PFIZER INC, 10-K filed on 2/28/2019
Annual Report
v3.10.0.1
Document and Entity Information - USD ($)
$ in Billions
 12 Months Ended
Dec. 31, 2018
Feb. 26, 2019
Jul. 01, 2018
Document and Entity Information [Abstract]      
Entity Registrant Name PFIZER INC.    
Entity Central Index Key 0000078003    
Current Fiscal Year End Date --12-31    
Entity Filer Category Large Accelerated Filer    
Entity Emerging Growth Company false    
Entity Small Business false    
Entity Shell Company false    
Document Type 10-K    
Document Period End Date Dec. 31, 2018    
Document Fiscal Year Focus 2018    
Document Fiscal Period Focus FY    
Amendment Flag false    
Trading Symbol PFE    
Entity Common Stock, Shares Outstanding   5,551,804,790  
Entity Well-known Seasoned Issuer Yes    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Public Float     $ 212
v3.10.0.1
Consolidated Statements of Income - USD ($)
shares in Millions, $ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Income Statement [Abstract]      
Revenues [1] $ 53,647 $ 52,546 $ 52,824
Costs and expenses:      
Cost of sales [1],[2] 11,248 11,228 12,322
Selling, informational and administrative expenses [1],[2] 14,455 14,804 14,844
Research and development expenses [1],[2] 8,006 7,683 7,892
Amortization of intangible assets [1] 4,893 4,758 4,056
Restructuring charges and certain acquisition-related costs [1] 1,044 351 1,565
Other (income)/deductions––net [1] 2,116 1,416 3,794
Income from continuing operations before provision/(benefit) for taxes on income [1],[3],[4],[5] 11,885 12,305 8,351
Provision/(benefit) for taxes on income [1] 706 (9,049) 1,123
Income from continuing operations [1] 11,179 21,353 7,229
Discontinued operations:      
Income from discontinued operations––net of tax [1] 10 (1) 16
Gain on disposal of discontinued operations––net of tax [1] 0 3 0
Discontinued operations––net of tax [1] 10 2 17
Net income before allocation to noncontrolling interests [1],[6],[7],[8] 11,188 21,355 7,246
Less: Net income attributable to noncontrolling interests [1] 36 47 31
Net income attributable to Pfizer Inc. [1] $ 11,153 $ 21,308 $ 7,215
Earnings per common share––basic:      
Income from continuing operations attributable to Pfizer Inc. common shareholders (in dollars per share) [1] $ 1.90 $ 3.57 $ 1.18
Discontinued operations––net of tax (in dollars per share) [1] 0.00 0.00 0.00
Net income attributable to Pfizer Inc. common shareholders (in dollars per share) [1] 1.90 3.57 1.18
Earnings per common share––diluted:      
Income from continuing operations attributable to Pfizer Inc. common shareholders (in dollars per share) [1] 1.86 3.52 1.17
Discontinued operations––net of tax (in dollars per share) [1] 0.00 0.00 0.00
Net income attributable to Pfizer Inc. common shareholders (in dollars per share) [1] $ 1.87 $ 3.52 $ 1.17
Weighted-average shares––basic [1],[9] 5,872 5,970 6,089
Weighted-average shares––diluted [1],[9] 5,977 6,058 6,159
[1] Amounts may not add due to rounding.
[2] Exclusive of amortization of intangible assets, except as disclosed in Note 1L. Basis of Presentation and Significant Accounting Policies: Amortization of Intangible Assets, Depreciation and Certain Long-Lived Assets.
[3] 2017 v. 2016––The decrease in the domestic loss was primarily due to lower restructuring charges and certain acquisition-related costs, the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower certain asset impairments and lower certain legal matters, partially offset by higher net losses on early retirement of debt, and higher amortization of intangible assets. The increase in international income was primarily due to the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower restructuring charges and certain acquisition-related costs, and lower certain asset impairments.
[4] 2018 v. 2017––The decrease in the domestic loss was primarily due to lower interest expense paid to certain foreign subsidiaries, lower net losses on the retirement of debt, higher net gains on investments in equity securities and increased revenue related to Eliquis, partially offset by higher certain asset impairments and lower revenue for Viagra and the SIP portfolio. The decrease in international income was primarily related to lower interest income received primarily from intercompany borrowings from Pfizer Inc. and higher charges related to certain cost reduction initiatives, partially offset by increased revenue related to Ibrance and Eliquis.
[5] Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
[6] Amounts may not add due to rounding.
[7] Amounts may not add due to rounding.
[8] Amounts may not add due to rounding.
[9] 2017 includes the effect of the modification for a commitment to pay 15.2 million common-share equivalents that were scheduled for near-term settlement.
v3.10.0.1
Consolidated Statements of Comprehensive Income - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Statement of Comprehensive Income [Abstract]      
Net income before allocation to noncontrolling interests [1],[2],[3],[4] $ 11,188 $ 21,355 $ 7,246
Foreign currency translation adjustments, net [2] (799) 1,116 (815)
Reclassification adjustments [2],[5] (22) 162 0
Other comprehensive income (loss), foreign currency transaction and translation adjustment, before tax, total [2] (821) 1,278 (815)
