cash flow hedges, as compared to net gains of $31 million as of December 31, 2012. As of September 30, 2013, $58 million of net gains, net of tax, may be reclassified to earnings within the next twelve months. | ||||||||||||||||||||||||||||||||
The success of our hedging program depends, in part, on forecasts of transaction activity in various currencies (primarily Japanese yen, Euro, British pound sterling, Australian dollar and Canadian dollar). We may experience unanticipated currency exchange gains or losses to the extent that there are differences between forecasted and actual activity during periods of currency volatility. In addition, changes in foreign currency exchange rates related to any unhedged transactions may impact our earnings and cash flows. | ||||||||||||||||||||||||||||||||
Non-designated Foreign Currency Contracts | ||||||||||||||||||||||||||||||||
We use currency forward contracts as a part of our strategy to manage exposure related to foreign currency denominated monetary assets and liabilities. These currency forward contracts are not designated as cash flow, fair value or net investment hedges under Topic 815; are marked-to-market with changes in fair value recorded to earnings; and are entered into for periods consistent with currency transaction exposures, generally less than one year. We had currency derivative instruments not designated as hedges under Topic 815 outstanding in the contract amount of $1.757 billion as of September 30, 2013 and $1.942 billion as of December 31, 2012. | ||||||||||||||||||||||||||||||||
Interest Rate Hedging | ||||||||||||||||||||||||||||||||
Our interest rate risk relates primarily to U.S. dollar borrowings, partially offset by U.S. dollar cash investments. We have historically used interest rate derivative instruments to manage our earnings and cash flow exposure to changes in interest rates by converting floating-rate debt into fixed-rate debt or fixed-rate debt into floating-rate debt. | ||||||||||||||||||||||||||||||||
We designate these derivative instruments either as fair value or cash flow hedges under Topic 815. We record changes in the value of fair value hedges in interest expense, which is generally offset by changes in the fair value of the hedged debt obligation. Interest payments made or received related to our interest rate derivative instruments are included in interest expense. We record the effective portion of any change in the fair value of derivative instruments designated as cash flow hedges as unrealized gains or losses in OCI, net of tax, until the hedged cash flow occurs, at which point the effective portion of any gain or loss is reclassified to earnings. We record the ineffective portion of our cash flow hedges in interest expense. In the event the hedged cash flow does not occur, or it becomes no longer probable that it will occur, we reclassify the amount of any gain or loss on the related cash flow hedge to interest expense at that time. We had no interest rate derivative contracts outstanding as of September 30, 2013 or December 31, 2012. | ||||||||||||||||||||||||||||||||
In prior years, we terminated certain interest rate derivative contracts, including fixed-to-floating interest rate contracts, designated as fair value hedges, and floating-to-fixed treasury locks, designated as cash flow hedges. We are amortizing the gains and losses on these derivative instruments upon termination into earnings as a reduction of interest expense over the remaining term of the hedged debt, in accordance with Topic 815. The carrying amount of certain of our senior notes included unamortized gains of $56 million as of September 30, 2013 and $64 million as of December 31, 2012, and unamortized losses of $3 million as of September 30, 2013 and $3 million as of December 31, 2012, related to the fixed-to-floating interest rate contracts. In addition, we had pre-tax net gains within AOCI related to terminated floating-to-fixed treasury locks of $3 million as of September 30, 2013 and $4 million as of December 31, 2012. We recorded $3 million during the third quarter of 2013 and $8 million during the first nine months of 2013 as a reduction to interest expense, resulting from the amortization of previously terminated interest rate derivative contracts. As of September 30, 2013, $9 million of pre-tax net gains may be reclassified to earnings within the next twelve months as a reduction to interest expense from amortization of our previously terminated interest rate derivative contracts. | ||||||||||||||||||||||||||||||||
Counterparty Credit Risk | ||||||||||||||||||||||||||||||||
We do not have significant concentrations of credit risk arising from our derivative financial instruments, whether from an individual counterparty or a related group of counterparties. We manage our concentration of counterparty credit risk on our derivative instruments by limiting acceptable counterparties to a diversified group of major financial institutions with investment grade credit ratings, limiting the amount of credit exposure to each counterparty, and by actively monitoring their credit ratings and outstanding fair values on an on-going basis. Furthermore, none of our derivative transactions are subject to collateral or other security arrangements and none contain provisions that are dependent on our credit ratings from any credit rating agency. | ||||||||||||||||||||||||||||||||
We also employ master netting arrangements that reduce our counterparty payment settlement risk on any given maturity date to the net amount of any receipts or payments due between us and the counterparty financial institution. Thus, the maximum loss due to counterparty credit risk is limited to the unrealized gains in such contracts net of any unrealized losses should any of these counterparties fail to perform as contracted. Although these protections do not eliminate concentrations of credit risk, as a result of the above considerations, we do not consider the risk of counterparty default to be significant. | ||||||||||||||||||||||||||||||||
Fair Value of Derivative Instruments | ||||||||||||||||||||||||||||||||
The following presents the effect of our derivative instruments designated as cash flow hedges under Topic 815 on our accompanying unaudited condensed consolidated statements of operations during the third quarter and first nine months of 2013 and 2012 (in millions): | ||||||||||||||||||||||||||||||||
Amount of Pre-tax | Amount of Pre-tax Gain (Loss) Reclassified from AOCI into Earnings | Location in Statement of | ||||||||||||||||||||||||||||||
Gain (Loss) | (Effective Portion) | Operations | ||||||||||||||||||||||||||||||
Recognized in OCI | ||||||||||||||||||||||||||||||||
(Effective Portion) | ||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | (45 | ) | $ | 15 | Cost of products sold | ||||||||||||||||||||||||||
$ | (45 | ) | $ | 15 | ||||||||||||||||||||||||||||
Three Months Ended September 30, 2012 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | (44 | ) | $ | (3 | ) | Cost of products sold | |||||||||||||||||||||||||
$ | (44 | ) | $ | (3 | ) | |||||||||||||||||||||||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | 144 | $ | 15 | Cost of products sold | |||||||||||||||||||||||||||
$ | 144 | $ | 15 | |||||||||||||||||||||||||||||
Nine Months Ended September 30, 2012 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | 2 | $ | (29 | ) | Cost of products sold | ||||||||||||||||||||||||||
$ | 2 | $ | (29 | ) | ||||||||||||||||||||||||||||
The amount of gain (loss) recognized in earnings related to the ineffective portion of hedging relationships was de minimis for all periods presented. | ||||||||||||||||||||||||||||||||
Net gains and losses on currency hedge contracts not designated as hedging instruments were offset by net losses and gains from foreign currency transaction exposures, as shown in the following table: | ||||||||||||||||||||||||||||||||
(in millions) | Location in Statement of Operations | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||||||||
Gain (loss) on currency hedge contracts | Other, net | $ | 12 | $ | (14 | ) | $ | 66 | $ | — | ||||||||||||||||||||||
Gain (loss) on foreign currency transaction exposures | Other, net | (15 | ) | 11 | (72 | ) | (13 | ) | ||||||||||||||||||||||||
Net foreign currency gain (loss) | Other, net | $ | (3 | ) | $ | (3 | ) | $ | (6 | ) | $ | (13 | ) | |||||||||||||||||||
Topic 815 requires all derivative instruments to be recognized at their fair values as either assets or liabilities on the balance sheet. We determine the fair value of our derivative instruments using the framework prescribed by ASC Topic 820, Fair Value Measurements and Disclosures (Topic 820), by considering the estimated amount we would receive or pay to transfer these instruments at the reporting date and by taking into account current interest rates, foreign currency exchange rates, the creditworthiness of the counterparty for assets, and our creditworthiness for liabilities. In certain instances, we may utilize financial models to measure fair value. Generally, we use inputs that include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; other observable inputs for the asset or liability; and inputs derived principally from, or corroborated by, observable market data by correlation or other means. As of September 30, 2013, we have classified all of our derivative assets and liabilities within Level 2 of the fair value hierarchy prescribed by Topic 820, as discussed below, because these observable inputs are available for substantially the full term of our derivative instruments. | ||||||||||||||||||||||||||||||||
The following are the balances of our derivative assets and liabilities as of September 30, 2013 and December 31, 2012: | ||||||||||||||||||||||||||||||||
As of | ||||||||||||||||||||||||||||||||
(in millions) | Location in Balance Sheet (1) | 30-Sep-13 | 31-Dec-12 | |||||||||||||||||||||||||||||
Derivative Assets: | ||||||||||||||||||||||||||||||||
Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Prepaid and other current assets | $ | 88 | $ | 25 | |||||||||||||||||||||||||||
Currency hedge contracts | Other long-term assets | 95 | 63 | |||||||||||||||||||||||||||||
183 | 88 | |||||||||||||||||||||||||||||||
Non-Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Prepaid and other current assets | 17 | 33 | |||||||||||||||||||||||||||||
Total Derivative Assets | $ | 200 | $ | 121 | ||||||||||||||||||||||||||||
Derivative Liabilities: | ||||||||||||||||||||||||||||||||
Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Other current liabilities | $ | 8 | $ | 20 | |||||||||||||||||||||||||||
Currency hedge contracts | Other long-term liabilities | 9 | 10 | |||||||||||||||||||||||||||||
17 | 30 | |||||||||||||||||||||||||||||||
Non-Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Other current liabilities | 27 | 27 | |||||||||||||||||||||||||||||
Total Derivative Liabilities | $ | 44 | $ | 57 | ||||||||||||||||||||||||||||
-1 | We classify derivative assets and liabilities as current when the remaining term of the derivative contract is one year or less. | |||||||||||||||||||||||||||||||
Other Fair Value Measurements | ||||||||||||||||||||||||||||||||
Recurring Fair Value Measurements | ||||||||||||||||||||||||||||||||
On a recurring basis, we measure certain financial assets and financial liabilities at fair value based upon quoted market prices, where available. Where quoted market prices or other observable inputs are not available, we apply valuation techniques to estimate fair value. Topic 820 establishes a three-level valuation hierarchy for disclosure of fair value measurements. The categorization of financial assets and financial liabilities within the valuation hierarchy is based upon the lowest level of input that is significant to the measurement of fair value. The three levels of the hierarchy are defined as follows: | ||||||||||||||||||||||||||||||||
• | Level 1 – Inputs to the valuation methodology are quoted market prices for identical assets or liabilities. | |||||||||||||||||||||||||||||||
• | Level 2 – Inputs to the valuation methodology are other observable inputs, including quoted market prices for similar assets or liabilities and market-corroborated inputs. | |||||||||||||||||||||||||||||||
• | Level 3 – Inputs to the valuation methodology are unobservable inputs based on management’s best estimate of inputs market participants would use in pricing the asset or liability at the measurement date, including assumptions about risk. | |||||||||||||||||||||||||||||||
Assets and liabilities measured at fair value on a recurring basis consist of the following as of September 30, 2013 and December 31, 2012: | ||||||||||||||||||||||||||||||||
As of September 30, 2013 | As of December 31, 2012 | |||||||||||||||||||||||||||||||
(in millions) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Money market and government funds | $ | 155 | — | — | $ | 155 | $ | 39 | — | — | $ | 39 | ||||||||||||||||||||
Currency hedge contracts | — | $ | 200 | — | 200 | — | $ | 121 | — | 121 | ||||||||||||||||||||||
$ | 155 | $ | 200 | — | $ | 355 | $ | 39 | $ | 121 | — | $ | 160 | |||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Currency hedge contracts | — | $ | 44 | — | $ | 44 | — | $ | 57 | — | $ | 57 | ||||||||||||||||||||
Accrued contingent consideration | — | — | $ | 536 | 536 | — | — | $ | 663 | 663 | ||||||||||||||||||||||
— | $ | 44 | $ | 536 | $ | 580 | — | $ | 57 | $ | 663 | $ | 720 | |||||||||||||||||||
Our investments in money market and government funds are generally classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. These investments are classified as cash and cash equivalents within our accompanying unaudited condensed consolidated balance sheets, in accordance with U.S. GAAP and our accounting policies. | ||||||||||||||||||||||||||||||||
In addition to $155 million invested in money market and government funds as of September 30, 2013, we had $281 million in short-term time deposits and $135 million in interest bearing and non-interest bearing bank accounts. In addition to $39 million invested in money market and government funds as of December 31, 2012, we had $168 million in interest bearing and non-interest bearing bank accounts. | ||||||||||||||||||||||||||||||||
Changes in the fair value of assets and liabilities measured on a recurring basis using significant unobservable inputs (Level 3) during the first nine months of 2013 related solely to our contingent consideration liabilities. Refer to Note B - Acquisitions for a discussion of the fair value measurements related to our contingent consideration liabilities. | ||||||||||||||||||||||||||||||||
Non-Recurring Fair Value Measurements | ||||||||||||||||||||||||||||||||
We have certain assets and liabilities that are measured at fair value on a non-recurring basis in periods subsequent to initial recognition. The fair value of a cost method investment is not estimated if there are no identified events or changes in circumstances that may have a significant adverse effect on the fair value of the investment. The aggregate carrying amount of our cost method investments was $22 million as of September 30, 2013 and $13 million as of December 31, 2012. | ||||||||||||||||||||||||||||||||
During the third quarter of 2013, we recorded $4 million of losses to write down certain investments to their fair values. These adjustments fall within Level 3 of the fair value hierarchy, due to the use of significant unobservable inputs to determine fair value. | ||||||||||||||||||||||||||||||||
During the second quarter of 2013, we recorded $53 million of intangible asset impairment charges, representing a decrease in the estimated fair value of the related intangible asset balances. During the first quarter of 2013, we recorded a $423 million charge to adjust our goodwill balances to their fair value. As a result, during the first nine months of 2013, we recorded $476 million of losses, to adjust our goodwill and certain other intangible asset balances to their fair value. Refer to Note D - Goodwill and Other Intangible Assets, for further detailed information related to these charges and significant unobservable inputs (Level 3). | ||||||||||||||||||||||||||||||||
The fair value of our outstanding debt obligations was $4.599 billion as of September 30, 2013 and $4.793 billion as of December 31, 2012, which was determined by using primarily quoted market prices for our publicly registered senior notes, classified as Level 1 within the fair value hierarchy. Refer to Note F – Borrowings and Credit Arrangements for a discussion of our debt obligations. |
Borrowings_and_Credit_Arrangem
Borrowings and Credit Arrangements | 9 Months Ended | ||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||
Borrowings and Credit Arrangements [Abstract] | ' | ||||||||||||||||||||||||||
BORROWINGS AND CREDIT ARRANGEMENTS | ' | ||||||||||||||||||||||||||
BORROWINGS AND CREDIT ARRANGEMENTS | |||||||||||||||||||||||||||
We had total debt of $4.249 billion as of September 30, 2013 and $4.256 billion as of December 31, 2012. During the third quarter of 2013, we refinanced our public debt obligations maturing in June 2014 and January 2015 (see Senior Notes below). The debt maturity schedule for the significant components of our debt obligations as of September 30, 2013 is as follows: | |||||||||||||||||||||||||||
(in millions) | 2013 | 2014 | 2015 | 2016 | 2017 | Thereafter | Total | ||||||||||||||||||||
Senior notes | — | $ | — | $ | 400 | $ | 600 | $ | 250 | $ | 2,550 | $ | 3,800 | ||||||||||||||
Term loan | — | $ | — | $ | — | $ | 80 | $ | 80 | $ | 240 | $ | 400 | ||||||||||||||
— | $ | — | $ | 400 | $ | 680 | $ | 330 | $ | 2,790 | $ | 4,200 | |||||||||||||||
Note: | The table above does not include unamortized discounts associated with our senior notes, or amounts related to interest rate contracts used to hedge the fair value of certain of our senior notes. | ||||||||||||||||||||||||||
Revolving Credit Facility | |||||||||||||||||||||||||||
We maintain a $2.0 billion revolving credit facility, maturing in April 2017, with a global syndicate of commercial banks. Eurodollar and multicurrency loans under this revolving credit facility bear interest at LIBOR plus an interest margin of between 0.875 percent and 1.475 percent, based on our corporate credit ratings and consolidated leverage ratio (1.275 percent as of September 30, 2013). In addition, we are required to pay a facility fee based on our credit ratings, consolidated leverage ratio, and the total amount of revolving credit commitments, regardless of usage, under the agreement (0.225 percent as of September 30, 2013). There were no amounts borrowed under our revolving credit facility as of September 30, 2013 or December 31, 2012. | |||||||||||||||||||||||||||
Our revolving credit facility agreement in place as of September 30, 2013 requires that we maintain certain financial covenants, as follows: | |||||||||||||||||||||||||||
Covenant | Actual as of | ||||||||||||||||||||||||||
Requirement | 30-Sep-13 | ||||||||||||||||||||||||||
Maximum leverage ratio (1) | 3.5 times | 2.4 times | |||||||||||||||||||||||||
Minimum interest coverage ratio (2) | 3.0 times | 5.4 times | |||||||||||||||||||||||||
-1 | Ratio of total debt to consolidated EBITDA, as defined by the credit agreement, for the preceding four consecutive fiscal quarters. | ||||||||||||||||||||||||||
-2 | Ratio of consolidated EBITDA, as defined by the credit agreement, to interest expense for the preceding four consecutive fiscal quarters. | ||||||||||||||||||||||||||
The credit agreement provides for an exclusion from the calculation of consolidated EBITDA, as defined by the agreement, through the credit agreement maturity, of any non-cash charges up to $500 million in restructuring charges and restructuring-related expenses related to our current or future restructuring plans. As of September 30, 2013, we had $287 million of the restructuring charge exclusion remaining. In addition, any cash litigation payments (net of any cash litigation receipts), as defined by the agreement, are excluded from the calculation of consolidated EBITDA and any new debt issued to fund any tax deficiency payments is excluded from consolidated total debt, as defined in the agreement, provided that the sum of any excluded net cash litigation payments and any new debt issued to fund any tax deficiency payments shall not exceed $2.300 billion in the aggregate. As of September 30, 2013, we had approximately $2.278 billion of the combined legal and debt exclusion remaining. As of and through September 30, 2013, we were in compliance with the required covenants. | |||||||||||||||||||||||||||
Any inability to maintain compliance with these covenants could require us to seek to renegotiate the terms of our credit facilities or seek waivers from compliance with these covenants, both of which could result in additional borrowing costs. Further, there can be no assurance that our lenders would agree to such new terms or grant such waivers. | |||||||||||||||||||||||||||
Term Loan | |||||||||||||||||||||||||||
In August 2013, we entered into a new $400 million, unsecured term loan facility. Term loan borrowings under this facility bear interest at LIBOR plus an interest margin of between 1.0 percent and 1.75 percent (currently 1.5 percent), based on our corporate credit ratings and consolidated leverage ratio. The term loan borrowings are payable over a 5-year period, with quarterly principal payments of $20 million commencing in the first quarter of 2016 and the remaining principal amount due at the final maturity date in August 2018, and are repayable at any time without premium or penalty. Our term loan facility requires that we comply with certain covenants, including financial covenants with respect to maximum leverage and minimum interest coverage; the maximum leverage ratio requirement is 3.5 times, our actual leverage ratio as of September 30, 2013 is 2.4 times and the minimum interest coverage ratio requirement is 3.0 times, our actual interest coverage ratio as of September 30, 2013 is 5.4 times. We had $400 million outstanding under this facility as of September 30, 2013 and no borrowings outstanding as of December 31, 2012. | |||||||||||||||||||||||||||
Senior Notes | |||||||||||||||||||||||||||