Unrealized holding gains/(losses) on derivative financial instruments, net [2] 220 (10) (442)
Reclassification adjustments for (gains)/losses included in net income(b) [2],[6] 27 (520) 452
Other comprehensive income (loss), derivatives qualifying as hedges, before tax, total [2] 247 (530) 10
Unrealized holding gains/(losses) on available-for-sale securities, net [2] (185) 818 248
Reclassification adjustments for (gains)/losses included in net income [2],[6] 124 (244) (118)
Reclassification adjustments for unrealized gains included in Retained earnings [2],[7] (462) 0 0
Other comprehensive income (loss), available-for-sale securities adjustment, before tax, total [2] (522) 574 130
Benefit plans: actuarial losses, net [2] (649) (212) (1,888)
Reclassification adjustments related to amortization [2] 242 588 558 [7]
Reclassification adjustments related to settlements, net [2] 142 117 127 [7]
Other [2] 112 (145) 195
Defined benefit Plan, amounts recognized in other comprehensive income (loss), net gain (loss), before tax, total [2] (153) 348 (1,009)
Benefit plans: prior service (costs)/credits and other, net [2] (9) (2) 184
Reclassification adjustments related to amortization [2] (181) (184) (173) [7]
Reclassification adjustments related to curtailments, net [2] (19) (18) (26) [7]
Other [2] 2 0 6
Defined benefit plan, amounts recognized in other comprehensive income (loss), net prior service cost, before tax [2] (207) (203) (8)
Other comprehensive income/(loss), before tax [2] (1,457) 1,468 (1,692)
Tax provision/(benefit) on other comprehensive income/(loss) [2],[8] 518 (262) (174)
Other comprehensive income/(loss) before allocation to noncontrolling interests [2],[4] (1,975) 1,730 (1,518)
Comprehensive income before allocation to noncontrolling interests [2] 9,214 23,085 5,728
Less: Comprehensive income attributable to noncontrolling interests [2] 16 62 28
Comprehensive income attributable to Pfizer Inc. [2] $ 9,198 $ 23,023 $ 5,701
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
[3] Amounts may not add due to rounding.
[4] Amounts may not add due to rounding.
[5] For the year ended December 31, 2017, the foreign currency translation adjustments reclassified into Other (income)/deductions—net in the consolidated statement of income primarily result from the sale of our 40% ownership investment in Teuto and the sale of our 49% equity share in Hisun Pfizer. See Note 2F. Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment: Equity-Method Investments.
[6] Reclassified into Other (income)/deductions—net and Cost of sales in the consolidated statements of income. For additional information on amounts reclassified into Cost of sales, see Note 7F. Financial Instruments: Derivative Financial Instruments and Hedging Activities.
[7] For additional information, see Note 1B. Basis of Presentation and Significant Accounting Policies: Adoption of New Accounting Standards in 2018.
[8] See Note 5E. Tax Matters: Tax Provision/(Benefit) on Other Comprehensive Income/(Loss).
v3.10.0.1
Consolidated Statements of Comprehensive Income (Parenthetical)
Dec. 31, 2017
Nov. 10, 2017
Oct. 01, 2017
Jun. 30, 2017
Dec. 31, 2016
Laboratorio Teuto Brasilero [Member]          
Equity method investment, ownership percentage     40.00% 40.00% 40.00%
Hisun Pfizer Pharmaceuticals Co. Ltd [Member]          
Equity method investment, ownership percentage 49.00% 49.00%     49.00%
v3.10.0.1
Consolidated Balance Sheets - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Assets    
Cash and cash equivalents [1] $ 1,139 $ 1,342
Short-term investments [1] 17,694 18,650
Trade accounts receivable, less allowance for doubtful accounts: 2018—$541; 2017—$584 [1] 8,025 8,221
Inventories [1] 7,508 7,578
Current tax assets [1] 3,374 3,050
Other current assets [1] 2,461 2,289
Assets held for sale [1] 9,725 12
Total current assets [1] 49,926 41,141
Long-term investments [1] 2,767 7,015
Property, plant and equipment, less accumulated depreciation [1],[2] 13,385 13,865
Identifiable intangible assets, less accumulated amortization [1],[3] 35,211 48,741
Goodwill [1] 53,411 55,952
Noncurrent deferred tax assets and other noncurrent tax assets [1] 1,924 1,855
Other noncurrent assets [1] 2,799 3,227
Total assets [1] 159,422 171,797
Liabilities and Equity    
Short-term borrowings, including current portion of long-term debt: 2018—$4,776; 2017—$3,546 [1] 8,831 9,953
Trade accounts payable [1] 4,674 4,656
Dividends payable [1] 2,047 2,029
Income taxes payable [1] 1,265 477
Accrued compensation and related items [1] 2,397 2,196
Other current liabilities [1] 10,753 11,115
Liabilities held for sale [1] 1,890 0
Total current liabilities [1] 31,858 30,427
Long-term debt [1] 32,909 33,538
Pension benefit obligations, net [1] 5,272 5,926
Postretirement benefit obligations, net [1] 1,338 1,504
Noncurrent deferred tax liabilities [1] 3,700 3,900
Other taxes payable [1] 14,737 18,697
Other noncurrent liabilities [1] 5,850 6,149
Total liabilities [1] 95,664 100,141
Commitments and Contingencies [1]
Preferred stock, no par value, at stated value; 27 shares authorized; issued: 2018—-478; 2017—-524 [1] 19 21
Common stock, $0.05 par value; 12,000 shares authorized; issued: 2018—-9,332; 2017—-9,275 [1] 467 464
Additional paid-in capital [1] 86,253 84,278
Treasury stock, shares at cost: 2018—3,615; 2017—-3,296 [1] (101,610) (89,425)
Retained earnings [1] 89,554 85,291
Accumulated other comprehensive loss [1] (11,275) (9,321)
Total Pfizer Inc. shareholders’ equity [1] 63,407 71,308
Equity attributable to noncontrolling interests [1] 351 348
Total equity [1],[4] 63,758 71,656
Total liabilities and equity [1] $ 159,422 $ 171,797
[1] Amounts may not add due to rounding.
[2] The decrease in total property, plant and equipment is primarily due to depreciation, the reclassification of $675 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C), reductions due to asset impairments largely associated with cost reduction initiatives not associated with acquisitions (see Note 3), and the impact of foreign exchange, partially offset by capital additions.
[3] The decrease in Identifiable intangible assets, less accumulated amortization, is primarily due to the reclassification of $5.8 billion of intangible assets, net, ($6.3 billion total gross carrying amount) to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and amortization and impairments, partially offset by additions, mainly consisting of $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E).
[4] Amounts may not add due to rounding.
v3.10.0.1
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Statement of Financial Position [Abstract]    
Accounts receivable, allowance for doubtful accounts [1] $ 541 $ 584
Short term borrowings, current portion of long term debt [1] $ 4,776 $ 3,546
Preferred stock, shares authorized [1] 27,000,000 27,000,000
Preferred stock, shares issued [1] 478 524
Common stock, par value (in dollars per share) [1] $ 0.05 $ 0.05
Common stock, shares authorized [1] 12,000,000,000 12,000,000,000
Common stock, shares issued [1] 9,332,000,000 9,275,000,000
Treasury stock, shares at cost [1] 3,615,000,000 3,296,000,000
[1] Amounts may not add due to rounding.
v3.10.0.1
Consolidated Statements of Equity - USD ($)
$ in Millions
Total
Shareholders’ Equity
Preferred Stock [Member]
Common Stock [Member]
Add’l Paid-In Capital [Member]
Treasury Stock [Member]
Retained Earnings [Member]
Accum. Other Comp. Loss [Member]
Non-controlling Interests [Member]
Beginning balance (in shares) at Dec. 31, 2015 [1]     649 9,178,000,000   3,003,000,000      
Beginning balance at Dec. 31, 2015 [1] $ 64,998 $ 64,720 $ 26 $ 459 $ 81,016 $ (79,252) $ 71,993 $ (9,522) $ 278
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net income [1] 7,246 [2],[3],[4] 7,215         7,215   31
Other comprehensive income/(loss), net of tax [1] (1,518) [2] (1,514)           (1,514) (3)
Cash dividends declared:                  
Common stock [1] (7,446) (7,446)         (7,446)    
Preferred stock [1] (2) (2)         (2)    
Noncontrolling interests [1] (10)               (10)
Share-based payment transactions (in shares) [1]       52,000,000   (3,000,000)      
Share-based payment transactions [1] $ 1,563 1,563   $ 3 1,672 $ (111)      
Purchases of common stock (in shares) (154,000,000) [5]         (154,000,000) [1]      
Purchases of common stock [1] $ (5,000) [5] (5,000)       $ (5,000)      
Preferred stock conversions and redemptions (in shares) [1]     (52)            
Preferred stock conversions and redemptions [1] (5) (5) $ (2)   (2)        
Other [1],[6] 13 13         (13)    
Ending balance (in shares) at Dec. 31, 2016 [1]     597 9,230,000,000   3,160,000,000      
Ending balance at Dec. 31, 2016 [1] 59,840 59,544 $ 24 $ 461 82,685 $ (84,364) 71,774 (11,036) 296
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net income [1] 21,355 [2],[3],[4] 21,308         21,308   47
Other comprehensive income/(loss), net of tax [1] 1,730 [2] 1,715           1,715 14
Cash dividends declared:                  
Common stock [1] (7,789) (7,789)         (7,789)    
Preferred stock [1] (1) (1)         (1)    
Noncontrolling interests [1] (9)               (9)
Share-based payment transactions (in shares) [1],[7]       45,000,000   15,000,000      
Share-based payment transactions [1],[7] $ 1,536 1,536   $ 2 1,597 $ (63)      
Purchases of common stock (in shares) (150,000,000) [8]         (150,000,000) [1]      
Purchases of common stock [1] $ (5,000) [8] (5,000)       $ (5,000)      
Preferred stock conversions and redemptions (in shares) [1]     (73)            
Preferred stock conversions and redemptions (5) [1] (5) [1] $ (3) [1]   (3) [1] $ 1      
Other [1] 0 0         0    
Ending balance (in shares) at Dec. 31, 2017 [1]     524 9,275,000,000   3,296,000,000      
Ending balance at Dec. 31, 2017 [1] 71,656 [9] 71,308 $ 21 $ 464 84,278 $ (89,425) 85,291 (9,321) 348
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net income [1] 11,188 [2],[3],[4] 11,153         11,153   36
Other comprehensive income/(loss), net of tax [1] (1,975) [2] (1,955)           (1,955) (20)
Cash dividends declared:                  
Common stock [1] (8,060) (8,060)         (8,060)    
Preferred stock [1] (1) (1)         (1)    
Noncontrolling interests [1] (12)               (12)
Share-based payment transactions (in shares) [1]       57,000,000   (12,000,000)      
Share-based payment transactions [1] $ 1,993 1,993   $ 3 1,977 $ 13      
Purchases of common stock (in shares) (307,000,000) [10]         (307,000,000) [1]      