We had senior notes outstanding of $3.800 billion and $4.200 billion as of September 30, 2013 and December 31, 2012 respectively. In August 2013, we issued $600 million of 2.650% senior notes due in 2018, and $450 million of 4.125% senior notes due in 2023. In September 2013, we used the proceeds, together with borrowings under our new $400 million term loan facility, to prepay $600 million of senior notes maturing in June 2014 and $850 million maturing in January 2015. We recorded a one-time charge of $70 million ($44 million after-tax) for premiums, accelerated amortization of debt issuance costs and investor discount costs net of interest rate hedge gains related to the early debt extinguishment. Our senior notes are publicly registered securities, are redeemable prior to maturity and are not subject to any sinking fund requirements. Our senior notes are unsecured, unsubordinated obligations and rank on parity with each other. These notes are effectively junior to borrowings under our credit and security facility and liabilities of our subsidiaries (see Other Arrangements below). | |||||||||||||||||||||||||||
Other Arrangements | |||||||||||||||||||||||||||
We also maintain a credit and security facility secured by our U.S. trade receivables. In June 2013, we extended the maturity of this facility through June 2015, subject to further extension, reduced the size of the facility from $350 million to $300 million and added a maximum leverage covenant consistent with our revolving credit facility. The maximum leverage ratio requirement is 3.5 times and our actual leverage ratio as of September 30, 2013 is 2.4 times. We had no borrowings outstanding under this facility as of September 30, 2013 and December 31, 2012. | |||||||||||||||||||||||||||
We have accounts receivable factoring programs in certain European countries that we account for as sales under ASC Topic 860, Transfers and Servicing. These agreements provide for the sale of accounts receivable to third parties, without recourse, of up to approximately $306 million as of September 30, 2013. We have no retained interests in the transferred receivables, other than collection and administrative responsibilities and, once sold, the accounts receivable are no longer available to satisfy creditors in the event of bankruptcy. We de-recognized $166 million of receivables as of September 30, 2013 at an average interest rate of 3.3 percent, and $191 million as of December 31, 2012 at an average interest rate of 1.6 percent. Within Italy, Spain, Portugal and Greece the number of days our receivables are outstanding has increased above historical levels. We believe we have adequate allowances for doubtful accounts related to our Italy, Spain, Portugal and Greece accounts receivable; however, we continue to monitor the European economic environment for any collectibility issues related to our outstanding receivables. As of September 30, 2013, our net receivables in these countries greater than 180 days past due totaled $78 million, of which $28 million were past due greater than 365 days. | |||||||||||||||||||||||||||
In addition, we have uncommitted credit facilities with a commercial Japanese bank that provide for borrowings, promissory notes discounting, and receivables factoring of up to 21.0 billion Japanese yen (approximately $214 million as of September 30, 2013). We de-recognized $156 million of notes receivable as of September 30, 2013 at an average interest rate of 1.8 percent and $182 million of notes receivable as of December 31, 2012 at an average interest rate of 1.6 percent. De-recognized accounts and notes receivable are excluded from trade accounts receivable, net in the accompanying unaudited condensed consolidated balance sheets. | |||||||||||||||||||||||||||
As of September 30, 2013, we had outstanding letters of credit of $74 million, as compared to $94 million as of December 31, 2012, which consisted primarily of bank guarantees and collateral for workers' compensation insurance arrangements. As of September 30, 2013 and December 31, 2012, none of the beneficiaries had drawn upon the letters of credit or guarantees; accordingly, we did not recognize a related liability for our outstanding letters of credit in our consolidated balance sheets as of September 30, 2013 or December 31, 2012. We believe we will generate sufficient cash from operations to fund these payments and intend to fund these payments without drawing on the letters of credit. |
Restructuring_Related_Activiti
Restructuring Related Activities | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Restructuring Charges [Abstract] | ' | |||||||||||||||||||||||
RESTRUCTURING-RELATED ACTIVITIES | ' | |||||||||||||||||||||||
RESTRUCTURING-RELATED ACTIVITIES | ||||||||||||||||||||||||
On an on-going basis, we monitor the dynamics of the economy, the healthcare industry, and the markets in which we compete. We continue to assess opportunities for improved operational effectiveness and efficiency, and better alignment of expenses with revenues, while preserving our ability to make the investments in research and development projects, capital and our people that we believe are essential to our long-term success. As a result of these assessments, we have undertaken various restructuring initiatives in order to enhance our growth potential and position us for long-term success. These initiatives are described below. | ||||||||||||||||||||||||
2014 Restructuring plan | ||||||||||||||||||||||||
On October 22, 2013, the Board of Directors approved, and we committed to, a restructuring initiative (the 2014 Restructuring plan). The 2014 Restructuring plan is intended to build on the progress we have made to address financial pressures in a changing global marketplace, further strengthen its operational effectiveness and efficiency and support new growth investments. Key activities under the plan include continued implementation of our ongoing Plant Network Optimization (PNO) strategy, continued focus on driving operational efficiencies and ongoing business and commercial model changes. The PNO strategy is intended to simplify our manufacturing plant structure by transferring certain production lines among facilities. Other activities involve rationalizing organizational reporting structures to streamline various functions, eliminate bureaucracy, increase productivity and better align resources to business strategies and marketplace dynamics. These activities will start to be initiated in the fourth quarter of 2013 and are expected to be substantially completed by the end of 2015. | ||||||||||||||||||||||||
We estimate that the implementation of the 2014 Restructuring plan will result in total pre-tax charges of approximately $175 million to $225 million, of which approximately $160 million to $210 million is expected to result in future cash outlays. The following table provides a summary of our estimates of costs associated with the 2014 Restructuring plan by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total estimated amount expected to | |||||||||||||||||||||||
be incurred | ||||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $120 million to $150 million | |||||||||||||||||||||||
Other (1) | $5 million to $15 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Other (2) | $50 million to $60 million | |||||||||||||||||||||||
$175 million to $225 million | ||||||||||||||||||||||||
(1) Consists primarily of consultant fees and costs associated with contractual cancellations. | ||||||||||||||||||||||||
(2) Comprised of other costs directly related to the 2014 Restructuring plan, including program management, accelerated depreciation, and costs to transfer product lines among facilities. | ||||||||||||||||||||||||
2011 Restructuring plan | ||||||||||||||||||||||||
On July 26, 2011, our Board of Directors approved, and we committed to, a restructuring initiative (the 2011 Restructuring plan) designed to strengthen operational effectiveness and efficiencies, increase competitiveness and support new investments, thereby increasing stockholder value. Key activities under the 2011 Restructuring plan include standardizing and automating certain processes and activities; relocating select administrative and functional activities; rationalizing organizational reporting structures; leveraging preferred vendors; and other efforts to eliminate inefficiency. Among these efforts, we are expanding our ability to deliver best-in-class global shared services for certain functions and divisions at several locations in emerging markets. This action is intended to enable us to grow our global commercial presence in key geographies and take advantage of many cost-reducing and productivity-enhancing opportunities. In addition, we are undertaking efforts to streamline various corporate functions, eliminate bureaucracy, increase productivity and better align corporate resources to our key business strategies. On January 25, 2013, our Board of Directors approved, and we committed to, an expansion of the 2011 Restructuring plan (the Expansion). The Expansion is intended to further strengthen our operational effectiveness and efficiencies and support new investments. Activities under the 2011 Restructuring plan were initiated in the third quarter of 2011 and all activities, including those related to the Expansion, are expected to be substantially complete by the end of 2013. | ||||||||||||||||||||||||
We estimate that the 2011 Restructuring plan, including the Expansion, will result in total pre-tax charges of approximately $300 million to $355 million, and that approximately $270 million to $300 million of these charges will result in future cash outlays, of which we have made payments of $235 million, which were partially offset by proceeds of $53 million on facility and fixed asset sales, as of September 30, 2013. As of September 30, 2013, we recorded costs of $260 million since the inception of the 2011 Restructuring plan, including the Expansion, and recorded a portion of these expenses as restructuring charges and the remaining portion through other lines within our unaudited condensed consolidated statements of operations. | ||||||||||||||||||||||||
The following provides a summary of our expected total costs associated with the 2011 Restructuring plan, including the Expansion, by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total estimated amount expected to | |||||||||||||||||||||||
be incurred | ||||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $160 million to $185 million | |||||||||||||||||||||||
Other (1) | $100 million to $120 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Other (2) | $40 million to $50 million | |||||||||||||||||||||||
$300 million to $355 million | ||||||||||||||||||||||||
-1 | Includes primarily consulting fees, gains and losses on disposals of fixed assets and costs associated with contractual cancellations. | |||||||||||||||||||||||
-2 | Comprised of other costs directly related to the 2011 Restructuring plan, including the Expansion, such as program management, accelerated depreciation, retention and infrastructure-related costs. | |||||||||||||||||||||||
2010 Restructuring plan | ||||||||||||||||||||||||
On February 6, 2010, our Board of Directors approved, and we committed to, a series of management changes and restructuring initiatives (the 2010 Restructuring plan) designed to focus our business, drive innovation, accelerate profitable revenue growth and increase both accountability and stockholder value. Key activities under the 2010 Restructuring plan included the restructuring of certain of our businesses and corporate functions; the re-alignment of our international structure to reduce our administrative costs and invest in expansion opportunities including significant investments in emerging markets; and the re-prioritization and diversification of our product portfolio. Activities under the 2010 Restructuring plan were initiated in the first quarter of 2010 and were complete by the end of 2012. | ||||||||||||||||||||||||
The execution of the 2010 Restructuring plan resulted in total pre-tax charges of $160 million, and required cash outlays of $145 million. | ||||||||||||||||||||||||
The following provides a summary of our costs associated with the 2010 Restructuring plan by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total amount incurred | |||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $90 million | |||||||||||||||||||||||
Fixed asset write-offs | $11 million | |||||||||||||||||||||||
Other (1) | $51 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Other (2) | $8 million | |||||||||||||||||||||||
$160 million | ||||||||||||||||||||||||
-1 | Includes primarily consulting fees and costs associated with contractual cancellations. | |||||||||||||||||||||||
-2 | Comprised of other costs directly related to the 2010 Restructuring plan, including accelerated depreciation and infrastructure-related costs. | |||||||||||||||||||||||
Plant Network Optimization program | ||||||||||||||||||||||||
In January 2009, our Board of Directors approved, and we committed to, a plant network optimization initiative (the Plant Network Optimization program), intended to simplify our manufacturing plant structure by transferring certain production lines among facilities and by closing certain other facilities. The program was a complement to the restructuring initiatives approved by our Board of Directors in 2007, and was intended to improve overall gross profit margins. Activities under the Plant Network Optimization program were initiated in the first quarter of 2009 and were substantially completed during 2012. | ||||||||||||||||||||||||
We estimate that the execution of the Plant Network Optimization program will result in total pre-tax charges of approximately $130 million, and that approximately $105 million to $110 million of these charges will result in cash outlays, of which we made payments of $103 million as of September 30, 2013. As of September 30, 2013, we recorded costs of $127 million since the inception of the plan, and recorded a portion of these expenses as restructuring charges and the remaining portion through cost of products sold within our unaudited condensed consolidated statements of operations. | ||||||||||||||||||||||||
The following provides a summary of our estimates of costs associated with the Plant Network Optimization program by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total estimated amount expected to | |||||||||||||||||||||||
be incurred | ||||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $33 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Accelerated depreciation | $22 million | |||||||||||||||||||||||
Transfer costs (1) | $75 million | |||||||||||||||||||||||
$130 million | ||||||||||||||||||||||||
-1 | Consists primarily of costs to transfer product lines among facilities, including costs of transfer teams, freight, idle facility and product line validations. | |||||||||||||||||||||||
In the aggregate, we recorded net restructuring charges pursuant to our restructuring plans of $19 million in the third quarter of 2013, $54 million in the third quarter of 2012, $55 million in the first nine months of 2013, and $93 million in the first nine months of 2012. During the first nine months of 2013, our restructuring charges were partially offset by a $19 million gain recognized on the sale of our Natick, Massachusetts headquarters. We are currently in the process of consolidating our Natick, Massachusetts headquarters into our Marlborough, Massachusetts location, where we are establishing a new global headquarters campus. In addition, we recorded expenses within other lines of our accompanying unaudited condensed consolidated statements of operations related to our restructuring initiatives of $7 million in the third quarter of 2013 and $4 million in the third quarter of 2012, and $16 million in the first nine months of 2013 and $15 million in the first nine months of 2012. | ||||||||||||||||||||||||
The following presents these costs (credits) by major type and line item within our accompanying unaudited condensed consolidated statements of operations, as well as by program: | ||||||||||||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 5 | $ | — | $ | — | $ | — | $ | 14 | $ | 19 | ||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | — | — | — | — | ||||||||||||||||||
Selling, general and administrative expenses | — | 1 | — | — | 6 | 7 | ||||||||||||||||||
— | 1 | — | — | 6 | 7 | |||||||||||||||||||
$ | 5 | $ | 1 | $ | — | $ | — | $ | 20 | $ | 26 | |||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 5 | $ | 1 | $ | — | $ | — | $ | 20 | $ | 26 | ||||||||||||
2010 Restructuring plan | — | — | — | — | — | — | ||||||||||||||||||
Plant Network Optimization program | — | — | — | — | — | — | ||||||||||||||||||
$ | 5 | $ | 1 | $ | — | $ | — | $ | 20 | $ | 26 | |||||||||||||
Three Months Ended September 30, 2012 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 44 | $ | — | $ | — | $ | — | $ | 10 | $ | 54 | ||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | 1 | — | — | 1 | ||||||||||||||||||
Selling, general and administrative expenses | — | — | — | — | 3 | 3 | ||||||||||||||||||
— | — | 1 | — | 3 | 4 | |||||||||||||||||||
$ | 44 | $ | — | $ | 1 | $ | — | $ | 13 | $ | 58 | |||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 43 | $ | — | $ | — | $ | — | $ | 13 | $ | 56 | ||||||||||||
2010 Restructuring plan | 2 | — | — | — | — | 2 | ||||||||||||||||||
Plant Network Optimization program | (1 | ) | — | 1 | — | — | — | |||||||||||||||||
$ | 44 | $ | — | $ | 1 | $ | — | $ | 13 | $ | 58 | |||||||||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 26 | $ | — | $ | — | $ | (16 | ) | $ | 45 | $ | 55 | |||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | — | — | — | — | ||||||||||||||||||
Selling, general and administrative expenses | — | 2 | — | — | 14 | 16 | ||||||||||||||||||
— | 2 | — | — | 14 | 16 | |||||||||||||||||||
$ | 26 | $ | 2 | $ | — | $ | (16 | ) | $ | 59 | $ | 71 | ||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 30 | $ | 2 | $ | — | $ | (16 | ) | $ | 59 | $ | 75 | |||||||||||
2010 Restructuring plan | — | — | — | — | — | — | ||||||||||||||||||
Plant Network Optimization program | (4 | ) | — | — | — | — | (4 | ) | ||||||||||||||||
$ | 26 | $ | 2 | $ | — | $ | (16 | ) | $ | 59 | $ | 71 | ||||||||||||
Nine Months Ended September 30, 2012 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 64 | $ | — | $ | — | $ | — | $ | 29 | $ | 93 | ||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | 7 | — | — | 7 | ||||||||||||||||||
Selling, general and administrative expenses | — | — | — | — | 8 | 8 | ||||||||||||||||||
— | — | 7 | — | 8 | 15 | |||||||||||||||||||
$ | 64 | $ | — | $ | 7 | $ | — | $ | 37 | $ | 108 | |||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 65 | $ | — | $ | — | $ | — | $ | 34 | $ | 99 | ||||||||||||
2010 Restructuring plan | — | — | — | — | 3 | 3 | ||||||||||||||||||
Plant Network Optimization program | (1 | ) | — | 7 | — | — | 6 | |||||||||||||||||
$ | 64 | $ | — | $ | 7 | $ | — | $ | 37 | $ | 108 | |||||||||||||
Termination benefits represent amounts incurred pursuant to our on-going benefit arrangements and amounts for “one-time” involuntary termination benefits, and have been recorded in accordance with ASC Topic 712, Compensation – Non-retirement Postemployment Benefits and ASC Topic 420, Exit or Disposal Cost Obligations (Topic 420). We expect to record additional termination benefits related to our restructuring initiatives in 2013 when we identify with more specificity the job classifications, functions and locations of the remaining head count to be eliminated. Other restructuring costs, which represent primarily consulting fees, are being recorded as incurred in accordance with Topic 420. Accelerated depreciation is being recorded over the adjusted remaining useful life of the related assets, and production line transfer costs are being recorded as incurred. | ||||||||||||||||||||||||
As of September 30, 2013, we have incurred cumulative restructuring charges related to our 2011 Restructuring plan (including the Expansion), 2010 Restructuring plan and Plant Network Optimization program of $411 million and restructuring-related costs of $136 million since we committed to each plan. The following presents these costs by major type and by plan: | ||||||||||||||||||||||||
(in millions) | 2011 | 2010 | Plant | Total | ||||||||||||||||||||
Restructuring | Restructuring | Network | ||||||||||||||||||||||
plan (including the Expansion) | plan | Optimization Program | ||||||||||||||||||||||
Termination benefits | $ | 130 | $ | 90 | $ | 31 | $ | 251 | ||||||||||||||||
Fixed asset write-offs | — | 11 | — | 11 | ||||||||||||||||||||
Other | 98 | 51 | — | 149 | ||||||||||||||||||||
Total restructuring charges | 228 | 152 | 31 | 411 | ||||||||||||||||||||
Accelerated depreciation | — | — | 22 | 22 | ||||||||||||||||||||
Transfer costs | — | — | 74 | 74 | ||||||||||||||||||||
Other | 32 | 8 | — | 40 | ||||||||||||||||||||
Restructuring-related expenses | 32 | 8 | 96 | 136 | ||||||||||||||||||||
$ | 260 | $ | 160 | $ | 127 | $ | 547 | |||||||||||||||||
We made cash payments of $36 million in the third quarter of 2013 and $107 million in the first nine months of 2013 associated with restructuring initiatives pursuant to these plans, and as of September 30, 2013, we had made total cash payments of $483 million related to our 2011 Restructuring plan (including the Expansion), 2010 Restructuring plan and Plant Network Optimization program since committing to each plan, partially offset by $53 million of proceeds received on facility and fixed asset sales in the first nine months of 2013. Payments were made using cash generated from operations, and are comprised of the following: | ||||||||||||||||||||||||
(in millions) | 2011 | 2010 | Plant | Total | ||||||||||||||||||||
Restructuring | Restructuring | Network | ||||||||||||||||||||||
plan (including the Expansion) | plan | Optimization Program | ||||||||||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||||||||||
Termination benefits | $ | 16 | $ | — | $ | — | $ | 16 | ||||||||||||||||
Transfer costs | — | — | — | — | ||||||||||||||||||||
Other | 20 | — | — | 20 | ||||||||||||||||||||
$ | 36 | $ | — | $ | — | $ | 36 | |||||||||||||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||