Purchases of common stock [1] $ (12,198) [10] (12,198)       $ (12,198)      
Preferred stock conversions and redemptions (in shares) [1]     (46)            
Preferred stock conversions and redemptions [1] (4) (4) $ (2)   (3)        
Other [1],[11] 1,172 1,172         1,172    
Ending balance (in shares) at Dec. 31, 2018 [1]     478 9,332,000,000   3,615,000,000      
Ending balance at Dec. 31, 2018 [1] $ 63,758 [9] $ 63,407 $ 19 $ 467 $ 86,253 $ (101,610) $ 89,554 $ (11,275) $ 351
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
[3] Amounts may not add due to rounding.
[4] Amounts may not add due to rounding.
[5] Represents shares purchased pursuant to the accelerated share repurchase agreement entered into on March 8, 2016. See above for additional information.
[6] Represents the $13 million cumulative effect of the adoption of a new accounting standard in the fourth quarter of 2016, as of January 1, 2016, for certain elements of the accounting for share-based payments. For additional information, see Notes to Consolidated Financial Statements––Note 1B. Basis of Presentation and Significant Accounting Policies: Adoption of New Accounting Standards in Pfizer’s 2016 Financial Report.
[7] 2017 treasury shares include the effect of the modification for a commitment to pay 15.2 million common-share equivalents that were scheduled for near-term settlement. These common share equivalents were paid in the first quarter of 2018.
[8] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on February 2, 2017. See above for additional information.
[9] Amounts may not add due to rounding.
[10] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on March 12, 2018, as well as other share repurchases. See above for additional information.
[11] Primarily represents the cumulative effect of the adoption of new accounting standards in the first quarter of 2018 for revenues, financial assets and liabilities, income tax accounting, and the reclassification of certain tax effects from Accumulated other comprehensive income. For additional information, see Notes to Consolidated Financial Statements––Note 1B. Basis of Presentation and Significant Accounting Policies: Adoption of New Accounting Standards in Pfizer’s 2018 Financial Report.
v3.10.0.1
Consolidated Statements of Equity (Parenthetical)
shares in Millions, $ in Millions
Jan. 01, 2016
USD ($)
Accounting Standards Update 2016-09 [Member] | Retained Earnings [Member]  
Cumulative effect of the adoption of new accounting standard $ 13
v3.10.0.1
Consolidated Statements of Cash Flows - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Operating Activities      
Net income before allocation to noncontrolling interests [1],[2],[3],[4] $ 11,188 $ 21,355 $ 7,246
Adjustments to reconcile net income before allocation to noncontrolling interests to net cash provided by operating activities:      
Depreciation and amortization [1] 6,384 6,269 5,757
Asset write-offs and impairments [1] 3,398 634 1,613
Loss on sale of HIS net assets [1],[5] (1) 55 1,712
TCJA impact [1],[6] (596) (10,660) 0
Deferred taxes from continuing operations [1] (2,205) (2,410) (700)
Share-based compensation expense [1] 949 840 691
Benefit plan contributions in excess of expense [1] (1,095) (961) (712)
Other adjustments, net [1] (1,268) 344 487
Other changes in assets and liabilities, net of acquisitions and divestitures:      
Trade accounts receivable [1] (644) 259 (134)
Inventories [1] (717) (357) 365
Other assets [1] (16) 7 (47)
Trade accounts payable [1] 431 46 871
Other liabilities [1] 98 (67) (223)
Other tax accounts, net [1] (78) 1,446 (734)
Net cash provided by operating activities [1] 15,827 16,802 16,192
Investing Activities      
Purchases of property, plant and equipment [1] (2,042) (1,956) (1,823)
Purchases of short-term investments [1] (11,677) (14,596) (15,957)
Proceeds from redemptions/sales of short-term investments [1] 17,581 10,302 29,414
Net (purchases of)/proceeds from redemptions/sales of short-term investments with original maturities of three months or less [1] (3,917) 2,058 (4,218)
Purchases of long-term investments [1] (1,797) (3,537) (8,011)
Proceeds from redemptions/sales of long-term investments [1] 6,244 3,579 11,268
Acquisitions of businesses, net of cash acquired [1] 0 (1,000) (18,368)
Acquisitions of intangible assets [1] (154) (261) (176)
Other investing activities, net [1],[7] 288 671 80
Net cash provided by/(used in) investing activities [1] 4,525 (4,740) (7,791)
Financing Activities      
Proceeds from short-term borrowings [1] 3,711 8,464 7,472
Principal payments on short-term borrowings [1] (4,437) (9,947) (5,093)
Net (payments on)/proceeds from short-term borrowings with original maturities of three months or less [1] (1,617) 1,422 (3,060)
Proceeds from issuance of long-term debt [1] 4,974 5,274 10,976
Principal payments on long-term debt [1] (3,566) (6,154) (7,689)
Purchases of common stock [1] (12,198) (5,000) (5,000)
Cash dividends paid [1] (7,978) (7,659) (7,317)
Proceeds from exercise of stock options [1] 1,259 862 1,019
Other financing activities, net [1] (588) (611) (536)
Net cash used in financing activities [1] (20,441) (13,350) (9,228)
Effect of exchange-rate changes on cash and cash equivalents and restricted cash and cash equivalents [1] (116) 53 (215)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents [1] (205) (1,235) (1,041)
Cash and cash equivalents and restricted cash and cash equivalents, beginning [1] 1,431 2,666 3,707
Cash and cash equivalents and restricted cash and cash equivalents, end [1] 1,225 1,431 2,666
Supplemental Cash Flow Information      
Exchange of $1.1 billion net book value 6.50% U.K. pound denominated bonds maturing in 2038 for $1.8 billion of new 2.735% U.K. pound denominated bonds maturing in 2043, resulting in a debt extinguishment loss of $747 million [1],[8] 0 1,848 0
Receipt of ICU Medical common stock [1],[7] 0 428 0
Promissory note from ICU Medical [1],[7] 0 75 0
Cash paid (received) during the period for:      
Income taxes [1] 3,655 2,489 2,521
Interest [1] 1,311 1,518 1,451
Interest rate hedges [1] (38) (199) (338)
Cerevel Therapeutics [Member]      
Supplemental Cash Flow Information      
Equity investment in exchange for Pfizer's assets [1],[7] 343 0 0
Allogene [Member]      
Supplemental Cash Flow Information      
Equity investment in exchange for Pfizer's assets [1],[7] $ 92 $ 0 $ 0
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
[3] Amounts may not add due to rounding.
[4] Amounts may not add due to rounding.
[5] In 2018 and 2017, represents adjustments to amounts previously recorded in 2016 to write down the HIS net assets to fair value less costs to sell related to the sale of HIS net assets to ICU Medical on February 3, 2017. In 2016, represents a charge related to the write-down of the HIS net assets to fair value less estimated costs to sell. See Note 2B for additional information.
[6] As a result of the enactment of the TCJA in December 2017, Pfizer’s Provision/(benefit) for taxes on income (i) for the year ended December 31, 2017 was favorably impacted by approximately $10.7 billion, primarily reflecting the remeasurement of U.S. deferred tax liabilities, which includes the repatriation tax on deemed repatriated accumulated post-1986 earnings of foreign subsidiaries and (ii) for the year ended December 31, 2018 was favorably impacted by approximately $600 million, primarily related to certain tax initiatives associated with the TCJA, as well as favorable adjustments to the provisional estimates of the legislation. See Note 5A. Tax Matters: Taxes on Income from Continuing Operations for additional information.
[7] For additional information, see Note 2B. Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment: Divestitures.
[8] The $747 million is included in the net loss of $846 million upon the exchange and early retirement of the U.K. pound-denominated debt. See Note 7D. Financial Instruments: Long-Term Debt for additional information.
v3.10.0.1
Consolidated Statements of Cash Flows (Parenthetical)
£ in Millions
 1 Months Ended 12 Months Ended
Dec. 31, 2017
USD ($)
Dec. 31, 2017
GBP (£)
Nov. 30, 2016
USD ($)
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2016
USD ($)
Tax Benefit from Tax Cuts and Jobs Act of 2017 [1],[2]       $ 596,000,000 $ 10,660,000,000 $ 0
Tax benefits associated with the enactment of the TCJA [3]       596,000,000 10,660,000,000 0
Loss on early retirement of debt $ 999,000,000   $ 312,000,000 $ 3,000,000 [4] 999,000,000 [4] $ 312,000,000 [4]
Senior Unsecured U.K. Pound Debt, 6.50%, Due 2038 [Member]            
Loss on early retirement of debt $ 846,000,000          
U.K. Pound Denominated Debt [Member]            
Loss on exchange of debt         747,000,000  
Senior Notes [Member] | Senior Unsecured U.K. Pound Debt, 6.50%, Due 2038 [Member]            
Amount of debt exchanged   £ 833     $ 1,100,000,000  
Interest rate, percentage 6.50%       6.50%  
Senior Notes [Member] | Senior Unsecured U.K. Pound Debt, 2.735%, Due 2043 [Member]            
Interest rate, percentage 2.735%       2.735%  
Debt instrument, face amount $ 1,800,000,000       $ 1,800,000,000  
[1] Amounts may not add due to rounding.
[2] As a result of the enactment of the TCJA in December 2017, Pfizer’s Provision/(benefit) for taxes on income (i) for the year ended December 31, 2017 was favorably impacted by approximately $10.7 billion, primarily reflecting the remeasurement of U.S. deferred tax liabilities, which includes the repatriation tax on deemed repatriated accumulated post-1986 earnings of foreign subsidiaries and (ii) for the year ended December 31, 2018 was favorably impacted by approximately $600 million, primarily related to certain tax initiatives associated with the TCJA, as well as favorable adjustments to the provisional estimates of the legislation. See Note 5A. Tax Matters: Taxes on Income from Continuing Operations for additional information.
[3] The 2018 current tax benefit and deferred tax expense primarily relate to the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See discussion below and Note 5C.
[4] In 2017 and 2016, represents net losses due to the early retirement of debt, inclusive of the related termination of cross currency swaps in 2017 and inclusive of the related termination of interest rate swaps in 2016.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies
 12 Months Ended
Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation and Significant Accounting Policies
Basis of Presentation and Significant Accounting Policies