Termination benefits | $ | 49 | $ | — | $ | 1 | $ | 50 | ||||||||||||||||
Transfer costs | — | — | — | — | ||||||||||||||||||||
Other | 57 | — | — | 57 | ||||||||||||||||||||
$ | 106 | $ | — | $ | 1 | $ | 107 | |||||||||||||||||
Program to Date | ||||||||||||||||||||||||
Termination benefits | $ | 113 | $ | 90 | $ | 30 | $ | 233 | ||||||||||||||||
Transfer costs | — | — | 73 | 73 | ||||||||||||||||||||
Other | 122 | 55 | — | 177 | ||||||||||||||||||||
$ | 235 | $ | 145 | $ | 103 | $ | 483 | |||||||||||||||||
Our restructuring liability is primarily comprised of accruals for termination benefits. The following is a rollforward of the termination benefit liability associated with our 2011 Restructuring plan (including the Expansion), 2010 Restructuring plan and Plant Network Optimization program, since the inception of the respective plans, which is reported as a component of accrued expenses included in our accompanying unaudited condensed balance sheets: | ||||||||||||||||||||||||
Restructuring Plan Termination Benefits | ||||||||||||||||||||||||
(in millions) | 2011 | 2010 | Plant Network Optimization | Total | ||||||||||||||||||||
Accrued as of December 31, 2012 | $ | 36 | $ | 3 | $ | 9 | 48 | |||||||||||||||||
Charges (credits) | 30 | — | (4 | ) | 26 | |||||||||||||||||||
Cash payments | (49 | ) | — | (1 | ) | (50 | ) | |||||||||||||||||
Other adjustments | — | (3 | ) | — | (3 | ) | ||||||||||||||||||
Accrued as of September 30, 2013 | $ | 17 | $ | — | $ | 4 | $ | 21 | ||||||||||||||||
In addition to our accrual for termination benefits, we had an $10 million liability as of September 30, 2013 and a $5 million liability as of December 31, 2012 for other restructuring-related items. |
Supplemental_Balance_Sheet_Inf
Supplemental Balance Sheet Information | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Supplemental Balance Sheet Information [Abstract] | ' | ||||||||||||||||
SUPPLEMENTAL BALANCE SHEET INFORMATION | ' | ||||||||||||||||
SUPPLEMENTAL BALANCE SHEET INFORMATION | |||||||||||||||||
Components of selected captions in our accompanying unaudited condensed consolidated balance sheets are as follows: | |||||||||||||||||
Trade accounts receivable, net | |||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Accounts receivable | $ | 1,360 | $ | 1,336 | |||||||||||||
Less: allowance for doubtful accounts | (85 | ) | (88 | ) | |||||||||||||
Less: allowance for sales returns | (37 | ) | (31 | ) | |||||||||||||
$ | 1,238 | $ | 1,217 | ||||||||||||||
The following is a rollforward of our allowance for doubtful accounts for the third quarter and first nine months of 2013 and 2012: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in millions) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Beginning balance | $ | 84 | $ | 83 | $ | 88 | $ | 81 | |||||||||
Net (credits) charges to expenses | 2 | 1 | 7 | 7 | |||||||||||||
Utilization of allowances | (1 | ) | (2 | ) | (10 | ) | (6 | ) | |||||||||
Ending balance | $ | 85 | $ | 82 | $ | 85 | $ | 82 | |||||||||
Inventories | |||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Finished goods | $ | 592 | $ | 598 | |||||||||||||
Work-in-process | 87 | 70 | |||||||||||||||
Raw materials | 216 | 216 | |||||||||||||||
$ | 895 | $ | 884 | ||||||||||||||
Property, plant and equipment, net | |||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Land | $ | 81 | $ | 81 | |||||||||||||
Buildings and improvements | 912 | 873 | |||||||||||||||
Equipment, furniture and fixtures | 2,446 | 2,348 | |||||||||||||||
Capital in progress | 177 | 218 | |||||||||||||||
3,616 | 3,520 | ||||||||||||||||
Less: accumulated depreciation | 2,086 | 1,956 | |||||||||||||||
$ | 1,530 | $ | 1,564 | ||||||||||||||
Depreciation expense was $72 million for the third quarter of 2013 and $70 million for the third quarter of 2012, $199 million for the first nine months of 2013, and $205 million for the first nine months of 2012. | |||||||||||||||||
Accrued expenses | |||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Payroll and related liabilities | $ | 450 | $ | 452 | |||||||||||||
Accrued contingent consideration | 170 | 120 | |||||||||||||||
Legal reserves | 159 | 100 | |||||||||||||||
Other | 567 | 612 | |||||||||||||||
$ | 1,346 | $ | 1,284 | ||||||||||||||
Other long-term liabilities | |||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Accrued income taxes | $ | 1,274 | $ | 1,215 | |||||||||||||
Accrued contingent consideration | 366 | 543 | |||||||||||||||
Legal reserves | 524 | 391 | |||||||||||||||
Other long-term liabilities | 419 | 398 | |||||||||||||||
$ | 2,583 | $ | 2,547 | ||||||||||||||
Accrued warranties | |||||||||||||||||
We offer warranties on certain of our product offerings. The majority of our warranty liability as of September 30, 2013 related to implantable devices offered by our CRM business, which include defibrillator and pacemaker systems. Our CRM products come with a standard limited warranty covering the replacement of these devices. We offer a full warranty for a portion of the period post-implant, and a partial warranty over the substantial remainder of the useful life of the product. We estimate the costs that we may incur under our warranty programs based on the number of units sold, historical and anticipated rates of warranty claims and cost per claim, and record a liability equal to these estimated costs as cost of products sold at the time the product sale occurs. We reassess the adequacy of our recorded warranty liabilities on a quarterly basis and adjust these amounts as necessary. The current portion of our warranty accrual is included in other accrued expenses in the table above and the non-current portion of our warranty accrual is included in other long-term liabilities in the table above. Changes in our product warranty accrual during the first nine months of 2013 and 2012 consisted of the following (in millions): | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Beginning Balance | $ | 26 | $ | 30 | |||||||||||||
Provision | 11 | 6 | |||||||||||||||
Settlements/reversals | (9 | ) | (9 | ) | |||||||||||||
Ending Balance | $ | 28 | $ | 27 | |||||||||||||
Income_Taxes
Income Taxes | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Income Tax Expense (Benefit) [Abstract] | ' | ||||||
INCOME TAXES | ' | ||||||
INCOME TAXES | |||||||
Tax Rate | |||||||
The following tables provide a summary of our reported tax rate: | |||||||
Three Months Ended | |||||||
September 30, | |||||||
2013 | 2012 | ||||||
Reported tax rate | 87.6 | % | (0.1 | )% | |||
Impact of certain receipts/charges* | (74.5 | )% | 16.2 | % | |||
13.1 | % | 16.1 | % | ||||
Nine Months Ended | |||||||
September 30, | |||||||
2013 | 2012 | ||||||
Reported tax rate | 18.9 | % | 0.7 | % | |||
Impact of certain receipts/charges* | (5.2 | )% | 14.5 | % | |||
13.7 | % | 15.2 | % | ||||
*These receipts/charges are taxed at different rates than our effective tax rate. | |||||||
The change in our reported tax rate for the third quarter and first nine months of 2013, as compared to the same periods in 2012, relates primarily to the impact of certain receipts and charges that are taxed at different rates than our effective tax rate and the impact of certain discrete tax items. In the third quarter of 2013, the receipts and charges included debt extinguishment charges, and acquisition-, litigation- and restructuring-related charges. In addition, the reported tax rate in the third quarter of 2013 was affected favorably by discrete tax items, primarily related to re-measurement of uncertain tax positions. In the first nine months of 2013, the receipts and charges included goodwill and intangible asset impairment charges, debt extinguishment charges, acquisition- and divestiture-related net credits, and litigation- and restructuring-related charges. In addition, the reported tax rate for the first nine months of 2013 was affected favorably by discrete tax items primarily related to the reinstatement of tax legislation that has been retroactively applied, offset in part by re-measurement and resolution of uncertain tax positions. In the third quarter of 2012, the receipts and charges included goodwill and intangible asset impairment charges, acquisition- and divestiture-related net credits, and litigation- and restructuring-related charges. In addition, the reported tax rate in the third quarter of 2012 was affected unfavorably by discrete tax items primarily related to the re-measurement of an uncertain tax position. In the first nine months of 2012, the receipts and charges included goodwill and intangible asset impairment charges; litigation and restructuring-related net charges; and divestiture- and acquisition-related credits. In addition, the reported tax rate in the first nine months of 2012 was affected unfavorably by discrete tax items primarily related to the resolution and re-measurement of uncertain tax positions. | |||||||
As of September 30, 2013, we had $1.080 billion of gross unrecognized tax benefits, of which a net $940 million, if recognized, would affect our effective tax rate. As of December 31, 2012, we had $1.052 billion of gross unrecognized tax benefits, of which a net $902 million, if recognized, would affect our effective tax rate. | |||||||
We are subject to U.S. federal income tax as well as income tax of multiple state and foreign jurisdictions. We have concluded all U.S. federal income tax matters through 2000 and substantially all material state, local, and foreign income tax matters through 2001. | |||||||
We have received Notices of Deficiency from the Internal Revenue Service (IRS) reflecting proposed audit adjustments for Guidant Corporation (Guidant) for its 2001 through 2006 tax years and Boston Scientific Corporation for its 2006 and 2007 tax years (Notices). Subsequent to issuing these Notices, the IRS conceded a portion of its original assessment. The total incremental tax liability now asserted by the IRS for the applicable periods is $1.162 billion plus interest. The primary issue in dispute for all years is the transfer pricing in connection with the technology license agreements between domestic and foreign subsidiaries of Guidant. In addition, the IRS has proposed adjustments in connection with the financial terms of our Transaction Agreement with Abbott Laboratories (Abbott) pertaining to the sale of Guidant's vascular intervention business to Abbott in April 2006. We do not agree with the transfer pricing methodologies applied by the IRS or its resulting assessment and we believe that the IRS has exceeded its authority by attempting to adjust the terms of our negotiated third-party agreement with Abbott. In addition, we believe that the IRS positions with regard to these matters are inconsistent with the applicable tax laws and the existing Treasury regulations. | |||||||
We believe we have meritorious defenses for our tax filings and we have filed petitions with the U.S. Tax Court contesting the Notices for the tax years in challenge. No payments on the net assessment would be required until the dispute is definitively resolved, which, based on experiences of other companies, could take several years. We believe that our income tax reserves associated with these matters are adequate and the final resolution will not have a material impact on our financial condition or results of operations. However, final resolution is uncertain and could have a material impact on our financial condition, results of operations, or cash flows. | |||||||
We recognize interest and penalties related to income taxes as a component of income tax expense. We had $408 million accrued for gross interest and penalties as of September 30, 2013 and $364 million as of December 31, 2012. The increase in gross interest and penalties was $43 million, which was recognized in our unaudited condensed consolidated statements of operations. We recognized net tax expense related to interest and penalties of $9 million during the third quarter of 2013, $15 million during the third quarter of 2012, $28 million in the first nine months of 2013, and $26 million in the first nine months of 2012. | |||||||
It is reasonably possible that within the next 12 months we will resolve multiple issues including transfer pricing and transactional-related issues with foreign, federal and state taxing authorities, in which case we could record a reduction in our balance of unrecognized tax benefits of up to approximately $41 million. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies [Abstract] | ' |
COMMITMENTS AND CONTINGENCIES | ' |
COMMITMENTS AND CONTINGENCIES | |
The medical device market in which we primarily participate is largely technology driven. As a result, intellectual property rights, particularly patents and trade secrets, play a significant role in product development and differentiation. Over the years, there has been litigation initiated against us by others, including our competitors, claiming that our current or former product offerings infringe patents owned or licensed by them. Intellectual property litigation is inherently complex and unpredictable. In addition, competing parties frequently file multiple suits to leverage patent portfolios across product lines, technologies and geographies and to balance risk and exposure between the parties. In some cases, several competitors are parties in the same proceeding, or in a series of related proceedings, or litigate multiple features of a single class of devices. These forces frequently drive settlement not only for individual cases, but also for a series of pending and potentially related and unrelated cases. Although monetary and injunctive relief is typically sought, remedies and restitution are generally not determined until the conclusion of the trial court proceedings and can be modified on appeal. Accordingly, the outcomes of individual cases are difficult to time, predict or quantify and are often dependent upon the outcomes of other cases in other geographies. | |
During recent years, we successfully negotiated closure of several long-standing legal matters and have received favorable legal rulings in several other matters; however, there continues to be outstanding intellectual property litigation, particularly in the coronary stent market. Adverse outcomes in one or more of these matters could have a material adverse effect on our ability to sell certain products and on our operating margins, financial position, results of operations and/or liquidity. | |
In the normal course of business, product liability, securities and commercial claims are asserted against us. Similar claims may be asserted against us in the future related to events not known to management at the present time. We maintain an insurance policy providing limited coverage against securities claims, and we are substantially self-insured with respect to product liability claims and fully self-insured with respect to intellectual property infringement claims. The absence of significant third-party insurance coverage increases our potential exposure to unanticipated claims or adverse decisions. Product liability claims, securities and commercial litigation, and other legal proceedings in the future, regardless of their outcome, could have a material adverse effect on our financial position, results of operations and/or liquidity. | |
In addition, like other companies in the medical device industry, we are subject to extensive regulation by national, state and local government agencies in the United States and other countries in which we operate. From time to time we are the subject of qui tam actions and governmental investigations often involving regulatory, marketing and other business practices. These qui tam actions and governmental investigations could result in the commencement of civil and criminal proceedings, substantial fines, penalties and administrative remedies and have a material adverse effect on our financial position, results of operations and/or liquidity. | |
We record losses for claims in excess of the limits of purchased insurance in earnings at the time and to the extent they are probable and estimable. In accordance with ASC Topic 450, Contingencies, we accrue anticipated costs of settlement, damages, losses for general product liability claims and, under certain conditions, costs of defense, based on historical experience or to the extent specific losses are probable and estimable. Otherwise, we expense these costs as incurred. If the estimate of a probable loss is a range and no amount within the range is more likely, we accrue the minimum amount of the range. | |
Our accrual for legal matters that are probable and estimable was $683 million as of September 30, 2013 and $491 million as of December 31, 2012, and includes estimated costs of settlement, damages and defense. The increase in our legal accrual was primarily due to $206 million in litigation-related charges recorded during the first nine months of 2013. During the first nine months of 2012, we recorded $119 million of litigation related charges, which consisted of charges of $135 million, partially offset by credits of $16 million. We continue to assess certain litigation and claims to determine the amounts, if any, that management believes will be paid as a result of such claims and litigation and, therefore, additional losses may be accrued and paid in the future, which could materially adversely impact our operating results, cash flows and/or our ability to comply with our debt covenants. | |
In management’s opinion, we are not currently involved in any legal proceedings other than those disclosed in our 2012 Annual Report filed on Form 10-K, our Quarterly Reports filed on Form 10-Q for the quarters ended March 31, 2013 and June 30, 2013, and those specifically identified below, which, individually or in the aggregate, could have a material adverse effect on our financial condition, operations and/or cash flows. Unless included in our legal accrual or otherwise indicated below, a range of loss associated with any individual material legal proceeding cannot be estimated. | |
Patent Litigation | |
On February 1, 2008, Wyeth Corporation and Cordis Corporation filed an amended complaint for patent infringement against Abbott Laboratories, adding us and Boston Scientific Scimed, Inc. as additional defendants to the complaint. The suit alleged that the PROMUS® coronary stent system, supplied to us by Abbott, infringes three U.S. patents (the Morris patents) owned by Wyeth and licensed to Cordis. The suit was filed in the U.S. District Court for the District of New Jersey seeking monetary and injunctive relief. Wyeth and Cordis subsequently withdrew their infringement claim as to one of the patents, and the District Court found the remaining two patents invalid. Wyeth and Cordis filed an appeal and on June 26, 2013, the Court of Appeals for the Federal Circuit affirmed the District Court’s judgment in favor of Boston Scientific. On October 13, 2013, Wyeth’s motion for rehearing or rehearing en banc was denied. | |
On May 25, 2010, Dr. Jang filed suit against Boston Scientific Scimed, Inc. and us alleging breach of contract relating to certain patent rights covering stent technology. In October 2011, the U.S. District Court for the District of Delaware entered judgment in favor of us on the pleadings. On July 31, 2012, the District Court denied Dr. Jang's October 2011 motion for reconsideration or, in the alternative, permission to amend his complaint. Dr. Jang filed an appeal on August 28, 2012. On September 5, 2013, the Court of Appeals for the Third Circuit vacated the ruling and remanded the case to the District Court. | |
On May 16, 2013, Vascular Solutions, Inc. filed suit against the Company, alleging that its Guidezilla™ guide extension catheter infringes three U.S. patents owned by Vascular Solutions. The suit was filed in the U.S. District Court for the District of Minnesota seeking monetary and injunctive relief. On May 28, 2013 Vascular Solutions filed an amended complaint adding an allegation of copyright infringement. On June 10, 2013, Vascular Solutions filed a motion requesting a preliminary injunction. On July 11, 2013 the Company answered the amended complaint and filed a counterclaim against Vascular Solutions, alleging that its Guideliner™ guide extension catheter infringes a U.S. patent owned by the Company. A hearing on the motion for preliminary injunction was held on August 27, 2013. | |
On August 2, 2013, Medtronic Ardian Luxembourg S.a.r.l. filed a complaint against Boston Scientific Corporation and Boston Scientific Medizintechnik, GmbH in the Düsseldorf District Court in Germany alleging that the sale of the Company’s Vessix renal denervation product infringes a German patent owned by Medtronic Ardian. A hearing is scheduled for August 12, 2014. | |
On September 23, 2013, Kardiametrics, LLC filed a complaint in the United States District Court for the District of Delaware alleging that the sale of the Company’s FilterWire EZ Embolic Protection System, Sterling balloon catheters, Carotid NexStent and Carotid Wallstent products infringe two patents (the Azizi patents) owned by Kardiametrics. | |
Product Liability Litigation | |
As of November 4, 2013, there were over 17,000 product liability cases or claims asserted against us in various federal and state courts in the United States, inclusive of seven putative class actions. There were also over ten cases in Canada, inclusive of three putative class actions. Generally, the plaintiffs allege personal injury associated with use of our transvaginal surgical mesh products designed to treat stress urinary incontinence and pelvic organ prolapse, design and manufacturing claims, failure to warn, breach of warranty, fraud, violations of state consumer protection laws and loss of consortium claims. Many of the cases have been specially assigned to one judge in state court in Massachusetts. On February 7, 2012, the Judicial Panel on Multi-District Litigation (MDL) established MDL-2326 in the U.S. District Court for the Southern District of West Virginia and transferred the federal court transvaginal surgical mesh cases to MDL-2326 for coordinated pretrial proceedings. In addition, we were contacted by the Attorney General for the State of California in October 2012 informing us that their office and certain other state attorneys general offices intend to initiate a civil investigation into our sale of transvaginal surgical mesh products. We have established a product liability accrual for known and estimated future cases and claims asserted against us as well as costs of defense thereof associated with our transvaginal surgical mesh products. While we believe that our accrual associated with this matter is adequate, changes to this accrual may be required in the future as additional information becomes available. We intend to vigorously contest the cases and claims asserted against us; however, the final resolution is uncertain and could have a material impact on our results of operations, financial condition and/or liquidity. | |