A. Basis of Presentation

See the Glossary of Defined Terms at the beginning of this 2018 Financial Report for terms used throughout the consolidated financial statements and related notes in this 2018 Financial Report.

The consolidated financial statements include our parent company and all subsidiaries, and are prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The decision of whether or not to consolidate an entity requires consideration of majority voting interests, as well as effective economic or other control over the entity. Typically, we do not seek control by means other than voting interests. For subsidiaries operating outside the U.S., the financial information is included as of and for the year ended November 30 for each year presented. Pfizer's fiscal year-end for U.S. subsidiaries is as of and for the year ended December 31 for each year presented. Substantially all unremitted earnings of international subsidiaries are free of legal and contractual restrictions. All significant transactions among our businesses have been eliminated. Beginning on January 1, 2018, only taxes paid on intercompany inventory sales transactions are deferred until recognized upon the sale of the inventory to a third party, reflecting the adoption of a new accounting standard in the first quarter of 2018. Prior to the adoption of this new accounting standard in the first quarter of 2018, taxes paid on intercompany sales transactions were deferred until recognized upon sale of the asset to a third party. See Note 1B for further information.

From the second quarter of our 2016 fiscal year until the end of 2018, we managed our commercial operations through two distinct business segments: Pfizer Innovative Health (IH) and Pfizer Essential Health (EH). For additional information, see Note 18.

Certain amounts in the consolidated financial statements and associated notes may not add due to rounding. All percentages have been calculated using unrounded amounts.

In the first quarter of 2018, as of January 1, 2018, we adopted eleven new accounting standards. See Note 1B for further information.

Our recent significant business development activities include:
•
On December 19, 2018, we announced that we entered into a definitive agreement with GSK under which we and GSK have agreed to combine our respective consumer healthcare businesses into a new consumer healthcare joint venture, which will operate globally under the GSK Consumer Healthcare name. Assets and liabilities associated with our Consumer Healthcare business were reclassified as held for sale in the consolidated balance sheet as of December 31, 2018. We expect to complete the transaction during the second half of 2019, subject to customary closing conditions, including GSK shareholder approval and required regulatory approvals.
•
On February 3, 2017, we completed the sale of our global infusion systems net assets, HIS, to ICU Medical, a global device manufacturer, for up to approximately $900 million, composed of cash and contingent cash consideration, ICU Medical common stock (all of which we sold during 2018) and seller financing. HIS includes IV pumps, solutions and devices. The operating results of HIS are included in the consolidated statement of income and EH’s operating results through February 2, 2017 and, therefore, our financial results, and EH’s operating results, for the year ended December 31, 2017 reflect approximately one month of HIS domestic operations and approximately two months of HIS international operations, while our financial results, and EH’s operating results, for the year ended December 31, 2016 reflect 12 months of HIS global operations. Our financial results, and EH’s operating results, for 2018 do not reflect any contribution from HIS global operations.
•
On December 22, 2016, which fell in the first fiscal quarter of 2017 for our international operations, we acquired the development and commercialization rights to AstraZeneca’s small molecule anti-infectives business, primarily outside the U.S. for $1,040 million, composed of cash and contingent consideration. Commencing from the acquisition date, our financial statements reflect the assets, liabilities, operating results and cash flows of this business, and, in accordance with our international reporting period, our financial results, EH’s operating results, and cash flows for the year ended December 31, 2017 reflect approximately 11 months of the small molecule anti-infectives business acquired from AstraZeneca.
•
On September 28, 2016, we acquired Medivation for $81.50 per share. The total fair value of consideration transferred for Medivation was approximately $14.3 billion in cash ($13.9 billion, net of cash acquired). Commencing from the acquisition date, our financial statements reflect the assets, liabilities, operating results and cash flows of Medivation. In accordance with our domestic and international reporting periods, our consolidated financial statements for the year ended December 31, 2016 reflect approximately three months of Medivation operations.
•
On June 24, 2016, we acquired Anacor for $99.25 per share. The total fair value of consideration transferred for Anacor was approximately $4.9 billion in cash ($4.5 billion, net of cash acquired), plus $698 million debt assumed. Commencing from the acquisition date, our financial statements reflect the assets, liabilities, operating results and cash flows of Anacor. In accordance with our domestic and international reporting periods, our consolidated financial statements for the year ended December 31, 2016 reflect approximately six months of Anacor operations.
•
On April 6, 2016, we announced that the merger agreement between Pfizer and Allergan entered into on November 22, 2015 was terminated by mutual agreement of the companies. The decision was driven by the actions announced by the U.S. Department of Treasury on April 4, 2016, which the companies concluded qualified as an “Adverse Tax Law Change” under the merger agreement. In connection with the termination of the merger agreement, on April 8, 2016 (which fell into Pfizer’s second fiscal quarter of 2016), Pfizer paid Allergan $150 million (pre-tax) for reimbursement of Allergan’s expenses associated with the terminated transaction (see Note 4). Pfizer and Allergan also released each other from any and all claims in connection with the merger agreement.
For additional information, see Note 2.
B. Adoption of New Accounting Standards in 2018

On January 1, 2018, we adopted eleven new accounting standards. The quantitative impacts on our prior period consolidated financial statements of adopting the following new standards are summarized in the tables within the section titled Impacts to our Consolidated Financial Statements, further below.

Revenues––We adopted a new accounting standard for revenue recognition and changed our revenue recognition policies accordingly. Generally, the previous revenue recognition standards permitted recognition when persuasive evidence of a contract existed, delivery had occurred, and the seller's price to the buyer was fixed or determinable. Under the new standard, revenue is recognized upon transfer of control of the product to our customer in an amount that reflects the consideration we expect to receive in exchange. We adopted the new accounting standard utilizing the modified retrospective method, and, therefore, no adjustments were made to amounts in our prior period financial statements. We recorded the cumulative effect of adopting the standard as an adjustment to increase the opening balance of Retained earnings by $584 million on a pre-tax basis ($450 million after-tax). This amount includes $500 million (pre-tax) related to the timing of recognizing Other (income)/deductions––net primarily for upfront and milestone payments on our collaboration arrangements ($394 million, pre-tax) and, to a lesser extent, product rights and out-licensing arrangements, and $84 million (pre-tax) related to the timing of recognizing Revenues and Cost of sales on certain product shipments. The impact of adoption did not have a material impact to our consolidated statement of income for the year ended December 31, 2018 nor on our consolidated balance sheet as of December 31, 2018. For additional information, see Note 1G and Note 1H.
Financial Assets and Liabilities––The new accounting standard related to the recognition and measurement of financial assets and liabilities makes the following changes to prior guidance and requires:
•
certain equity investments to be measured at fair value with changes in fair value now recognized in net income. However, equity investments that do not have readily determinable fair values may be measured at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer;
•
a qualitative assessment of equity investments without readily determinable fair values to identify impairment; and
•
separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or in the accompanying notes to the financial statements.
We adopted the new accounting standard utilizing the modified retrospective method, and, therefore, no adjustments were made to amounts in our prior period financial statements. We recorded the cumulative effect of adopting the standard as an adjustment to increase the opening balance of Retained earnings by $462 million on a pre-tax basis ($419 million after-tax) related to the net impact of unrealized gains and losses primarily on available-for-sale equity securities, restricted stock and private equity securities. In 2018, we recorded net unrealized gains on equity securities of $477 million, in Other (income)/deductions––net. For additional information, see Note 4 and Note 7.

Presentation of Net Periodic Pension and Postretirement Benefit Cost––We adopted a new accounting standard that requires the net periodic pension and postretirement benefit costs other than the service costs be presented in Other (income)/deductions––net, and that the presentation be applied retrospectively. We adopted the presentation of the net periodic benefit costs other than service costs by reclassifying these costs from Cost of sales, Selling, informational and administrative expenses, Research and development expenses and Restructuring charges and certain acquisition-related costs to Other (income)/deductions––net. We elected to apply the practical expedient as it is impracticable to determine the disaggregation of the cost components for amounts capitalized within Inventories and property, plant and equipment and amortized in each of those periods. We have therefore reclassified the prior period net periodic benefit costs/(credits) disclosed in Note 11 to apply the retrospective presentation for comparative periods.
As of January 1, 2018, only service costs will be included in amounts capitalized in Inventories or property, plant and equipment, while the other components of net periodic benefit costs will be included in Other (income)/deductions––net. For additional information, see Note 4 and Note 11.
Income Tax Accounting––The new guidance removes the prohibition against recognizing current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to a third party, unless the asset transferred is inventory. We adopted the standard utilizing the modified retrospective method, and, therefore, no adjustments were made to amounts in our prior period financial statements. We recorded the cumulative effect of adopting the standard as an adjustment to decrease the opening balance of Retained earnings by $189 million.
Accounting for Hedging Activities––The standard includes the following changes:
•
Permits hedge accounting for risk components in hedging relationships involving nonfinancial risk and interest rate risk;
•
Changes the guidance for designating fair value hedges of interest rate risk and for measuring the change in fair value of the hedged item in fair value hedges of interest rate risk;
•
No longer requires the separate measurement and reporting of hedge ineffectiveness, but requires the income statement presentation of the earnings effect of the hedging instrument with the earnings effect of the hedged item;
•
Permits us to exclude the portion of the change in fair value of a currency swap that is attributable to a cross-currency basis spread from the assessment of hedge effectiveness; and
•
Simplifies hedge effectiveness testing.
We early adopted the new accounting standard on January 1, 2018 on a prospective basis. In 2018, we recorded income of $107 million in Other (income)/deductions––net, whereas this item would have been classified in interest income in prior periods. For additional information, see Note 7F.
Reclassification of Certain Tax Effects from AOCI––We early adopted a new accounting standard that provides guidance on the reclassification of certain tax effects from AOCI. Under the new guidance, we elected to reclassify the stranded tax amounts related to the TCJA from AOCI to Retained earnings. We adopted the new accounting standard utilizing the modified retrospective method, and recorded the cumulative effect of adopting the standard as an adjustment to increase the opening balance of Retained earnings by $495 million, primarily due to the effect of the change in the U.S. Federal corporate tax rate. The impact on other stranded tax amounts related to the application of the TCJA was not material to our consolidated financial statements.
Classification of Certain Transactions in the Statement of Cash Flows––We retrospectively adopted an accounting standard that changed the presentation of certain information in the consolidated statements of cash flows, including the classification of:
•
debt prepayment and extinguishment costs, resulting in an increase in Operating activities––Other adjustments, net and a decrease in Financing activities––Other financing activities, net of $7 million for the year ended December 31, 2018; and
•
accreted interest on the settlement of commercial paper debt instruments, resulting in a decrease in Operating activities––Other adjustments, net, and an increase in Financing activities––Other financing activities, net of $83 million for the year ended December 31, 2018.
The new standard also establishes guidance on the classification of certain cash flows related to contingent consideration in a business acquisition. Cash payments made soon after a business acquisition date will be classified as Investing activities, while payments made thereafter will be classified as Financing activities. Payments made in excess of the amount of the original contingent consideration liability will be classified as Operating activities. The adoption of this guidance did not have a material impact to our consolidated financial statements.
Presentation of Restricted Cash in the Statement of Cash Flows––We adopted, on a retrospective basis, the new accounting standard, which requires that restricted cash and restricted cash equivalents be included with Cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown in the consolidated statements of cash flows. As a result, for the year ended December 31, 2018, $2 million is presented as a decrease in Cash, cash equivalents, restricted cash and restricted cash equivalents.
Definition of a Business––We prospectively adopted the standard for determining whether business development transactions should be accounted for as acquisitions (or disposals) of assets or businesses. If substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset, the transaction will not qualify for treatment as a business. To be considered a business, a set of integrated activities and assets must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs, without regard as to whether a purchaser could replace missing elements. In addition, the definition of the term “output” has been narrowed to make it consistent with the updated revenue recognition guidance. In 2018, there was no impact to our consolidated financial statements from the adoption of this new standard.
Derecognition of Nonfinancial Assets––We prospectively adopted the standard, which applies to the full or partial sale or transfer of nonfinancial assets, including intangible assets, real estate and inventory. The standard provides that the gain or loss is determined by the difference between the consideration received and the carrying value of the asset. In 2018, there was no impact to our consolidated financial statements from the adoption of this new standard.
Accounting for Modifications of Share-Based Payment Awards––We prospectively adopted the standard, which clarifies that certain changes in the terms or conditions of a share-based payment award be accounted for as a modification. There was no impact to our consolidated financial statements from the adoption of this new standard.
Impacts to our Consolidated Financial Statements––The impacts on our prior period consolidated financial statements of adopting the new standards described above are summarized in the following tables:
Adoption of the standard related to pension and postretirement benefit costs impacted our prior period consolidated statements of income as follows:
 