Governmental Investigations and Qui Tam Matters | |
On October 17, 2008, we received a subpoena from the U.S. Department of Health and Human Services, Office of the Inspector General, requesting information related to the alleged use of a skin adhesive in certain of our CRM products. In early 2010, we learned that this subpoena was related to a qui tam action filed in the U.S. District Court for the Western District of New York. After the federal government declined to intervene in the original complaint, the relator in the qui tam action filed an amended complaint alleging that Guidant violated the False Claims Act by selling certain PRIZM 2 devices and seeking monetary damages. In July 2010, we were served with the amended unsealed qui tam complaint filed by James Allen, an alleged device recipient. The civil division of the U.S. Department of Justice (DOJ) was later allowed to intervene in the Allen qui tam action and to transfer the litigation to the U.S. District Court for the District of Minnesota. In January 2011, the DOJ filed a civil False Claims Act complaint against us and Guidant (and other related entities) in the Allen qui tam action. On May 7, 2013, the Chief Magistrate Judge stayed the previously set deadlines in the case while the parties were in settlement discussions. In October 2013 we entered into a settlement agreement with the parties pursuant to which we agreed to pay $30 million to the DOJ and $1 million in legal fees to Mr. Allen’s counsel, and we filed a joint motion with the parties to dismiss the case. | |
On August 3, 2012, we were served with a qui tam complaint that had previously been filed under seal against Boston Scientific Neuromodulation Corp. in the U.S. District Court for the District of New Jersey on March 2, 2011. On August 8, 2012, we learned that the federal government had previously declined to intervene in this matter. The relators’ complaint, now unsealed, alleges that Boston Scientific Neuromodulation Corp. violated the federal and various states' false claims acts through submission of fraudulent bills for implanted devices, under-reporting of certain adverse events, and promotion of off-label uses. On September 10, 2012, the relators filed an amended complaint revising and restating certain of the claims in the original complaint. Our motion to dismiss, filed subsequently, was denied on May 31, 2013, and on June 28, 2013, we answered the amended complaint and brought certain counterclaims arising from relators’ unauthorized removal of documents from the business during their employments, which the relators moved to dismiss on July 22, 2013. | |
Other Proceedings | |
On October 5, 2007, Dr. Tassilo Bonzel filed a complaint against Pfizer, Inc. and our Schneider subsidiaries and us in the District Court in Kassel, Germany alleging that a 1995 license agreement related to a catheter patent is invalid under German law and seeking monetary damages. In June 2009, the District Court dismissed all but one of Dr. Bonzel's claims and in October 2009, he added new claims. We opposed the addition of the new claims. The District Court ordered Dr. Bonzel to select the claims he would pursue and in January 2011, he made that selection. A hearing is scheduled for March 28, 2014. | |
On September 28, 2011, we served a complaint against Mirowski Family Ventures LLC in the U.S. District Court for the Southern District of Indiana for a declaratory judgment that we have paid all royalties owed and did not breach any contractual or fiduciary obligations arising out of a license agreement. Mirowski answered and filed counterclaims requesting damages. On May 13, 2013, Mirowski Family Ventures served the Company with a complaint alleging breach of contract in Montgomery County Circuit Court, Maryland, and they amended this complaint on August 1, 2013. On July 29, 2013, the Indiana case was dismissed. On September 10, 2013, the company removed the case to the United States District Court for the District of Maryland. | |
Refer to Note I - Income Taxes for information regarding our tax litigation. | |
Matters Concluded Since December 31, 2012 | |
On December 4, 2009, we, along with Boston Scientific Scimed, Inc., filed a complaint for patent infringement against Cordis Corporation alleging that its Cypher Mini™ stent product infringes a U.S. patent (the Jang patent) owned by us. In April 2011, the U.S. District Court for the District of Delaware granted summary judgment that Cordis willfully infringed the Jang patent. After a trial on damages in May 2011, the jury found in favor of Boston Scientific for lost profits of approximately $18.5 million and royalties of approximately $1 million. On March 13, 2012, the District Court granted our motion for enhanced damages, resulting in a total damages award of approximately $41 million. On February 12, 2013, the Court of Appeals affirmed the District Court's judgment in favor of Boston Scientific. | |
On November 17, 2009, Boston Scientific Scimed, Inc. filed suit against OrbusNeich Medical, Inc. and certain of its subsidiaries in the Hague District Court in the Netherlands alleging that OrbusNeich's sale of the Genous stent infringes a patent owned by us (the Keith patent) and seeking monetary damages and injunctive relief. On March 13, 2012, the Hague Court of Appeals denied our request for preliminary relief. On April 2, 2013, the Hague Court of Appeals found the Keith patent invalid. | |
In December 2007, we were informed by the U.S. Attorney's Office for the Northern District of Texas that it was conducting an investigation of allegations related to improper promotion of biliary stents for off-label uses. The allegations were set forth in a qui tam complaint, which named us and certain of our competitors. Following the federal government's decision not to intervene in the case, the U.S. District Court for the Northern District of Texas unsealed the complaint. In March 2011, the District Court issued an order granting our motion to dismiss and, in March 2012, issued its opinion ordering that all claims against us be dismissed, some of which were dismissed with prejudice and some of which were dismissed without prejudice to the relator's right to amend those claims. On September 14, 2012, the relator filed and served an amended complaint restating the claims that the District Court dismissed without prejudice. On January 17, 2013, the District Court granted our motion to dismiss with prejudice all of the relator's remaining claims against us, and on April 12, 2013, the District Court amended its order of dismissal to specify that it was final and appealable. On May 3, 2013, the relator voluntarily moved to dismiss his appeal of the January 17, 2013 order of dismissal, which he had filed with the U.S. Court of Appeals for the Fifth Circuit on February 15, 2013. The deadline for further appeals lapsed on May 13, 2013. | |
On January 15, 2010, Cordis Corporation filed a complaint against us and Boston Scientific Scimed, Inc. alleging that the PROMUS® coronary stent system, supplied to us by Abbott Laboratories, infringes three patents (the Fischell patents) owned by Cordis. The suit was filed in the U.S. District Court for the District of Delaware and sought monetary and injunctive relief. We filed counterclaims of invalidity and non-infringement. The District Court found that the PROMUS stent system does not infringe the Fischell patents and that our sales of this product were authorized. On May 13, 2013, the Court of Appeals for the Federal Circuit affirmed the District Court’s judgment in favor of Boston Scientific. The deadline for further appeals lapsed on August 12, 2013. | |
On October 21, 2011, the U.S. District Court for the District of Massachusetts unsealed a qui tam complaint that related to the subject matter of a U.S. Attorney for the District of Massachusetts investigation, which investigation has been discontinued and is described below, after the federal government declined to intervene in the matter. Subsequently, on January 30, 2012, the relator filed an amended complaint. On July 5, 2012, the District Court issued an opinion and order dismissing the amended complaint for lack of subject matter jurisdiction. On July 12, 2012, the relator appealed the judgment of dismissal to the U.S. Court of Appeals for the First Circuit, and oral argument was held on February 7, 2013. On May 31, 2013, the Court of Appeals rejected the relator's appeal and affirmed the dismissal of the amended complaint. The deadline for further appeals lapsed on August 29, 2013. | |
On March 16, 2009, OrbusNeich Medical, Inc. filed suit against us alleging that our VeriFLEX™ (Liberté®) bare-metal coronary stent system infringes two U.S. patents (the Addonizio and Pazienza patents) owned by it. The complaint also alleged breach of contract and misappropriation of trade secrets and seeks monetary and injunctive relief. The suit is pending in the U.S. District Court for the District of Massachusetts. In September 2009, OrbusNeich filed an amended complaint against us alleging additional state law claims. In March 2010, the District Court dismissed OrbusNeich's unjust enrichment and fraud claims, but denied our motion to dismiss the remaining state law claims. OrbusNeich amended its complaint in April 2010 to add another patent (another Addonizio patent). In January 2011, OrbusNeich amended its complaint to drop its misappropriation of trade secret, statutory and unfair competition claims and in July 2011, it further amended its complaint to include allegations that our ION™ coronary stent system infringes two additional patents. On February 24, 2012, the District Court granted our motion to stay the patent claims, and on June 4, 2012, the District Court stayed the breach of contract claim, in each case, pending re-examination of the patents in suit. In addition, in February 2013, Orbus International B.V. filed suits against the Company and two Dutch subsidiaries in the Hague District Court in the Netherlands and Orbus Medical GmbH filed suit against the Company and one of its subsidiaries in the Dusseldorf District Court in Germany. In March 2013, Orbus Medical Inc. and Orbus International B.V. filed suit against the Company and two of its Irish subsidiaries in the Irish Commercial Court in Dublin, Ireland. Each of these matters alleges that the Company’s sale of stent systems using the Element design infringe European patents owned by Orbus Medical Inc. and licensed to other Orbus entities. In one Dutch matter, Orbus sought cross-border, preliminary injunctive relief, which the court denied on July 9, 2013. In the other Dutch matter, Orbus is seeking damages and injunctive relief, and a hearing is scheduled for December 20, 2013. In one German matter, Orbus sought preliminary injunctive relief, which the Dusseldorf District Court granted on April 30, 2013. On that same date, we appealed the injunction to the Court of Appeals of Dusseldorf. In the other German matter, Orbus is seeking damages and injunctive relief, and a hearing is scheduled for May 14, 2014. In the Irish matter, Orbus is seeking damages and injunctive relief. In March 2013, two of the Company’s subsidiaries filed suit against Orbus Medical Inc. in the English High Court seeking a declaration that the sale of the stent systems with the Element design does not infringe two Orbus patents and seeking to have the two patents found invalid. On June 5, 2013, Orbus cancelled one of the two UK patents. On September 15, 2013, the parties entered into a settlement agreement that resolves all stent-related cases brought by the parties in Germany, the Netherlands, Ireland, the United Kingdom and the United States. The agreement includes a one-time payment from Boston Scientific to OrbusNeich, with no future financial obligations. | |
On March 22, 2010, we received a subpoena from the U.S. Attorney's Office for the District of Massachusetts seeking documents relating to the former Market Development Sales Organization that operated within our CRM business. On October 21, 2011, the U.S. District Court for the District of Massachusetts unsealed a qui tam complaint that related to the subject matter of the U.S. Attorney's investigation, after the federal government declined to intervene in the matter. Subsequently, on January 30, 2012, the relator filed an amended complaint. The District Court case has been concluded and is described above. On October 30, 2013, the U.S. Attorney’s office informed us that the government was discontinuing its investigation. |
Weighted_Average_Shares_Outsta
Weighted Average Shares Outstanding | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||
Weighted Average Number Of Shares Outstanding [Text Block] | ' | |||||||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | |||||||||||||
(in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Weighted average shares outstanding - basic | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 | ||||||||||
Net effect of common stock equivalents | — | * | — | ** | — | * | — | ** | ||||||
Weighted average shares outstanding - assuming dilution | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 | ||||||||||
* We generated net losses in the third quarter and first nine months of 2013. Our weighted-average shares outstanding for earnings per share calculations exclude common stock equivalents of 23.6 million for the third quarter of 2013 and 17.2 million for the first nine months of 2013 due to our net loss position in these periods. | ||||||||||||||
** We generated net losses in the third quarter and first nine months of 2012. Our weighted-average shares outstanding for earnings per share calculations exclude common stock equivalents of 6.8 million for the third quarter of 2012 and 7.2 million for the first nine months of 2012 due to our net loss position in these periods. | ||||||||||||||
Weighted average shares outstanding, assuming dilution, excludes the impact of 18 million stock options for the third quarter of 2013, 62 million stock options for the third quarter of 2012, 18 million stock options for the first nine months of 2013, and 61 million stock options for the first nine months of 2012, due to the exercise prices of these stock options being greater than the average fair market value of our common stock during the period. | ||||||||||||||
We issued approximately six million shares of our common stock in the third quarter of 2013 and approximately 16 million shares in the first nine months of 2013, following the exercise or vesting of underlying stock options or deferred stock units, or purchases under our employee stock purchase plans. We repurchased approximately seven million shares of our common stock during the third quarter of 2013 for $75 million, and approximately 32 million shares during the first nine months of 2013 for $275 million, pursuant to our authorized repurchase programs as discussed in Note L – Stockholders' Equity to our audited financial statements contained in Item 8 of our 2012 Annual Report on Form 10-K. |
Segment_Reporting
Segment Reporting | 9 Months Ended | |||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||
SEGMENT REPORTING | ' | |||||||||||||||||
SEGMENT REPORTING | ||||||||||||||||||
Effective as of January 1, 2013, we reorganized our business from geographic regions to fully operationalized global business units. Following the reorganization, based on information regularly reviewed by our chief operating decision maker, we have three new reportable segments comprised of: Cardiovascular, Rhythm Management, and MedSurg. Our reportable segments represent an aggregate of operating segments. We have restated the prior period to conform to the current year presentation of our reportable segments. | ||||||||||||||||||
Each of our reportable segments generates revenues from the sale of medical devices. We measure and evaluate our reportable segments based on segment net sales and operating income, excluding the impact of changes in foreign currency exchange rates and sales from divested businesses. Sales generated from reportable segments and divested businesses, as well as operating results of reportable segments and corporate expenses, are based on internally-derived standard currency exchange rates, which may differ from year to year, and do not include intersegment profits. We restated segment information for the prior period based on standard currency exchange rates used for the current period in order to remove the impact of foreign currency exchange fluctuations. Based on information regularly reviewed by our chief operating decision maker following our reorganization, we also restated certain expenses associated with our manufacturing and corporate operations. We exclude from segment operating income certain corporate-related expenses and certain transactions or adjustments that our chief operating decision maker considers to be non-recurring and/or non-operational, such as amounts related to goodwill and other intangible asset impairment charges; acquisition-, divestiture-, restructuring-, and litigation-related charges and credits; and amortization expense. Although we exclude these amounts from segment operating income, they are included in reported consolidated operating income (loss) and are included in the reconciliation below. | ||||||||||||||||||
A reconciliation of the totals reported for the reportable segments to the applicable line items in our accompanying unaudited condensed consolidated statements of operations is as follows: | ||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
(in millions) | 2013 | 2012* | 2013 | 2012* | ||||||||||||||
Net sales | ||||||||||||||||||
Interventional Cardiology | $ | 487 | $ | 496 | $ | 1,538 | $ | 1,646 | ||||||||||
Peripheral Interventions | 202 | 188 | 601 | 571 | ||||||||||||||
Cardiovascular | 689 | 684 | 2,139 | 2,217 | ||||||||||||||
Cardiac Rhythm Management | 474 | 467 | 1,445 | 1,466 | ||||||||||||||
Electrophysiology | 35 | 35 | 106 | 109 | ||||||||||||||
Rhythm Management | 509 | 502 | 1,551 | 1,575 | ||||||||||||||
Endoscopy | 331 | 308 | 979 | 916 | ||||||||||||||
Urology/Women's Health | 134 | 124 | 378 | 367 | ||||||||||||||
Neuromodulation | 116 | 88 | 316 | 263 | ||||||||||||||
MedSurg | 581 | 520 | 1,673 | 1,546 | ||||||||||||||
Net sales allocated to reportable segments | 1,779 | 1,706 | 5,363 | 5,338 | ||||||||||||||
Sales generated from divested businesses | 2 | 32 | 56 | 91 | ||||||||||||||
Impact of foreign currency fluctuations | (46 | ) | (3 | ) | (114 | ) | (1 | ) | ||||||||||
$ | 1,735 | $ | 1,735 | $ | 5,305 | $ | 5,428 | |||||||||||
Income (loss) before income taxes | ||||||||||||||||||
Cardiovascular | $ | 184 | $ | 175 | $ | 548 | $ | 561 | ||||||||||
Rhythm Management | 68 | 58 | 192 | 218 | ||||||||||||||
MedSurg | 187 | 169 | 521 | 452 | ||||||||||||||
Operating income allocated to reportable segments | 439 | 402 | 1,261 | 1,231 | ||||||||||||||
Corporate expenses and currency exchange | (103 | ) | (58 | ) | (251 | ) | (214 | ) | ||||||||||
Goodwill and other intangible asset impairment charges; and acquisition-, divestiture-, restructuring-, and litigation related charges and credits | (132 | ) | (839 | ) | (711 | ) | (4,708 | ) | ||||||||||
Amortization expense | (101 | ) | (99 | ) | (305 | ) | (294 | ) | ||||||||||
Operating (loss) income | 103 | (594 | ) | (6 | ) | (3,985 | ) | |||||||||||
Other expense, net | (143 | ) | (69 | ) | (276 | ) | (174 | ) | ||||||||||
Income (loss) before income taxes | $ | (40 | ) | $ | (663 | ) | $ | (282 | ) | $ | (4,159 | ) | ||||||
* We have restated prior year detail to conform to current year presentation. |
Changes_in_Other_Comprehensive
Changes in Other Comprehensive Income | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Changes in Other Comprehensive Income [Abstract] | ' | ||||
Comprehensive Income (Loss) Note [Text Block] | ' | ||||
CHANGES IN OTHER COMPREHENSIVE INCOME | |||||
The following table provides the reclassifications out of other comprehensive income for the three and nine months ended September 30, 2013 and September 30, 2012. Amounts in the chart below are presented net of tax. | |||||
Three Months Ended September 30, 2013 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($28) | $153 | ($41) | $84 | |
Other comprehensive income (loss) before reclassifications | 10 | -29 | — | -19 | |
Amounts reclassified from accumulated other comprehensive income | — | -9 | — | -9 | |
Net current-period other comprehensive income | 10 | -38 | — | -28 | |
Ending Balance | ($18) | $115 | ($41) | $56 | |
Three Months Ended September 30, 2012 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($51) | ($4) | ($32) | ($87) | |
Other comprehensive income (loss) before reclassifications | 2 | -29 | — | -27 | |
Amounts reclassified from accumulated other comprehensive income | — | 2 | — | 2 | |
Net current-period other comprehensive income | 2 | -27 | — | -25 | |
Ending Balance | ($49) | ($31) | ($32) | ($112) | |
Nine Months Ended September 30, 2013 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($26) | $34 | ($41) | ($33) | |
Other comprehensive income (loss) before reclassifications | 8 | 91 | — | 99 | |
Amounts reclassified from accumulated other comprehensive income | — | -10 | — | -10 | |
Net current-period other comprehensive income | 8 | 81 | — | 89 | |
Ending Balance | ($18) | $115 | ($41) | $56 | |
Nine Months Ended September 30, 2012 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($58) | ($48) | ($32) | ($138) | |
Other comprehensive income (loss) before reclassifications | 9 | — | — | 9 | |
Amounts reclassified from accumulated other comprehensive income | — | 17 | — | 17 | |
Net current-period other comprehensive income | 9 | 17 | — | 26 | |
Ending Balance | ($49) | ($31) | ($32) | ($112) | |
The income tax impact of the amounts in other comprehensive income for unrealized gains/losses on derivative financial instruments before reclassifications was a benefit of $16 million in the third quarter of 2013, an expense of $53 million in the first nine months of 2013, a benefit of $17 million in the third quarter of 2012, and an expense of $1 million in the first nine months of 2012. The income tax impact of the amounts reclassified from unrealized gains/losses on derivative financial instruments was a benefit of $6 million in the third quarter and a benefit of $5 million in the first nine months of 2013, an expense of $1 million in the third quarter of 2012, and an expense of $9 million in the first nine months of 2012. Refer to Note E – Fair Value Measurements for further detail on the reclassifications related to derivatives. |
New_Accounting_Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2013 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ' |
NEW ACCOUNTING PRONOUNCEMENTS | ' |
NEW ACCOUNTING PRONOUNCEMENTS | |
Standards Implemented | |
ASC Update No. 2013-02 | |
In February 2013, the FASB issued ASC Update No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified out of Accumulated Other Comprehensive Income. Update No. 2013-02 requires that entities provide information about amounts reclassified out of accumulated other comprehensive income by component. The amendment also requires entities to present significant amounts by the respective line items of net income, either on the face of the income statement or in the notes to the financial statements for amounts required to be reclassified out of accumulated other comprehensive income in their entirety in the same reporting period. For other amounts that are not required to be reclassified to net income in their entirety, a cross-reference is required to other disclosures that provide additional details about those amounts. We adopted Update No. 2013-02 beginning in our first quarter ended March 31, 2013. Update No. 2013-02 is related to presentation only and its adoption did not impact our results of operations or financial position. | |
ASC Update No. 2013-01 | |
In January 2013, the FASB issued ASC Update No. 2013-01, Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities. Update No. 2013-01 clarifies the FASB's intent about requiring enhanced disclosures about certain financial instruments and derivative instruments that are offset in the statement of financial position or that are subject to enforceable master netting arrangements or similar agreements, previously issued ASC Update No. 2011-11, Disclosures about Offsetting Assets and Liabilities (Topic 210). We adopted Update No. 2013-01 beginning in our first quarter ended March 31, 2013. The adoption of Update No. 2013-01 did not impact our results of operations or financial position. | |
Standards to be Implemented | |
ASC Update No. 2013-11 | |
In July 2013, the FASB issued ASC Update No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. Update No. 2013-11 requires that entities present an unrecognized tax benefit, or portion of an unrecognized tax benefit, as a reduction to a deferred tax asset in the financial statements for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, with certain exceptions. We are required to adopt Update No. 2013-11 for our first quarter ending March 31, 2014, and early adoption is permitted. Update No. 2013-11 is related to presentation only and its adoption will not impact our results of operations or financial position. |
Accounting_Policies_Policies
Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies (Policies) [Abstract] | ' |
Legal Costs, Policy [Policy Text Block] | ' |
We record losses for claims in excess of the limits of purchased insurance in earnings at the time and to the extent they are probable and estimable. In accordance with ASC Topic 450, Contingencies, we accrue anticipated costs of settlement, damages, losses for general product liability claims and, under certain conditions, costs of defense, based on historical experience or to the extent specific losses are probable and estimable. Otherwise, we expense these costs as incurred. If the estimate of a probable loss is a range and no amount within the range is more likely, we accrue the minimum amount of the range. | |
ASC Topic 820, Fair Value Measurements and Disclosures | ' |
We determine the fair value of our derivative instruments using the framework prescribed by ASC Topic 820, Fair Value Measurements and Disclosures (Topic 820), by considering the estimated amount we would receive or pay to transfer these instruments at the reporting date and by taking into account current interest rates, foreign currency exchange rates, the creditworthiness of the counterparty for assets, and our creditworthiness for liabilities. In certain instances, we may utilize financial models to measure fair value. Generally, we use inputs that include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; other observable inputs for the asset or liability; and inputs derived principally from, or corroborated by, observable market data by correlation or other means. | |
ASC Topic 815, Derivatives and Hedging | ' |
We recognize all derivative financial instruments in our consolidated financial statements at fair value in accordance with ASC Topic 815, Derivatives and Hedging (Topic 815). In accordance with Topic 815, for those derivative instruments that are designated and qualify as hedging instruments, the hedging instrument must be designated, based upon the exposure being hedged, as a fair value hedge, cash flow hedge, or a hedge of a net investment in a foreign operation. The accounting for changes in the fair value (i.e. gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. Our derivative instruments do not subject our earnings or cash flows to material risk, as gains and losses on these derivatives generally offset losses and gains on the item being hedged. We do not enter into derivative transactions for speculative purposes and we do not have any non-derivative instruments that are designated as hedging instruments pursuant to Topic 815. | |
ASC Topic 712, Compensation - Non-retirement Postemployment Benefits and ASC Topic 420, Exit or Disposal Cost Obligations | ' |
Termination benefits represent amounts incurred pursuant to our on-going benefit arrangements and amounts for “one-time” involuntary termination benefits, and have been recorded in accordance with ASC Topic 712, Compensation – Non-retirement Postemployment Benefits and ASC Topic 420, Exit or Disposal Cost Obligations (Topic 420). We expect to record additional termination benefits related to our restructuring initiatives in 2013 when we identify with more specificity the job classifications, functions and locations of the remaining head count to be eliminated. Other restructuring costs, which represent primarily consulting fees, are being recorded as incurred in accordance with Topic 420. Accelerated depreciation is being recorded over the adjusted remaining useful life of the related assets, and production line transfer costs are being recorded as incurred. | |
ASC Topic 2013-01, Balance Sheet | ' |
ASC Update No. 2013-01 | |
In January 2013, the FASB issued ASC Update No. 2013-01, Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities. Update No. 2013-01 clarifies the FASB's intent about requiring enhanced disclosures about certain financial instruments and derivative instruments that are offset in the statement of financial position or that are subject to enforceable master netting arrangements or similar agreements, previously issued ASC Update No. 2011-11, Disclosures about Offsetting Assets and Liabilities (Topic 210). We adopted Update No. 2013-01 beginning in our first quarter ended March 31, 2013. The adoption of Update No. 2013-01 did not impact our results of operations or financial position. | |
Subsequent Events, Policy [Policy Text Block] | ' |
Subsequent Events | |
We evaluate events occurring after the date of our most recent accompanying unaudited condensed consolidated balance sheets for potential recognition or disclosure in our financial statements. We did not identify any material subsequent events requiring adjustment to our accompanying unaudited condensed consolidated financial statements (recognized subsequent events) for the three and nine month periods ended September 30, 2013. Those items requiring disclosure (unrecognized subsequent events) in the financial statements have been disclosed accordingly. Refer to Note J - Commitments and Contingencies and Note B - Acquisitions for more information. | |
ASC Topic 2013-02, Comprehensive Income | ' |
ASC Update No. 2013-02 | |
In February 2013, the FASB issued ASC Update No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified out of Accumulated Other Comprehensive Income. Update No. 2013-02 requires that entities provide information about amounts reclassified out of accumulated other comprehensive income by component. The amendment also requires entities to present significant amounts by the respective line items of net income, either on the face of the income statement or in the notes to the financial statements for amounts required to be reclassified out of accumulated other comprehensive income in their entirety in the same reporting period. For other amounts that are not required to be reclassified to net income in their entirety, a cross-reference is required to other disclosures that provide additional details about those amounts. We adopted Update No. 2013-02 beginning in our first quarter ended March 31, 2013. Update No. 2013-02 is related to presentation only and its adoption did not impact our results of operations or financial position. | |
ASC Update No. 2013-11, Income Taxes (Topic 740) [Policy Text Block] | ' |
ASC Update No. 2013-11 | |
In July 2013, the FASB issued ASC Update No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. Update No. 2013-11 requires that entities present an unrecognized tax benefit, or portion of an unrecognized tax benefit, as a reduction to a deferred tax asset in the financial statements for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, with certain exceptions. We are required to adopt Update No. 2013-11 for our first quarter ending March 31, 2014, and early adoption is permitted. Update No. 2013-11 is related to presentation only and its adoption will not impact our results of operations or financial position. |
Acquisitions_Tables
Acquisitions (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Business Acquisition [Line Items] | ' | ||||||||
Schedule of Purchase Price Allocation [Table Text Block] | ' | ||||||||
The following summarizes the Cameron purchase price allocation (in millions): | |||||||||
Goodwill | $ | 314 | |||||||
Amortizable intangible assets | 42 | ||||||||
Indefinite-lived intangible assets | 48 | ||||||||
Other net assets | 1 | ||||||||
Deferred income taxes | 76 | ||||||||
$ | 481 | ||||||||
The components of the Cameron purchase price as of the acquisition date were as follows (in millions): | |||||||||
Cash, net of cash acquired | $ | 134 | |||||||
Fair value of contingent consideration | 259 | ||||||||
Fair value of prior interests | 79 | ||||||||
Fair value of debt assumed | 9 | ||||||||
$ | 481 | ||||||||
Rollforward of Fair Value of Contingent Consideration [Table Text Block] | ' | ||||||||
Changes in the fair value of our contingent consideration liability were as follows (in millions): | |||||||||
Balance as of December 31, 2012 | $ | (663 | ) | ||||||
Amounts recorded to acquisition purchase accounting | (6 | ) | |||||||
Net fair value adjustments | 18 | ||||||||
Payments made | 115 | ||||||||
Balance as of September 30, 2013 | $ | (536 | ) | ||||||
Business Acquisition, Purchase Price Allocation, Intangible Assets, Description [Table Text Block] | ' | ||||||||
We allocated a portion of the Cameron purchase price to specific intangible asset categories as follows: | |||||||||
Amount Assigned (in millions) | Weighted Average Amortization Period (in years) | Risk-Adjusted Discount Rates used in Purchase Price Allocation | |||||||
Amortizable intangible assets: | |||||||||
Technology-related | 40 | 11 | 14 | % | |||||
Customer relationships | 2 | 5 | 14 | % | |||||
Indefinite-lived intangible assets: | |||||||||
Purchased research and development | 48 | 14 | % | ||||||
90 | |||||||||
Contingent Consideration Liability [Member] | ' | ||||||||
Business Acquisition [Line Items] | ' | ||||||||
Description of unobservable inputs used in Level 3 fair value measurements [Table Text Block] | ' | ||||||||
The recurring Level 3 fair value measurements of our contingent consideration liability include the following significant unobservable inputs: | |||||||||
Contingent Consideration Liability | Fair Value as of September 30, 2013 | Valuation Technique | Unobservable Input | Range | |||||
Research and Development, Regulatory and Commercialization-based Milestones | $126 million | Probability Weighted Discounted Cash Flow | Discount Rate | 0.8% - 1.1% | |||||
Probability of Payment | 70% - 98% | ||||||||
Projected Year of Payment | 2013 - 2014 | ||||||||
Revenue-based Payments | $144 million | Discounted Cash Flow | Discount Rate | 12% - 18% | |||||
Probability of Payment | 15% - 100% | ||||||||
Projected Year of Payment | 2013 - 2018 | ||||||||
$266 million | Monte Carlo | Revenue Volatility | 13% - 28% | ||||||
Risk Free Rate | LIBOR Term Structure | ||||||||
Projected Year of Payment | 2013 - 2018 |
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets Goodwill (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Goodwill [Line Items] | ' | ||||||||||||||||
Schedule of Goodwill [Table Text Block] | ' | ||||||||||||||||
The following represents our goodwill balance by new global reportable segment. We restated the prior period information to conform to the current presentation: | |||||||||||||||||
(in millions) | Cardiovascular | Rhythm Management | MedSurg | Total | |||||||||||||
Balance as of December 31, 2012 (restated) | $ | 3,249 | $ | 577 | $ | 2,147 | $ | 5,973 | |||||||||
Purchase price adjustments | 3 | — | — | 3 | |||||||||||||
Goodwill acquired | — | — | — | — | |||||||||||||
Goodwill written off | — | (423 | ) | — | (423 | ) | |||||||||||
Balance as of September 30, 2013 | $ | 3,252 | $ | 154 | $ | 2,147 | $ | 5,553 | |||||||||
The following is a rollforward of accumulated goodwill write-offs by global reportable segment. We restated the prior period information to conform to the current period presentation: | |||||||||||||||||
(in millions) | Cardiovascular | Rhythm Management | MedSurg | Total | |||||||||||||
Accumulated write-offs as of December 31, 2012 (restated) | $ | (1,479 | ) | $ | (6,537 | ) | $ | (1,461 | ) | $ | (9,477 | ) | |||||
Goodwill written off | — | (423 | ) | — | (423 | ) | |||||||||||
Accumulated write-offs as of September 30, 2013 | $ | (1,479 | ) | $ | (6,960 | ) | $ | (1,461 | ) | $ | (9,900 | ) | |||||
Goodwill | ' | ||||||||||||||||
The gross carrying amount of goodwill and other intangible assets and the related accumulated amortization for intangible assets subject to amortization and accumulated write-offs of goodwill as of September 30, 2013 and December 31, 2012 is as follows: | |||||||||||||||||
As of | |||||||||||||||||
September 30, 2013 | December 31, 2012 | ||||||||||||||||
Gross Carrying | Accumulated | Gross Carrying | Accumulated | ||||||||||||||
Amortization/ | Amortization/ | ||||||||||||||||
(in millions) | Amount | Write-offs | Amount | Write-offs | |||||||||||||
Amortizable intangible assets | |||||||||||||||||
Technology-related | $ | 8,118 | $ | (3,254 | ) | $ | 8,020 | $ | (3,005 | ) | |||||||
Patents | 504 | (322 | ) | 559 | (352 | ) | |||||||||||
Other intangible assets | 815 | (465 | ) | 810 | (428 | ) | |||||||||||
$ | 9,437 | $ | (4,041 | ) | $ | 9,389 | $ | (3,785 | ) | ||||||||
Unamortizable intangible assets | |||||||||||||||||
Goodwill | $ | 15,453 | $ | (9,900 | ) | $ | 15,450 | $ | (9,477 | ) | |||||||
Technology-related | 197 | — | 242 | — | |||||||||||||
$ | 15,650 | $ | (9,900 | ) | $ | 15,692 | $ | (9,477 | ) | ||||||||
Impairment of Intangible Assets [Member] | ' | ||||||||||||||||
Goodwill [Line Items] | ' | ||||||||||||||||
Description of unobservable inputs used in Level 3 fair value measurements [Table Text Block] | ' | ||||||||||||||||
In-process research and development fair value is measured using projected revenues, projected expenses, discount rates, and | |||||||||||||||||
probability of expected launch. The nonrecurring Level 3 fair value measurements of the impairment analysis performed in the second quarter of 2013 included the following significant unobservable inputs: | |||||||||||||||||
Intangible Asset | Valuation Date | Fair Value | Valuation Technique | Unobservable Input | Rate | ||||||||||||
In-Process R&D | 30-Jun-13 | $178 million | Income Approach - Excess Earnings Method | Discount Rate | 16.50% |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | |||||||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||||||
Fair Value Measurements (Tables) [Abstract] | ' | |||||||||||||||||||||||||||||||
Net foreign currency gain (loss) [Table Text Block] | ' | |||||||||||||||||||||||||||||||
Net gains and losses on currency hedge contracts not designated as hedging instruments were offset by net losses and gains from foreign currency transaction exposures, as shown in the following table: | ||||||||||||||||||||||||||||||||
(in millions) | Location in Statement of Operations | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||||||||
Gain (loss) on currency hedge contracts | Other, net | $ | 12 | $ | (14 | ) | $ | 66 | $ | — | ||||||||||||||||||||||
Gain (loss) on foreign currency transaction exposures | Other, net | (15 | ) | 11 | (72 | ) | (13 | ) | ||||||||||||||||||||||||
Net foreign currency gain (loss) | Other, net | $ | (3 | ) | $ | (3 | ) | $ | (6 | ) | $ | (13 | ) | |||||||||||||||||||
Gains (losses) recognized in earnings for derivatives designed as hedging instruments | ' | |||||||||||||||||||||||||||||||
The following presents the effect of our derivative instruments designated as cash flow hedges under Topic 815 on our accompanying unaudited condensed consolidated statements of operations during the third quarter and first nine months of 2013 and 2012 (in millions): | ||||||||||||||||||||||||||||||||
Amount of Pre-tax | Amount of Pre-tax Gain (Loss) Reclassified from AOCI into Earnings | Location in Statement of | ||||||||||||||||||||||||||||||
Gain (Loss) | (Effective Portion) | Operations | ||||||||||||||||||||||||||||||
Recognized in OCI | ||||||||||||||||||||||||||||||||
(Effective Portion) | ||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | (45 | ) | $ | 15 | Cost of products sold | ||||||||||||||||||||||||||
$ | (45 | ) | $ | 15 | ||||||||||||||||||||||||||||
Three Months Ended September 30, 2012 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | (44 | ) | $ | (3 | ) | Cost of products sold | |||||||||||||||||||||||||
$ | (44 | ) | $ | (3 | ) | |||||||||||||||||||||||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | 144 | $ | 15 | Cost of products sold | |||||||||||||||||||||||||||
$ | 144 | $ | 15 | |||||||||||||||||||||||||||||
Nine Months Ended September 30, 2012 | ||||||||||||||||||||||||||||||||
Currency hedge contracts | $ | 2 | $ | (29 | ) | Cost of products sold | ||||||||||||||||||||||||||
$ | 2 | $ | (29 | ) | ||||||||||||||||||||||||||||
Gains (losses) recognized in earnings for derivatives not designated as hedging instruments | ' | |||||||||||||||||||||||||||||||
The amount of gain (loss) recognized in earnings related to the ineffective portion of hedging relationships was de minimis for all periods presented. | ||||||||||||||||||||||||||||||||
Classification of derivative assets and liabilities within level 2 | ' | |||||||||||||||||||||||||||||||
The following are the balances of our derivative assets and liabilities as of September 30, 2013 and December 31, 2012: | ||||||||||||||||||||||||||||||||
As of | ||||||||||||||||||||||||||||||||
(in millions) | Location in Balance Sheet (1) | 30-Sep-13 | 31-Dec-12 | |||||||||||||||||||||||||||||
Derivative Assets: | ||||||||||||||||||||||||||||||||
Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Prepaid and other current assets | $ | 88 | $ | 25 | |||||||||||||||||||||||||||
Currency hedge contracts | Other long-term assets | 95 | 63 | |||||||||||||||||||||||||||||
183 | 88 | |||||||||||||||||||||||||||||||
Non-Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Prepaid and other current assets | 17 | 33 | |||||||||||||||||||||||||||||
Total Derivative Assets | $ | 200 | $ | 121 | ||||||||||||||||||||||||||||
Derivative Liabilities: | ||||||||||||||||||||||||||||||||
Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Other current liabilities | $ | 8 | $ | 20 | |||||||||||||||||||||||||||
Currency hedge contracts | Other long-term liabilities | 9 | 10 | |||||||||||||||||||||||||||||
17 | 30 | |||||||||||||||||||||||||||||||
Non-Designated Hedging Instruments | ||||||||||||||||||||||||||||||||
Currency hedge contracts | Other current liabilities | 27 | 27 | |||||||||||||||||||||||||||||
Total Derivative Liabilities | $ | 44 | $ | 57 | ||||||||||||||||||||||||||||
-1 | We classify derivative assets and liabilities as current when the remaining term of the derivative contract is one year or less. | |||||||||||||||||||||||||||||||
Assets and liabilities measured at fair value on a recurring basis | ' | |||||||||||||||||||||||||||||||
Assets and liabilities measured at fair value on a recurring basis consist of the following as of September 30, 2013 and December 31, 2012: | ||||||||||||||||||||||||||||||||
As of September 30, 2013 | As of December 31, 2012 | |||||||||||||||||||||||||||||||
(in millions) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Money market and government funds | $ | 155 | — | — | $ | 155 | $ | 39 | — | — | $ | 39 | ||||||||||||||||||||
Currency hedge contracts | — | $ | 200 | — | 200 | — | $ | 121 | — | 121 | ||||||||||||||||||||||
$ | 155 | $ | 200 | — | $ | 355 | $ | 39 | $ | 121 | — | $ | 160 | |||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||
Currency hedge contracts | — | $ | 44 | — | $ | 44 | — | $ | 57 | — | $ | 57 | ||||||||||||||||||||
Accrued contingent consideration | — | — | $ | 536 | 536 | — | — | $ | 663 | 663 | ||||||||||||||||||||||
— | $ | 44 | $ | 536 | $ | 580 | — | $ | 57 | $ | 663 | $ | 720 | |||||||||||||||||||
Borrowings_and_Credit_Arrangem1
Borrowings and Credit Arrangements (Tables) | 9 Months Ended | ||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||
Borrowings and Credit Arrangements (Tables) [Abstract] | ' | ||||||||||||||||||||||||||
Schedule of debt maturities | ' | ||||||||||||||||||||||||||
The debt maturity schedule for the significant components of our debt obligations as of September 30, 2013 is as follows: | |||||||||||||||||||||||||||
(in millions) | 2013 | 2014 | 2015 | 2016 | 2017 | Thereafter | Total | ||||||||||||||||||||
Senior notes | — | $ | — | $ | 400 | $ | 600 | $ | 250 | $ | 2,550 | $ | 3,800 | ||||||||||||||
Term loan | — | $ | — | $ | — | $ | 80 | $ | 80 | $ | 240 | $ | 400 | ||||||||||||||
— | $ | — | $ | 400 | $ | 680 | $ | 330 | $ | 2,790 | $ | 4,200 | |||||||||||||||
Note: | The table above does not include unamortized discounts associated with our senior notes, or amounts related to interest rate contracts used to hedge the fair value of certain of our senior notes. | ||||||||||||||||||||||||||
Summary of revolving credit facility agreement compliance with debt covenants | ' | ||||||||||||||||||||||||||
Our revolving credit facility agreement in place as of September 30, 2013 requires that we maintain certain financial covenants, as follows: | |||||||||||||||||||||||||||
Covenant | Actual as of | ||||||||||||||||||||||||||
Requirement | 30-Sep-13 | ||||||||||||||||||||||||||
Maximum leverage ratio (1) | 3.5 times | 2.4 times | |||||||||||||||||||||||||
Minimum interest coverage ratio (2) | 3.0 times | 5.4 times | |||||||||||||||||||||||||
-1 | Ratio of total debt to consolidated EBITDA, as defined by the credit agreement, for the preceding four consecutive fiscal quarters. | ||||||||||||||||||||||||||
-2 | Ratio of consolidated EBITDA, as defined by the credit agreement, to interest expense for the preceding four consecutive fiscal quarters. |
Restructuring_Related_Activiti1
Restructuring Related Activities (Tables) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Restructuring and Related Cost [Line Items] | ' | |||||||||||||||||||||||
Impact of restructuring costs on the accompanying financial statements | ' | |||||||||||||||||||||||
The following presents these costs (credits) by major type and line item within our accompanying unaudited condensed consolidated statements of operations, as well as by program: | ||||||||||||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 5 | $ | — | $ | — | $ | — | $ | 14 | $ | 19 | ||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | — | — | — | — | ||||||||||||||||||
Selling, general and administrative expenses | — | 1 | — | — | 6 | 7 | ||||||||||||||||||
— | 1 | — | — | 6 | 7 | |||||||||||||||||||
$ | 5 | $ | 1 | $ | — | $ | — | $ | 20 | $ | 26 | |||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 5 | $ | 1 | $ | — | $ | — | $ | 20 | $ | 26 | ||||||||||||
2010 Restructuring plan | — | — | — | — | — | — | ||||||||||||||||||
Plant Network Optimization program | — | — | — | — | — | — | ||||||||||||||||||
$ | 5 | $ | 1 | $ | — | $ | — | $ | 20 | $ | 26 | |||||||||||||
Three Months Ended September 30, 2012 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 44 | $ | — | $ | — | $ | — | $ | 10 | $ | 54 | ||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | 1 | — | — | 1 | ||||||||||||||||||
Selling, general and administrative expenses | — | — | — | — | 3 | 3 | ||||||||||||||||||
— | — | 1 | — | 3 | 4 | |||||||||||||||||||
$ | 44 | $ | — | $ | 1 | $ | — | $ | 13 | $ | 58 | |||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 43 | $ | — | $ | — | $ | — | $ | 13 | $ | 56 | ||||||||||||
2010 Restructuring plan | 2 | — | — | — | — | 2 | ||||||||||||||||||
Plant Network Optimization program | (1 | ) | — | 1 | — | — | — | |||||||||||||||||
$ | 44 | $ | — | $ | 1 | $ | — | $ | 13 | $ | 58 | |||||||||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 26 | $ | — | $ | — | $ | (16 | ) | $ | 45 | $ | 55 | |||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | — | — | — | — | ||||||||||||||||||
Selling, general and administrative expenses | — | 2 | — | — | 14 | 16 | ||||||||||||||||||
— | 2 | — | — | 14 | 16 | |||||||||||||||||||
$ | 26 | $ | 2 | $ | — | $ | (16 | ) | $ | 59 | $ | 71 | ||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 30 | $ | 2 | $ | — | $ | (16 | ) | $ | 59 | $ | 75 | |||||||||||
2010 Restructuring plan | — | — | — | — | — | — | ||||||||||||||||||
Plant Network Optimization program | (4 | ) | — | — | — | — | (4 | ) | ||||||||||||||||
$ | 26 | $ | 2 | $ | — | $ | (16 | ) | $ | 59 | $ | 71 | ||||||||||||
Nine Months Ended September 30, 2012 | ||||||||||||||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
Restructuring charges | $ | 64 | $ | — | $ | — | $ | — | $ | 29 | $ | 93 | ||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Cost of products sold | — | — | 7 | — | — | 7 | ||||||||||||||||||
Selling, general and administrative expenses | — | — | — | — | 8 | 8 | ||||||||||||||||||
— | — | 7 | — | 8 | 15 | |||||||||||||||||||
$ | 64 | $ | — | $ | 7 | $ | — | $ | 37 | $ | 108 | |||||||||||||
(in millions) | Termination | Accelerated | Transfer | Fixed Asset | Other | Total | ||||||||||||||||||
Benefits | Depreciation | Costs | Write-offs | |||||||||||||||||||||
2011 Restructuring plan | $ | 65 | $ | — | $ | — | $ | — | $ | 34 | $ | 99 | ||||||||||||
2010 Restructuring plan | — | — | — | — | 3 | 3 | ||||||||||||||||||
Plant Network Optimization program | (1 | ) | — | 7 | — | — | 6 | |||||||||||||||||
$ | 64 | $ | — | $ | 7 | $ | — | $ | 37 | $ | 108 | |||||||||||||
Cumulative restructuring charges | ' | |||||||||||||||||||||||
The following presents these costs by major type and by plan: | ||||||||||||||||||||||||
(in millions) | 2011 | 2010 | Plant | Total | ||||||||||||||||||||
Restructuring | Restructuring | Network | ||||||||||||||||||||||
plan (including the Expansion) | plan | Optimization Program | ||||||||||||||||||||||
Termination benefits | $ | 130 | $ | 90 | $ | 31 | $ | 251 | ||||||||||||||||
Fixed asset write-offs | — | 11 | — | 11 | ||||||||||||||||||||
Other | 98 | 51 | — | 149 | ||||||||||||||||||||
Total restructuring charges | 228 | 152 | 31 | 411 | ||||||||||||||||||||
Accelerated depreciation | — | — | 22 | 22 | ||||||||||||||||||||
Transfer costs | — | — | 74 | 74 | ||||||||||||||||||||
Other | 32 | 8 | — | 40 | ||||||||||||||||||||
Restructuring-related expenses | 32 | 8 | 96 | 136 | ||||||||||||||||||||
$ | 260 | $ | 160 | $ | 127 | $ | 547 | |||||||||||||||||
Cash payments associated with restructuring initiatives | ' | |||||||||||||||||||||||
Payments were made using cash generated from operations, and are comprised of the following: | ||||||||||||||||||||||||
(in millions) | 2011 | 2010 | Plant | Total | ||||||||||||||||||||
Restructuring | Restructuring | Network | ||||||||||||||||||||||
plan (including the Expansion) | plan | Optimization Program | ||||||||||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||||||||||||
Termination benefits | $ | 16 | $ | — | $ | — | $ | 16 | ||||||||||||||||
Transfer costs | — | — | — | — | ||||||||||||||||||||
Other | 20 | — | — | 20 | ||||||||||||||||||||
$ | 36 | $ | — | $ | — | $ | 36 | |||||||||||||||||
Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||
Termination benefits | $ | 49 | $ | — | $ | 1 | $ | 50 | ||||||||||||||||
Transfer costs | — | — | — | — | ||||||||||||||||||||
Other | 57 | — | — | 57 | ||||||||||||||||||||
$ | 106 | $ | — | $ | 1 | $ | 107 | |||||||||||||||||
Program to Date | ||||||||||||||||||||||||
Termination benefits | $ | 113 | $ | 90 | $ | 30 | $ | 233 | ||||||||||||||||
Transfer costs | — | — | 73 | 73 | ||||||||||||||||||||
Other | 122 | 55 | — | 177 | ||||||||||||||||||||
$ | 235 | $ | 145 | $ | 103 | $ | 483 | |||||||||||||||||
Summary of accrued expenses within accompanying unaudited condensed consolidated balance sheets | ' | |||||||||||||||||||||||
The following is a rollforward of the termination benefit liability associated with our 2011 Restructuring plan (including the Expansion), 2010 Restructuring plan and Plant Network Optimization program, since the inception of the respective plans, which is reported as a component of accrued expenses included in our accompanying unaudited condensed balance sheets: | ||||||||||||||||||||||||
Restructuring Plan Termination Benefits | ||||||||||||||||||||||||
(in millions) | 2011 | 2010 | Plant Network Optimization | Total | ||||||||||||||||||||
Accrued as of December 31, 2012 | $ | 36 | $ | 3 | $ | 9 | 48 | |||||||||||||||||
Charges (credits) | 30 | — | (4 | ) | 26 | |||||||||||||||||||
Cash payments | (49 | ) | — | (1 | ) | (50 | ) | |||||||||||||||||
Other adjustments | — | (3 | ) | — | (3 | ) | ||||||||||||||||||
Accrued as of September 30, 2013 | $ | 17 | $ | — | $ | 4 | $ | 21 | ||||||||||||||||
2014 Restructuring plan [Member] | ' | |||||||||||||||||||||||
Restructuring and Related Cost [Line Items] | ' | |||||||||||||||||||||||
Impact of restructuring costs on the accompanying financial statements | ' | |||||||||||||||||||||||
We estimate that the implementation of the 2014 Restructuring plan will result in total pre-tax charges of approximately $175 million to $225 million, of which approximately $160 million to $210 million is expected to result in future cash outlays. The following table provides a summary of our estimates of costs associated with the 2014 Restructuring plan by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total estimated amount expected to | |||||||||||||||||||||||
be incurred | ||||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $120 million to $150 million | |||||||||||||||||||||||
Other (1) | $5 million to $15 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Other (2) | $50 million to $60 million | |||||||||||||||||||||||
$175 million to $225 million | ||||||||||||||||||||||||
(1) Consists primarily of consultant fees and costs associated with contractual cancellations. | ||||||||||||||||||||||||
(2) Comprised of other costs directly related to the 2014 Restructuring plan, including program management, accelerated depreciation, and costs to transfer product lines among facilities. | ||||||||||||||||||||||||
2011 Restructuring Plan [Member] | ' | |||||||||||||||||||||||
Restructuring and Related Cost [Line Items] | ' | |||||||||||||||||||||||
Impact of restructuring costs on the accompanying financial statements | ' | |||||||||||||||||||||||
The following provides a summary of our expected total costs associated with the 2011 Restructuring plan, including the Expansion, by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total estimated amount expected to | |||||||||||||||||||||||
be incurred | ||||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $160 million to $185 million | |||||||||||||||||||||||
Other (1) | $100 million to $120 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Other (2) | $40 million to $50 million | |||||||||||||||||||||||
$300 million to $355 million | ||||||||||||||||||||||||
-1 | Includes primarily consulting fees, gains and losses on disposals of fixed assets and costs associated with contractual cancellations. | |||||||||||||||||||||||
-2 | Comprised of other costs directly related to the 2011 Restructuring plan, including the Expansion, such as program management, accelerated depreciation, retention and infrastructure-related costs. | |||||||||||||||||||||||
2010 Restructuring Plan [Member] | ' | |||||||||||||||||||||||
Restructuring and Related Cost [Line Items] | ' | |||||||||||||||||||||||
Impact of restructuring costs on the accompanying financial statements | ' | |||||||||||||||||||||||
The following provides a summary of our costs associated with the 2010 Restructuring plan by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total amount incurred | |||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $90 million | |||||||||||||||||||||||
Fixed asset write-offs | $11 million | |||||||||||||||||||||||
Other (1) | $51 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Other (2) | $8 million | |||||||||||||||||||||||
$160 million | ||||||||||||||||||||||||
-1 | Includes primarily consulting fees and costs associated with contractual cancellations. | |||||||||||||||||||||||
-2 | Comprised of other costs directly related to the 2010 Restructuring plan, including accelerated depreciation and infrastructure-related costs. | |||||||||||||||||||||||
Plant Network Optimization [Member] | ' | |||||||||||||||||||||||
Restructuring and Related Cost [Line Items] | ' | |||||||||||||||||||||||
Impact of restructuring costs on the accompanying financial statements | ' | |||||||||||||||||||||||
The following provides a summary of our estimates of costs associated with the Plant Network Optimization program by major type of cost: | ||||||||||||||||||||||||
Type of cost | Total estimated amount expected to | |||||||||||||||||||||||
be incurred | ||||||||||||||||||||||||
Restructuring charges: | ||||||||||||||||||||||||
Termination benefits | $33 million | |||||||||||||||||||||||
Restructuring-related expenses: | ||||||||||||||||||||||||
Accelerated depreciation | $22 million | |||||||||||||||||||||||
Transfer costs (1) | $75 million | |||||||||||||||||||||||
$130 million | ||||||||||||||||||||||||
-1 | Consists primarily of costs to transfer product lines among facilities, including costs of transfer teams, freight, idle facility and product line validations. |
Supplemental_Balance_Sheet_Inf1
Supplemental Balance Sheet Information (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Supplemental Balance Sheet Information (Tables) [Abstract] | ' | ||||||||||||||||
Inventory Disclosure [Text Block] | ' | ||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Finished goods | $ | 592 | $ | 598 | |||||||||||||
Work-in-process | 87 | 70 | |||||||||||||||
Raw materials | 216 | 216 | |||||||||||||||
$ | 895 | $ | 884 | ||||||||||||||
Trade accounts receivable, net | ' | ||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Accounts receivable | $ | 1,360 | $ | 1,336 | |||||||||||||
Less: allowance for doubtful accounts | (85 | ) | (88 | ) | |||||||||||||
Less: allowance for sales returns | (37 | ) | (31 | ) | |||||||||||||
$ | 1,238 | $ | 1,217 | ||||||||||||||
Rollforward of allowances for doubtful accounts | ' | ||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in millions) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Beginning balance | $ | 84 | $ | 83 | $ | 88 | $ | 81 | |||||||||
Net (credits) charges to expenses | 2 | 1 | 7 | 7 | |||||||||||||
Utilization of allowances | (1 | ) | (2 | ) | (10 | ) | (6 | ) | |||||||||
Ending balance | $ | 85 | $ | 82 | $ | 85 | $ | 82 | |||||||||
Property, plant and equipment, net | ' | ||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Land | $ | 81 | $ | 81 | |||||||||||||
Buildings and improvements | 912 | 873 | |||||||||||||||
Equipment, furniture and fixtures | 2,446 | 2,348 | |||||||||||||||
Capital in progress | 177 | 218 | |||||||||||||||
3,616 | 3,520 | ||||||||||||||||
Less: accumulated depreciation | 2,086 | 1,956 | |||||||||||||||
$ | 1,530 | $ | 1,564 | ||||||||||||||
Accrued expenses | ' | ||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Payroll and related liabilities | $ | 450 | $ | 452 | |||||||||||||
Accrued contingent consideration | 170 | 120 | |||||||||||||||
Legal reserves | 159 | 100 | |||||||||||||||
Other | 567 | 612 | |||||||||||||||
$ | 1,346 | $ | 1,284 | ||||||||||||||
Other long-term liabilities | ' | ||||||||||||||||
As of | |||||||||||||||||
(in millions) | September 30, 2013 | December 31, 2012 | |||||||||||||||
Accrued income taxes | $ | 1,274 | $ | 1,215 | |||||||||||||
Accrued contingent consideration | 366 | 543 | |||||||||||||||
Legal reserves | 524 | 391 | |||||||||||||||
Other long-term liabilities | 419 | 398 | |||||||||||||||
$ | 2,583 | $ | 2,547 | ||||||||||||||
Accrued warranties | ' | ||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Beginning Balance | $ | 26 | $ | 30 | |||||||||||||
Provision | 11 | 6 | |||||||||||||||
Settlements/reversals | (9 | ) | (9 | ) | |||||||||||||
Ending Balance | $ | 28 | $ | 27 | |||||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Income Taxes (Tables) [Abstract] | ' | ||||||
Tax rate | ' | ||||||
The following tables provide a summary of our reported tax rate: | |||||||
Three Months Ended | |||||||
September 30, | |||||||
2013 | 2012 | ||||||
Reported tax rate | 87.6 | % | (0.1 | )% | |||
Impact of certain receipts/charges* | (74.5 | )% | 16.2 | % | |||
13.1 | % | 16.1 | % | ||||
Nine Months Ended | |||||||
September 30, | |||||||
2013 | 2012 | ||||||
Reported tax rate | 18.9 | % | 0.7 | % | |||
Impact of certain receipts/charges* | (5.2 | )% | 14.5 | % | |||
13.7 | % | 15.2 | % | ||||
*These receipts/charges are taxed at different rates than our effective tax rate. |
Weighted_Average_Shares_Outsta1
Weighted Average Shares Outstanding (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Earnings Per Share (Tables) [Abstract] | ' | |||||||||||||
Schedule of Weighted Average Number of Shares [Table Text Block] | ' | |||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
September 30, | September 30, | |||||||||||||
(in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Weighted average shares outstanding - basic | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 | ||||||||||
Net effect of common stock equivalents | — | * | — | ** | — | * | — | ** | ||||||
Weighted average shares outstanding - assuming dilution | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 | ||||||||||
Segment_Reporting_Tables
Segment Reporting (Tables) | 9 Months Ended | |||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||
Segment Reporting (Tables) [Abstract] | ' | |||||||||||||||||
Segment Reporting Information By Segment | ' | |||||||||||||||||
A reconciliation of the totals reported for the reportable segments to the applicable line items in our accompanying unaudited condensed consolidated statements of operations is as follows: | ||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
(in millions) | 2013 | 2012* | 2013 | 2012* | ||||||||||||||
Net sales | ||||||||||||||||||
Interventional Cardiology | $ | 487 | $ | 496 | $ | 1,538 | $ | 1,646 | ||||||||||
Peripheral Interventions | 202 | 188 | 601 | 571 | ||||||||||||||
Cardiovascular | 689 | 684 | 2,139 | 2,217 | ||||||||||||||
Cardiac Rhythm Management | 474 | 467 | 1,445 | 1,466 | ||||||||||||||
Electrophysiology | 35 | 35 | 106 | 109 | ||||||||||||||
Rhythm Management | 509 | 502 | 1,551 | 1,575 | ||||||||||||||
Endoscopy | 331 | 308 | 979 | 916 | ||||||||||||||
Urology/Women's Health | 134 | 124 | 378 | 367 | ||||||||||||||
Neuromodulation | 116 | 88 | 316 | 263 | ||||||||||||||
MedSurg | 581 | 520 | 1,673 | 1,546 | ||||||||||||||
Net sales allocated to reportable segments | 1,779 | 1,706 | 5,363 | 5,338 | ||||||||||||||
Sales generated from divested businesses | 2 | 32 | 56 | 91 | ||||||||||||||
Impact of foreign currency fluctuations | (46 | ) | (3 | ) | (114 | ) | (1 | ) | ||||||||||
$ | 1,735 | $ | 1,735 | $ | 5,305 | $ | 5,428 | |||||||||||
Income (loss) before income taxes | ||||||||||||||||||
Cardiovascular | $ | 184 | $ | 175 | $ | 548 | $ | 561 | ||||||||||
Rhythm Management | 68 | 58 | 192 | 218 | ||||||||||||||
MedSurg | 187 | 169 | 521 | 452 | ||||||||||||||
Operating income allocated to reportable segments | 439 | 402 | 1,261 | 1,231 | ||||||||||||||
Corporate expenses and currency exchange | (103 | ) | (58 | ) | (251 | ) | (214 | ) | ||||||||||
Goodwill and other intangible asset impairment charges; and acquisition-, divestiture-, restructuring-, and litigation related charges and credits | (132 | ) | (839 | ) | (711 | ) | (4,708 | ) | ||||||||||
Amortization expense | (101 | ) | (99 | ) | (305 | ) | (294 | ) | ||||||||||
Operating (loss) income | 103 | (594 | ) | (6 | ) | (3,985 | ) | |||||||||||
Other expense, net | (143 | ) | (69 | ) | (276 | ) | (174 | ) | ||||||||||
Income (loss) before income taxes | $ | (40 | ) | $ | (663 | ) | $ | (282 | ) | $ | (4,159 | ) | ||||||
* We have restated prior year detail to conform to current year presentation. |
Changes_in_Other_Comprehensive1
Changes in Other Comprehensive Income (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Changes in Other Comprehensive Income [Abstract] | ' | ||||
Changes in Other Comprehensive Income [Table Text Block] | ' | ||||
Three Months Ended September 30, 2013 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($28) | $153 | ($41) | $84 | |
Other comprehensive income (loss) before reclassifications | 10 | -29 | — | -19 | |
Amounts reclassified from accumulated other comprehensive income | — | -9 | — | -9 | |
Net current-period other comprehensive income | 10 | -38 | — | -28 | |
Ending Balance | ($18) | $115 | ($41) | $56 | |
Three Months Ended September 30, 2012 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($51) | ($4) | ($32) | ($87) | |
Other comprehensive income (loss) before reclassifications | 2 | -29 | — | -27 | |
Amounts reclassified from accumulated other comprehensive income | — | 2 | — | 2 | |
Net current-period other comprehensive income | 2 | -27 | — | -25 | |
Ending Balance | ($49) | ($31) | ($32) | ($112) | |
Nine Months Ended September 30, 2013 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($26) | $34 | ($41) | ($33) | |
Other comprehensive income (loss) before reclassifications | 8 | 91 | — | 99 | |
Amounts reclassified from accumulated other comprehensive income | — | -10 | — | -10 | |
Net current-period other comprehensive income | 8 | 81 | — | 89 | |
Ending Balance | ($18) | $115 | ($41) | $56 | |
Nine Months Ended September 30, 2012 | |||||
(in millions) | Foreign currency translation adjustments | Unrealized gains/losses on derivative financial instruments | Defined benefit pension items / Other | Total | |
Beginning Balance | ($58) | ($48) | ($32) | ($138) | |
Other comprehensive income (loss) before reclassifications | 9 | — | — | 9 | |
Amounts reclassified from accumulated other comprehensive income | — | 17 | — | 17 | |
Net current-period other comprehensive income | 9 | 17 | — | 26 | |
Ending Balance | ($49) | ($31) | ($32) | ($112) |
Acquisitions_Details
Acquisitions (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | ||||||||||||||||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jun. 08, 2012 | Jun. 30, 2012 | Sep. 30, 2013 | Jun. 08, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
reportablesegments | twenty twelve acquisitions [Domain] | twenty twelve acquisitions [Domain] | twenty twelve acquisitions [Domain] | R&D- and commercialization-based milestones [Member] | R&D- and commercialization-based milestones [Member] | R&D- and commercialization-based milestones [Member] | Technology-related [Member] | Customer Contracts [Member] | Purchased research and development [Member] | Discounted cash flow [Member] | Discounted cash flow [Member] | Discounted cash flow [Member] | Monte Carlo [Member] | Monte Carlo [Member] | Monte Carlo [Member] | Monte Carlo [Member] | Monte Carlo [Member] | ||||||
Minimum [Member] | Maximum [Member] | twenty twelve acquisitions [Domain] | twenty twelve acquisitions [Domain] | twenty twelve acquisitions [Domain] | revenue-based payments [Member] | revenue-based payments [Member] | revenue-based payments [Member] | revenue-based payments [Member] | revenue-based payments [Member] | revenue-based payments [Member] | revenue-based payments [Member] | revenue-based payments [Member] | |||||||||||
Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Low end of range [Member] | High end of range [Member] | ||||||||||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Potential payment due upon closing of Bard acquisition | $275 | ' | $275 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
InProcessResearchandDevelopmentReclassified | ' | 47 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Reportable Segments | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Note Receivable | ' | ' | ' | ' | ' | ' | ' | ' | 40 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Goodwill Amount | ' | ' | ' | ' | ' | ' | ' | 314 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | 23 | -20 | 18 | -9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Cash Paid | ' | ' | ' | ' | ' | ' | ' | ' | 134 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum future contingent consideration for acquisitions completed after January 1, 2009 | 2,179 | ' | 2,179 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Benefit related to change in fair value of contingent liability | ' | ' | 18 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent payment related to business combination | 100 | ' | 115 | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of contingent consideration | ' | ' | ' | ' | ' | ' | ' | ' | -259 | -126 | ' | ' | ' | ' | ' | -144 | ' | ' | -266 | ' | ' | ' | ' |
Revenue Volatility - Contingent Consideration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13.00% | 28.00% |
contingent consideration liability, projected year of payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2013 | '2014 | ' | ' | ' | ' | '2013 | '2018 | ' | '2013 | '2018 | ' | ' |
contingent consideration liability, probability of payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 70.00% | 98.00% | ' | ' | ' | ' | 15.00% | 100.00% | ' | ' | ' | ' | ' |
Risk-adjusted discount rate for contingent consideration | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.80% | 1.10% | ' | ' | ' | ' | 12.00% | 18.00% | ' | ' | ' | ' | ' |
Accrued Contingent Consideration | -536 | ' | -536 | ' | -663 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Combination, Liabilities Arising from Contingencies, Amount Recognized | ' | ' | -6 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Equity Interests Issued and Issuable | ' | ' | ' | ' | ' | ' | ' | ' | 79 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Combination, Step Acquisition, Equity Interest in Acquiree, Remeasurement Gain | ' | ' | ' | ' | ' | ' | 39 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Notes Payable and Long-term Debt | ' | ' | ' | ' | ' | ' | ' | ' | 9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Cost of Acquired Entity, Purchase Price | ' | ' | ' | ' | ' | ' | ' | 481 | 481 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Amortizable Intangible Assets | ' | ' | ' | ' | ' | ' | ' | 42 | ' | ' | ' | ' | 40 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Intangible Assets Not Amortizable | ' | ' | ' | ' | ' | ' | ' | 48 | ' | ' | ' | ' | ' | ' | 48 | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Other Noncurrent Assets | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition, Purchase Price Allocation, Deferred Taxes Asset (Liability), Net, Noncurrent | ' | ' | ' | ' | ' | ' | ' | 76 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '11 years | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Range Of Risk Adjusted Discount Rates Used In Purchase Price Allocation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14.00% | 14.00% | 14.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangibles | ' | ' | ' | ' | ' | ' | ' | 90 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Initial cash payment for Cameron acquisition | ' | ' | ' | ' | ' | 150 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Potential payment due upon FDA approval of S-ICD system | ' | ' | ' | ' | 150 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum potential payment due upon achievement of certain milestones, per Cameron agreement | $1,050 | ' | $1,050 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Divestitures_Details
Divestitures (Details) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Jan. 31, 2011 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Divestitures (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Purchase price for divestiture of business/controlling interest | $1,500 | ' | ' | ' | ' | ' | ' |
Proceeds from divestiture of business, excluding amounts placed in escrow | 1,450 | ' | ' | ' | ' | ' | ' |
Contingent receivable for divestiture of business | ' | 10 | ' | ' | 10 | ' | ' |
Revenues generated by the Neurovascular business | ' | 2 | ' | 32 | 56 | 91 | ' |
Proceeds from Divestiture of Businesses | ' | ' | $30 | ' | $30 | $10 | $10 |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2012 | Jun. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
reportablesegments | ||||||||
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets reclassified from unamortizable to amortizable | $45 | ' | ' | ' | ' | ' | ' | ' |
In process research and development associated with Sadra | ' | 178 | ' | ' | ' | ' | ' | ' |
Goodwill | 5,553 | ' | ' | ' | ' | 5,553 | ' | 5,973 |
Goodwill, Impaired, Accumulated Impairment Loss | -9,900 | ' | ' | ' | ' | -9,900 | ' | -9,477 |
Goodwill | ' | ' | ' | ' | ' | ' | ' | 1,764 |
Goodwill, Purchase Accounting Adjustments | ' | ' | ' | ' | ' | 3 | ' | ' |
Goodwill, Acquired During Period | ' | ' | ' | ' | ' | 0 | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -4,041 | ' | ' | ' | ' | -4,041 | ' | -3,785 |
Indefinite-lived intangible assets, including goodwill | 15,650 | ' | ' | ' | ' | 15,650 | ' | 15,692 |
Finite-Lived Intangible Assets, Gross | 9,437 | ' | ' | ' | ' | 9,437 | ' | 9,389 |
Indefinite-lived intangible assets, accumulated write-offs | -9,900 | ' | ' | ' | ' | -9,900 | ' | -9,477 |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill impairment charge | 0 | ' | 423 | 748 | 3,602 | 423 | 4,350 | ' |
Intangible Assets, Net (Excluding Goodwill) | 5,936 | ' | ' | ' | ' | 5,936 | ' | 6,289 |
Goodwill, Impairment Loss, Net of Subsequent Adjustment | ' | ' | ' | ' | ' | ' | ' | 2,380 |
Number of Reportable Segments | ' | ' | ' | ' | ' | 3 | ' | ' |
Intangible asset impairment charges | 0 | 53 | ' | 13 | ' | 53 | 142 | ' |
Goodwill, Impairment Loss, Net of Tax | ' | ' | 421 | ' | 3,579 | ' | ' | ' |
Discount rate used for measurement of fair value of Sadra IPRD asset | ' | 16.50% | ' | ' | ' | ' | ' | ' |
Fair Value Inputs, Long-term Revenue Growth Rate | ' | ' | ' | 25.00% | ' | ' | ' | ' |
Global CRM Reporting Unit [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Terminal value growth rate | ' | ' | 2.00% | ' | ' | ' | ' | ' |
Fair Value Inputs, Discount Rate | ' | ' | 12.00% | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Net | ' | ' | ' | ' | ' | ' | ' | 4,636 |
Neuromodulation [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Level of excess fair value over carrying value for reporting unit | ' | ' | ' | ' | 16.00% | ' | ' | ' |
Hypothetical change in WACC | ' | 0.80% | ' | ' | ' | ' | ' | ' |
Hypothetical change in revenue growth rates | ' | 2.00% | ' | ' | ' | ' | ' | ' |
Cardiovascular [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 3,252 | ' | ' | ' | ' | 3,252 | ' | 3,249 |
Goodwill, Impaired, Accumulated Impairment Loss | -1,479 | ' | ' | ' | ' | -1,479 | ' | -1,479 |
Goodwill, Purchase Accounting Adjustments | ' | ' | ' | ' | ' | 3 | ' | ' |
Goodwill, Acquired During Period | ' | ' | ' | ' | ' | 0 | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill impairment charge | ' | ' | ' | ' | ' | 0 | ' | ' |
Global Neuromodulation (NM) Reporting Unit [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Allocated Goodwill | ' | 1,356 | ' | ' | ' | ' | ' | ' |
Rhythm Management [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 154 | ' | ' | ' | ' | 154 | ' | 577 |
Goodwill, Impaired, Accumulated Impairment Loss | -6,960 | ' | ' | ' | ' | -6,960 | ' | -6,537 |
Goodwill, Purchase Accounting Adjustments | ' | ' | ' | ' | ' | 0 | ' | ' |
Goodwill, Acquired During Period | ' | ' | ' | ' | ' | 0 | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill impairment charge | ' | ' | ' | ' | ' | 423 | ' | ' |
MedSurg [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 2,147 | ' | ' | ' | ' | 2,147 | ' | 2,147 |
Goodwill, Impaired, Accumulated Impairment Loss | -1,461 | ' | ' | ' | ' | -1,461 | ' | -1,461 |
Goodwill, Purchase Accounting Adjustments | ' | ' | ' | ' | ' | 0 | ' | ' |
Goodwill, Acquired During Period | ' | ' | ' | ' | ' | 0 | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill impairment charge | ' | ' | ' | ' | ' | 0 | ' | ' |
Unclassified Indefinite-lived Intangible Assets [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill, Impaired, Accumulated Impairment Loss | -9,900 | ' | ' | ' | ' | -9,900 | ' | -9,477 |
Goodwill, Gross | 15,453 | ' | ' | ' | ' | 15,453 | ' | 15,450 |
Purchased research and development [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 343 | ' | ' | ' | ' | 343 | ' | 443 |
Technology-related [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 197 | ' | ' | ' | ' | 197 | ' | 242 |
Technology Developed [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Net | 4,442 | ' | ' | ' | ' | 4,442 | ' | ' |
Technology-related [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -3,254 | ' | ' | ' | ' | -3,254 | ' | -3,005 |
Finite-Lived Intangible Assets, Gross | 8,118 | ' | ' | ' | ' | 8,118 | ' | 8,020 |
Other Intangible Assets [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -465 | ' | ' | ' | ' | -465 | ' | -428 |
Finite-Lived Intangible Assets, Gross | 815 | ' | ' | ' | ' | 815 | ' | 810 |
Patents [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -322 | ' | ' | ' | ' | -322 | ' | -352 |
Finite-Lived Intangible Assets, Gross | 504 | ' | ' | ' | ' | 504 | ' | 559 |
EMEA [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Change in WACC | ' | ' | ' | ' | 1.00% | ' | ' | ' |
Sadra Medical Inc [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible asset impairment charges | ' | 51 | ' | ' | 129 | ' | ' | ' |
2011 Acquisitions, excluding Sadra [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible asset impairment charges | ' | $2 | ' | ' | ' | ' | ' | ' |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details in Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2012 | Jun. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible asset impairment charges | $0 | $53 | ' | $13 | ' | $53 | $142 | ' |
Goodwill impairment charges | 0 | ' | 423 | 748 | 3,602 | 423 | 4,350 | ' |
Unamortized losses on senior notes | 3 | ' | ' | ' | ' | 3 | ' | 3 |
Unrealized gain on interest rate cash flow hedges, pretax, AOCI | 3 | ' | ' | ' | ' | 3 | ' | 4 |
reduction of interest expense, related to amortization of previously terminated interest rate contracts | 3 | ' | ' | ' | ' | 8 | ' | ' |
Notional Amount of Foreign Currency Cash Flow Hedge Derivatives | 2,647 | ' | ' | ' | ' | 2,647 | ' | 2,469 |
Foreign Currency Cash Flow Hedge Gain (Loss) Reclassified to Earnings, Net | 15 | ' | ' | -3 | ' | 15 | -29 | ' |
Gain (Loss) in AOCI for effective portion of cash flow hedges | 113 | ' | ' | ' | ' | 113 | ' | 31 |
Foreign Currency Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months | 58 | ' | ' | ' | ' | 58 | ' | ' |
Foreign Currency Derivative Instruments Not Designated as Hedging Instruments at Fair Value, Net | 1,757 | ' | ' | ' | ' | 1,757 | ' | 1,942 |
Unamortized gains on senior notes | 56 | ' | ' | ' | ' | 56 | ' | 64 |
Interest Rate Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months, Net | 9 | ' | ' | ' | ' | 9 | ' | ' |
Time Deposits, at Carrying Value | 281 | ' | ' | ' | ' | 281 | ' | ' |
Cash | 135 | ' | ' | ' | ' | 135 | ' | 168 |
Cost-method Investments, Aggregate Carrying Amount | 22 | ' | ' | ' | ' | 22 | ' | 13 |
Other Asset Impairment Charges | 4 | ' | ' | ' | ' | ' | ' | ' |
Asset Impairment Charges | ' | ' | ' | ' | ' | 476 | ' | ' |
Debt Instrument, Fair Value Disclosure | 4,599 | ' | ' | ' | ' | 4,599 | ' | 4,793 |
Fair Value, Measurements, Recurring [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Money Market Funds, at Carrying Value | 155 | ' | ' | ' | ' | 155 | ' | 39 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Money Market Funds, at Carrying Value | $155 | ' | ' | ' | ' | $155 | ' | $39 |
Fair_Value_Measurements_Detail1
Fair Value Measurements (Details in Tables) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Other, net [Member] | Other, net [Member] | Other, net [Member] | Other, net [Member] | Cash Flow Hedging [Member] | Cash Flow Hedging [Member] | Cash Flow Hedging [Member] | Cash Flow Hedging [Member] | Cash Flow Hedging [Member] | Cash Flow Hedging [Member] | Cash Flow Hedging [Member] | Cash Flow Hedging [Member] | Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | ||
Prepaid And Other Current Assets [Member] | Prepaid And Other Current Assets [Member] | Other Long Term Assets [Member] | Other Long Term Assets [Member] | Other current liabilities [Member] | Other current liabilities [Member] | Other Long Term Liabilities [Member] | Other Long Term Liabilities [Member] | Prepaid And Other Current Assets [Member] | Prepaid And Other Current Assets [Member] | Other current liabilities [Member] | Other current liabilities [Member] | Not Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Not Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Cost of products sold [Member] | Cost of products sold [Member] | Cost of products sold [Member] | Cost of products sold [Member] | Fair Value, Inputs, Level 3 [Member] | Fair Value, Inputs, Level 3 [Member] | Fair Value, Inputs, Level 1 [Member] | Fair Value, Inputs, Level 1 [Member] | Fair Value, Inputs, Level 2 [Member] | Fair Value, Inputs, Level 2 [Member] | ||||||||
Foreign Exchange Contract [Member] | Foreign Exchange Contract [Member] | Foreign Exchange Contract [Member] | Foreign Exchange Contract [Member] | ||||||||||||||||||||||||||||||||||
Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | Designated as Hedging Instrument [Member] | ||||||||||||||||||||||||||||||||||
Derivatives Fair Value [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Money Market Funds, at Carrying Value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $155 | $39 | $0 | $0 | $155 | $39 | ' | $0 |
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12 | -14 | 66 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -45 | -44 | 144 | 2 | -45 | -44 | 144 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15 | -3 | 15 | -29 | 15 | -3 | 15 | -29 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net gain (loss) from foreign currency transaction exposures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -15 | 11 | -72 | -13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments in Hedges, Assets, at Fair Value | ' | ' | 183 | 88 | 88 | 25 | 95 | 63 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments Not Designated as Hedging Instruments, Liability, at Fair Value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 27 | 27 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Assets | 200 | 121 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments Not Designated as Hedging Instruments, Asset, at Fair Value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17 | 33 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Instruments in Hedges, Liabilities, at Fair Value | ' | ' | 17 | 30 | ' | ' | ' | ' | 8 | 20 | 9 | 10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative Liabilities | 44 | 57 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign Currency Transaction Gain (Loss), Realized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -3 | -3 | -6 | -13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign Currency Contract, Asset, Fair Value Disclosure | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200 | 121 | 0 | 0 | 0 | 0 | 200 | 121 |
Assets, Fair Value Disclosure | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 355 | 160 | 0 | 0 | 155 | 39 | 200 | 121 |
Foreign Currency Contracts, Liability, Fair Value Disclosure | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 44 | 57 | 0 | 0 | 0 | 0 | 44 | 57 |
Accrued Contingent Consideration | 536 | 663 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 536 | 663 | 536 | 663 | 0 | 0 | 0 | 0 |
Liabilities, Fair Value Disclosure | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $580 | $720 | $536 | $663 | $0 | $0 | $44 | $57 |
Borrowings_and_Credit_Arrangem2
Borrowings and Credit Arrangements (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 18 Months Ended | 3 Months Ended | ||||||||||||||||
Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2013 | Apr. 18, 2012 | Sep. 30, 2013 | Aug. 06, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Aug. 13, 2013 | Aug. 13, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
USD ($) | USD ($) | USD ($) | Covenant Requirement [Member] | Actual, Covenant [Member] | Credit Facility Two [Member] | Credit Facility Two [Member] | Revolving credit facility [Member] | Revolving credit facility [Member] | Unsecured Term Loan Facility [Member] | Unsecured Term Loan Facility [Member] | Uncommitted Credit Facilities With A Commercial Japanese Banks [Member] | Uncommitted Credit Facilities With A Commercial Japanese Banks [Member] | Uncommitted Credit Facilities With A Commercial Japanese Banks [Member] | Senior Notes [Member] | Unsecured Term Loan Facility [Member] | Italy, Spain, Portugal and Greece [Member] | $600 million, Senior Note [Member] | $450 million, Senior Note [Member] | $600 million, Snr Note [Member] | $850 million, Senior Note [Member] | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | JPY (¥) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | ||||||
Schedule of debt maturities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term Debt, Maturities, Repayments of Principal in Current Year | $0 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $0 | ' | ' | ' | ' | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Two | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' | ' | ' | ' | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Three | 400,000,000 | 400,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000,000 | 0 | ' | ' | ' | ' | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Four | 680,000,000 | 680,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 600,000,000 | 80,000,000 | ' | ' | ' | ' | ' |
Long-term Debt, Maturities, Repayments of Principal in Year Five | 330,000,000 | 330,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 250,000,000 | 80,000,000 | ' | ' | ' | ' | ' |
Long-term Debt, Maturities, Repayments of Principal After Year Five | 2,790,000,000 | 2,790,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,550,000,000 | 240,000,000 | ' | ' | ' | ' | ' |
Long-term Debt, Maturities, Total Repayments of Principal | 4,200,000,000 | 4,200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,800,000,000 | 400,000,000 | ' | ' | ' | ' | ' |
Summary of compliance with debt covenants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum Leverage Ratio | ' | ' | ' | 3.5 | 2.4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum interest coverage ratio | ' | ' | ' | 3 | 5.4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowings and Credit Arrangements (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total debt | 4,249,000,000 | 4,249,000,000 | 4,256,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest Margin above LIBOR, Minimum | ' | ' | ' | ' | ' | ' | ' | ' | 0.88% | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest Margin above LIBOR, Maximum | ' | ' | ' | ' | ' | ' | ' | ' | 1.48% | ' | 1.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Current Interest Rate | ' | ' | ' | ' | ' | ' | ' | 1.28% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitment fee percentage | ' | ' | ' | ' | ' | ' | ' | 0.23% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring charges remaining to be excluded from calculation of consolidated EBITDA | ' | ' | ' | ' | ' | ' | ' | 287,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Legal payments and debt remaining to be excluded from calculation of consolidated EBITDA | ' | ' | ' | ' | ' | ' | ' | 2,278,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Senior notes | 3,800,000,000 | 3,800,000,000 | 4,200,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 600,000,000 | 450,000,000 | ' | ' |
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.70% | 4.10% | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | ' | ' | ' | 300,000,000 | 350,000,000 | ' | 2,000,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum amount of proceeds from sale of finance receivables | 306,000,000 | 306,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 214,000,000 | 21,000,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Derecognized receivables From Sale Of Finance Receivables | 166,000,000 | 166,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
De-recognized receivables | ' | ' | 191,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 156,000,000 | ' | 182,000,000 | ' | ' | ' | ' | ' | ' | ' |
Average interest rate of de-recognized receivables | ' | 3.30% | 1.60% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average discounted rates of notes receivables | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | 2.00% | 1.60% | ' | ' | ' | ' | ' | ' | ' |
Litigation and Debt Exclusion from EBITDA | ' | ' | ' | ' | ' | ' | ' | ' | 2,300,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exclusion from EBITDA for Restructuring Charges | ' | ' | ' | ' | ' | ' | ' | ' | 500,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unsecured Term Loan Facility, Interest Rate During Period | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayments of Long-term Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term Debt, Gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayments of Long-term Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 600,000,000 | 850,000,000 |
Payments of Debt Extinguishment Costs | 70,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment of Debt Extinguishment Costs, net of tax | 44,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Letters of Credit Outstanding, Amount | 74,000,000 | 74,000,000 | 94,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts receivable 180 days past due | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 78,000,000 | ' | ' | ' | ' |
Accounts receivable 365 days past due | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $28,000,000 | ' | ' | ' | ' |
Restructuring_Related_Activiti2
Restructuring Related Activities (Details in Narrative) (USD $) | 3 Months Ended | 9 Months Ended | 53 Months Ended | 56 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 56 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 26 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||||||||||||||||||||||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
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Plant Network Optimization [Member] | Plant Network Optimization [Member] | Plant Network Optimization [Member] | Plant Network Optimization [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | Plant Network Optimization [Member] | Plant Network Optimization [Member] | Plant Network Optimization [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | Plant Network Optimization [Member] | Plant Network Optimization [Member] | Plant Network Optimization [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | Termination Benefits [Member] | Termination Benefits [Member] | Other [Member] | Accelerated depreciation [Member] | Transfer costs [Member] | Other [Member] | 2014 Restructuring plan [Member] | 2014 Restructuring plan [Member] | Plant Network Optimization [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Related To Plan [Member] | Restructuring Related To Plan [Member] | 2014 Restructuring plan [Member] | 2014 Restructuring plan [Member] | Plant Network Optimization [Member] | 2011 Restructuring Plan [Member] | 2011 Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Plan [Member] | Restructuring Related To Plan [Member] | Restructuring Related To Plan [Member] | |||||||||||||||||||||||||||||||||||||||
Plant Network Optimization [Member] | 2010 Restructuring Plan [Member] | 2010 Restructuring Plan [Member] | Plant Network Optimization [Member] | Plant Network Optimization [Member] | 2010 Restructuring Plan [Member] | Termination Benefits [Member] | Termination Benefits [Member] | Other [Member] | Other [Member] | Other [Member] | Other [Member] | Termination Benefits [Member] | Termination Benefits [Member] | Other [Member] | Other [Member] | Other [Member] | Other [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 Restructuring plan [Member] | 2011 Restructuring Plan [Member] | 2014 Restructuring plan [Member] | 2011 Restructuring Plan [Member] | 2014 Restructuring plan [Member] | 2011 Restructuring Plan [Member] | 2014 Restructuring plan [Member] | 2011 Restructuring Plan [Member] | 2014 Restructuring plan [Member] | 2011 Restructuring Plan [Member] | 2014 Restructuring plan [Member] | 2011 Restructuring Plan [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Cost [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Charges | $19 | $54 | $55 | $93 | $411 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $5 | $44 | $26 | $64 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $14 | $10 | $45 | $29 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain (Loss) on Sale of Properties | ' | ' | 19 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Reserve | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 21 | ' | 21 | ' | ' | 48 | 4 | 4 | ' | 9 | 17 | 17 | ' | 36 | 0 | 0 | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' | 10 | ' | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated costs of restructuring program by major type of cost | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected total costs associated with the plan | ' | ' | ' | ' | ' | ' | 130 | 130 | ' | ' | ' | ' | ' | ' | 160 | 160 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33 | 90 | 51 | 22 | 75 | 8 | 175 | 175 | ' | 300 | 300 | 120 | 160 | 5 | 100 | 50 | 40 | 225 | 225 | ' | 355 | 355 | 150 | 185 | 15 | 120 | 60 | 50 |
Restructuring and Related Cost, Cost Incurred to Date | ' | ' | ' | ' | 547 | ' | ' | ' | 127 | 127 | ' | ' | 260 | 260 | ' | ' | 160 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring plan estimated future cash outflow | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 145 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 160 | ' | 105 | 270 | ' | ' | ' | ' | ' | ' | ' | 210 | ' | 110 | 300 | ' | ' | ' | ' | ' | ' | ' |
Payments for Restructuring | 36 | ' | 107 | ' | 483 | 483 | 0 | 1 | 103 | 103 | 36 | 106 | 235 | 235 | 0 | 0 | 145 | 16 | ' | 50 | ' | 233 | ' | 0 | 1 | 30 | ' | 16 | 49 | 113 | ' | 0 | 0 | 90 | ' | ' | ' | ' | ' | 0 | ' | 0 | ' | 73 | 0 | 0 | 73 | 0 | 0 | 0 | 0 | 0 | 0 | 20 | ' | 57 | ' | 177 | ' | 0 | 0 | 0 | 20 | 57 | 122 | 0 | 0 | 55 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from Sale of Property, Plant, and Equipment | ' | ' | 53 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Related Expenses | $7 | $4 | $16 | $15 | $136 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $0 | $0 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1 | $0 | $2 | $0 | $0 | $1 | $0 | $7 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6 | $3 | $14 | $8 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring_Related_Activiti3
Restructuring Related Activities (Details in Tables) (USD $) | 3 Months Ended | 9 Months Ended | 53 Months Ended | 56 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 56 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 26 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 53 Months Ended | 3 Months Ended | 9 Months Ended | 23 Months Ended | 3 Months Ended | 9 Months Ended | 41 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
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Restructuring and Related Cost [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Reserve | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $21,000,000 | ' | $21,000,000 | ' | ' | $48,000,000 | $4,000,000 | ' | $4,000,000 | ' | ' | $9,000,000 | $17,000,000 | ' | $17,000,000 | ' | ' | $36,000,000 | $0 | ' | $0 | ' | ' | $3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $10,000,000 | ' | $10,000,000 | ' | ' | $5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Charges Incurred to Date | ' | ' | ' | ' | 411,000,000 | ' | ' | ' | ' | ' | 31,000,000 | ' | ' | ' | ' | ' | 228,000,000 | ' | ' | ' | ' | ' | 152,000,000 | ' | ' | ' | ' | 251,000,000 | ' | ' | ' | ' | ' | 31,000,000 | ' | ' | ' | ' | ' | 130,000,000 | ' | ' | ' | ' | ' | 90,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 149,000,000 | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 98,000,000 | ' | ' | ' | ' | 51,000,000 | ' | ' | ' | ' | 11,000,000 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | 11,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring-related Costs Incurred to Date | ' | ' | ' | ' | 136,000,000 | ' | ' | ' | ' | ' | 96,000,000 | ' | ' | ' | ' | ' | 32,000,000 | ' | ' | ' | ' | ' | 8,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,000,000 | ' | ' | ' | ' | 22,000,000 | ' | ' | ' | ' | 0 | ' | ' | ' | 0 | ' | ' | ' | ' | 74,000,000 | ' | ' | ' | ' | 74,000,000 | ' | ' | ' | ' | 0 | ' | ' | 0 | ' | ' | ' | ' | 40,000,000 | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 32,000,000 | ' | ' | ' | ' | 8,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Charges | 19,000,000 | 54,000,000 | 55,000,000 | 93,000,000 | 411,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | 44,000,000 | 26,000,000 | 64,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,000,000 | 10,000,000 | 45,000,000 | 29,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | -16,000,000 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Related Expenses | 7,000,000 | 4,000,000 | 16,000,000 | 15,000,000 | 136,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | 0 | 2,000,000 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 1,000,000 | 0 | 7,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,000,000 | 3,000,000 | 14,000,000 | 8,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 1,000,000 | 0 | 7,000,000 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1,000,000 | 0 | 7,000,000 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 7,000,000 | 3,000,000 | 16,000,000 | 8,000,000 | 0 | 0 | 0 | 0 | 1,000,000 | 0 | 2,000,000 | 0 | 0 | 0 | 0 | 0 | 6,000,000 | 3,000,000 | 14,000,000 | 8,000,000 | 0 | 0 | 0 | 0 |
Restructuring and Related Cost, Cost Incurred to Date | ' | ' | ' | ' | 547,000,000 | ' | ' | ' | ' | ' | 127,000,000 | 127,000,000 | ' | ' | ' | ' | 260,000,000 | 260,000,000 | ' | ' | ' | ' | 160,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impact of restructuring costs on the accompanying financial statements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring plan estimated future cash outflow | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 145,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 105,000,000 | 270,000,000 | ' | ' | ' | ' | 110,000,000 | 300,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash payments associated with restructuring initiatives | 36,000,000 | ' | 107,000,000 | ' | 483,000,000 | 483,000,000 | 0 | ' | 1,000,000 | ' | 103,000,000 | 103,000,000 | 36,000,000 | ' | 106,000,000 | ' | 235,000,000 | 235,000,000 | 0 | ' | 0 | ' | 145,000,000 | 16,000,000 | ' | 50,000,000 | ' | 233,000,000 | ' | 0 | ' | 1,000,000 | ' | 30,000,000 | ' | 16,000,000 | ' | 49,000,000 | ' | 113,000,000 | ' | 0 | ' | 0 | ' | 90,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | 0 | ' | 73,000,000 | 0 | ' | 0 | ' | 73,000,000 | 0 | ' | 0 | ' | 0 | 0 | 0 | 0 | 20,000,000 | ' | 57,000,000 | ' | 177,000,000 | ' | 0 | ' | 0 | ' | 0 | 20,000,000 | ' | 57,000,000 | ' | 122,000,000 | 0 | ' | 0 | ' | 55,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring and Related Cost, Incurred Cost | 26,000,000 | 58,000,000 | 71,000,000 | 108,000,000 | ' | ' | 0 | 0 | -4,000,000 | 6,000,000 | ' | ' | 26,000,000 | 56,000,000 | 75,000,000 | 99,000,000 | ' | ' | 0 | 2,000,000 | 0 | 3,000,000 | ' | 5,000,000 | 44,000,000 | 26,000,000 | 64,000,000 | ' | ' | 0 | -1,000,000 | -4,000,000 | -1,000,000 | ' | ' | 5,000,000 | 43,000,000 | 30,000,000 | 65,000,000 | ' | ' | 0 | 2,000,000 | 0 | 0 | ' | ' | 1,000,000 | 0 | 2,000,000 | 0 | ' | 0 | 0 | 0 | 0 | ' | 1,000,000 | 0 | 2,000,000 | 0 | ' | 0 | 0 | 0 | ' | 0 | 1,000,000 | 0 | 7,000,000 | ' | 0 | 1,000,000 | 0 | 7,000,000 | ' | 0 | 0 | 0 | 0 | ' | 0 | 0 | ' | 20,000,000 | 13,000,000 | 59,000,000 | 37,000,000 | ' | ' | 0 | 0 | 0 | 0 | ' | 20,000,000 | 13,000,000 | 59,000,000 | 34,000,000 | ' | 0 | 0 | 0 | 3,000,000 | ' | 0 | 0 | -16,000,000 | 0 | ' | 0 | 0 | 0 | 0 | ' | 0 | 0 | -16,000,000 | 0 | ' | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected total costs associated with the plan | ' | ' | ' | ' | ' | ' | 130,000,000 | ' | 130,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 160,000,000 | ' | 160,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33,000,000 | 90,000,000 | 51,000,000 | 11,000,000 | 22,000,000 | 75,000,000 | 8,000,000 | ' | 300,000,000 | 300,000,000 | 160,000,000 | 100,000,000 | 40,000,000 | ' | 355,000,000 | 355,000,000 | 185,000,000 | 120,000,000 | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Reserve, Settled with Cash | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | ' | ' | 1,000,000 | ' | ' | ' | ' | ' | 49,000,000 | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Adjustments to the restructuring reserve | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ($3,000,000) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ($3,000,000) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Supplemental_Balance_Sheet_Inf2
Supplemental Balance Sheet Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Allowance for doubtful accounts | ' | ' | ' | ' | ' |
Beginning balance | $84 | $83 | $88 | $81 | ' |
Charges to expenses | 2 | 1 | 7 | 7 | ' |
Utilization of allowances | -1 | -2 | -10 | -6 | ' |
Ending balance | 85 | 82 | 85 | 82 | ' |
Trade accounts receivable, net | ' | ' | ' | ' | ' |
Accounts receivable | 1,360 | ' | 1,360 | ' | 1,336 |
Less: allowance for doubtful accounts | -85 | ' | -85 | ' | -88 |
Less: allowance for sales returns | -37 | ' | -37 | ' | -31 |
Trade accounts receivable, net | 1,238 | ' | 1,238 | ' | 1,217 |
Inventories | ' | ' | ' | ' | ' |
Finished goods | 592 | ' | 592 | ' | 598 |
Work-in-process | 87 | ' | 87 | ' | 70 |
Raw materials | 216 | ' | 216 | ' | 216 |
Inventories | 895 | ' | 895 | ' | 884 |
Property, plant and equipment, net | ' | ' | ' | ' | ' |
Land | 81 | ' | 81 | ' | 81 |
Buildings and improvements | 912 | ' | 912 | ' | 873 |
Equipment, furniture and fixtures | 2,446 | ' | 2,446 | ' | 2,348 |
Capital in progress | 177 | ' | 177 | ' | 218 |
Property, plant and equipment | 3,616 | ' | 3,616 | ' | 3,520 |
Less: accumulated depreciation | 2,086 | ' | 2,086 | ' | 1,956 |
Property, plant and equipment, net | 1,530 | ' | 1,530 | ' | 1,564 |
Accrued expenses | ' | ' | ' | ' | ' |
Legal reserves | 450 | ' | 450 | ' | 452 |
Payroll and related liabilities | 170 | ' | 170 | ' | 120 |
Accrued contingent consideration | 159 | ' | 159 | ' | 100 |
Other | 567 | ' | 567 | ' | 612 |
Accrued expenses | 1,346 | ' | 1,346 | ' | 1,284 |
Other long-term liabilities | ' | ' | ' | ' | ' |
Legal reserves | 1,274 | ' | 1,274 | ' | 1,215 |
Accrued income taxes | 366 | ' | 366 | ' | 543 |
Accrued contingent consideration | 524 | ' | 524 | ' | 391 |
Other Long-Term Liabilities | 419 | ' | 419 | ' | 398 |
Other long-term liabilities | 2,583 | ' | 2,583 | ' | 2,547 |
Accrued warranties | ' | ' | ' | ' | ' |
Beginning Balance | ' | ' | 26 | 30 | ' |
Provision | ' | ' | 11 | 6 | ' |
Settlements/ reversals | ' | ' | -9 | -9 | ' |
Ending Balance | 28 | 27 | 28 | 27 | ' |
Supplemental Balance Sheet Information (Textuals) [Abstract] | ' | ' | ' | ' | ' |
Depreciation expense | $72 | $70 | $199 | $205 | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2014 | Dec. 31, 2012 |
Income Taxes, Tax Rate [Line Items] | ' | ' | ' | ' | ' | ' |
Unrecognized Tax Benefits | $1,080 | ' | $1,080 | ' | ' | $1,052 |
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | 940 | ' | 940 | ' | ' | 902 |
Interest Expense Related To Income Taxes | 9 | 15 | 28 | 26 | ' | ' |
Gross interest and penalties recognized in period | ' | ' | 43 | ' | ' | ' |
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract] | ' | ' | ' | ' | ' | ' |
Effective Income Tax Rate, Continuing Operations | 87.60% | -0.10% | 18.90% | 0.70% | ' | ' |
Effective Tax Rate | 13.10% | 16.10% | 13.70% | 15.20% | ' | ' |
Impact of certain receipts charges | -74.50% | 16.20% | -5.20% | 14.50% | ' | ' |
Incremental tax liability asserted by IRS | 1,162 | ' | 1,162 | ' | ' | ' |
Accrued Interest And Penalties Gross | 408 | ' | 408 | ' | ' | 364 |
Potential Reduction In Unrecognized Tax Benefits Over Next Twelve Months As Result Of Concluding Certain Matters | ' | ' | ' | ' | $41 | ' |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Mar. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2011 | Nov. 04, 2013 | Dec. 31, 2012 |
claims | ||||||||
Loss Contingencies (Textuals) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Accrual for legal matters that are probable and estimable | $683 | ' | ' | $683 | ' | ' | ' | $491 |
litigation-related charges (credits) | 76 | 50 | ' | 206 | 119 | ' | ' | ' |
Settlement for lost profits related to the Jang patent litigation | ' | ' | ' | ' | ' | 18.5 | ' | ' |
Settlement for royalties related to Jang patent | ' | ' | ' | ' | ' | 1 | ' | ' |
Total damages awarded to BSC related to Jang patent | ' | ' | 41 | ' | ' | ' | ' | ' |
Litigation-related charges | ' | ' | ' | ' | 135 | ' | ' | ' |
Litigationrelatedcredit | ' | ' | ' | ' | 16 | ' | ' | ' |
Product liability cases or claims related to mesh product | ' | ' | ' | ' | ' | ' | 17,000 | ' |
Putative class actions in the U.S., Mesh | ' | ' | ' | ' | ' | ' | 7 | ' |
Product liability cases or claims in Canada, Mesh | ' | ' | ' | ' | ' | ' | 10 | ' |
Putative class actions in Canada, Mesh | ' | ' | ' | ' | ' | ' | 3 | ' |
Payments for Legal Settlements | 30 | ' | ' | ' | ' | ' | ' | ' |
Legal Fees | $1 | ' | ' | ' | ' | ' | ' | ' |
Weighted_Average_Shares_Outsta2
Weighted Average Shares Outstanding (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 23.6 | 6.8 | 17.2 | 7.2 |
Stock Issued During Period, Shares, New Issues | 6 | ' | 16 | ' |
Treasury Stock, Shares, Acquired | 7 | ' | 32 | ' |
Payments for repurchase of common stock, rounded | $75 | ' | $275 | ' |
Weighted average shares outstanding | ' | ' | ' | ' |
Weighted average shares outstanding - basic | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 |
Weighted Average Number Diluted Shares Outstanding Adjustment | 0 | 0 | 0 | 0 |
Weighted average shares outstanding - assuming dilution | 1,340.30 | 1,392.50 | 1,345.20 | 1,420.30 |
Stock Options [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 18 | 62 | 18 | 61 |
Segment_Reporting_Details
Segment Reporting (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
reportablesegments | ||||
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | $1,779 | $1,706 | $5,363 | $5,338 |
Segment Reporting, Sales from Divested Businesses | 2 | 32 | 56 | 91 |
Impact of foreign currency fluctuations | -46 | -3 | -114 | -1 |
Net sales | 1,735 | 1,735 | 5,305 | 5,428 |
Operating Income Allocated to Reportable Segments | 439 | 402 | 1,261 | 1,231 |
Amortization expense | -101 | -99 | -305 | -294 |
Operating (loss) income allocated to reportable segments | 103 | -594 | -6 | -3,985 |
Other expense, net | -143 | -69 | -276 | -174 |
Income (loss) before income taxes | -40 | -663 | -282 | -4,159 |
Segment Reporting (Textuals) [Abstract] | ' | ' | ' | ' |
Number of reportable segments | ' | ' | 3 | ' |
Global Interventional Cardiology (IC) Reporting Unit [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 487 | 496 | 1,538 | 1,646 |
Global Peripheral Interventions (PI) Reporting Unit [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 202 | 188 | 601 | 571 |
Cardiovascular [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 689 | 684 | 2,139 | 2,217 |
Operating Income Allocated to Reportable Segments | 184 | 175 | 548 | 561 |
Global CRM Reporting Unit [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 474 | 467 | 1,445 | 1,466 |
Global Electrophysiology (EP) Reporting Unit [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 35 | 35 | 106 | 109 |
Rhythm Management [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 509 | 502 | 1,551 | 1,575 |
Operating Income Allocated to Reportable Segments | 68 | 58 | 192 | 218 |
Global Endoscopy (Endo) Reporting Unit [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 331 | 308 | 979 | 916 |
Global Urology (Uro) Reporting Unit [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 134 | 124 | 378 | 367 |
Global Neuromodulation (NM) Reporting Unit [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 116 | 88 | 316 | 263 |
MedSurg [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Net sales allocated to reportable segments | 581 | 520 | 1,673 | 1,546 |
Operating Income Allocated to Reportable Segments | 187 | 169 | 521 | 452 |
Corporate expenses and currency exchange [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Operating (Loss) Income Unallocated to Segment | -103 | -58 | -251 | -214 |
Special Charges [Member] | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' |
Operating (Loss) Income Unallocated to Segment | ($132) | ($839) | ($711) | ($4,708) |
Changes_in_Other_Comprehensive2
Changes in Other Comprehensive Income (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Dec. 31, 2011 |
Changes in Other Comprehensive Income [Abstract] | ' | ' | ' | ' | ' | ' |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Tax | $16 | $17 | $53 | $1 | ' | ' |
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax | -18 | -49 | -18 | -49 | -26 | -58 |
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | 115 | -31 | 115 | -31 | 34 | -48 |
Accumulated Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax | -41 | -32 | -41 | -32 | -41 | -32 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 56 | -112 | 56 | -112 | -33 | -138 |
Cumulative Translation Adjustment, Net of Tax, Period Increase (Decrease) | ' | ' | 8 | 9 | ' | ' |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Before Reclassifications, Net of Tax | ' | ' | 91 | 0 | ' | ' |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | ' | ' | 99 | 9 | ' | ' |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Reclassified from OCI, Net of Tax | ' | ' | -10 | 17 | ' | ' |
Other Comprehensive Income (Loss), Reclassifications out of OCI, Net of Tax | ' | ' | -10 | 17 | ' | ' |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 10 | 2 | 8 | 9 | ' | ' |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Net of Tax | -38 | -27 | 81 | 17 | ' | ' |
Other Comprehensive Income (Loss), Net of Tax | -28 | -25 | 89 | 26 | ' | ' |
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising Reclassed from OCI, Tax | $6 | $1 | $5 | $9 | ' | ' |