 
2017
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Effect of Change
Higher/(Lower)

 
As Restated

Cost of sales
 
$
11,240

 
$
(12
)
 
$
11,228

Selling, informational and administrative expenses
 
14,784

 
20

 
14,804

Research and development expenses
 
7,657

 
27

 
7,683

Restructuring charges and certain acquisition-related costs
 
487

 
(136
)
 
351

Other (income)/deductions––net
 
1,315

 
101

 
1,416

Income from continuing operations before provision for taxes on income
 
12,305

 
—

 
12,305

 
 
 
 
 
 
 
 
 
2016
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Effect of Change
Higher/(Lower)

 
As Restated

Cost of sales

$
12,329


$
(7
)

$
12,322

Selling, informational and administrative expenses

14,837


7


14,844

Research and development expenses

7,872


20


7,892

Restructuring charges and certain acquisition-related costs

1,724


(159
)

1,565

Other (income)/deductions––net

3,655


139


3,794

Income from continuing operations before provision for taxes on income

8,351


—


8,351

Adoption of the standards impacted our consolidated balance sheet as follows:
 
 
 
 
Effect of New Accounting Standards Higher/(Lower)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported Balance at December 31, 2017

 
Revenues

 
Financial Assets and Liabilities

 
Income Tax Accounting

 
Reclassification of Certain Tax Effects from AOCI

 
Balance at January 1, 2018

Trade accounts receivable
 
$
8,221

 
$
13

 
$
—

 
$
—

 
$
—

 
$
8,234

Inventories
 
7,578

 
(11
)
 
—

 
—

 
—

 
7,567

Current tax assets
 
3,050

 
(11
)
 
—

 
(3
)
 
—

 
3,036

Noncurrent deferred tax assets and other noncurrent tax assets
 
1,855

 
(17
)
 
—

 
—

 
—

 
1,838

Other noncurrent assets
 
3,227

 
—

 
—

 
(204
)
 
—

 
3,023

Other current liabilities
 
11,115

 
(123
)
 
—

 
—

 
—

 
10,992

Noncurrent deferred tax liabilities
 
3,900

 
106

 
—

 
(18
)
 
—

 
3,988

Other noncurrent liabilities
 
6,149

 
(459
)
 
—

 
—

 
—

 
5,690

Retained earnings
 
85,291

 
450

 
419

 
(189
)
 
495

 
86,466

Accumulated other comprehensive loss
 
(9,321
)
 
—

 
(419
)
 
—

 
(495
)
 
(10,235
)
Adoption of the standards related to the classification of certain transactions in the statements of cash flows and the presentation of restricted cash in the statement of cash flows impacted our consolidated statement of cash flows as follows:
 
 
2017
 
 
 
 
Effect of New Accounting Standards Inflow/(Outflow)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Cash Flow Classification

 
Restricted Cash

 
As Restated

Operating Activities
 
 
 
 
 
 
 
 
Other adjustments, net
 
$
50

 
$
294

 
$
—

 
$
344

Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets
 
(31
)
 
—

 
38

 
7

Investing Activities
 
 
 
 
 
 
 
 
Proceeds from redemptions/sales of short-term investments
 
10,307

 
—

 
(5
)
 
10,302

Proceeds from redemptions/sales of long-term investments
 
3,594

 
—

 
(14
)
 
3,579

Other investing activities, net
 
650

 
21

 
—

 
671

Financing Activities
 
 
 
 
 
 
 
 
Principal payments on short-term borrowings
 
(9,990
)
 
43

 
—

 
(9,947
)
Net proceeds from short-term borrowings with original maturities of three months or less
 
1,401

 
20

 
—

 
1,422

Other financing activities, net
 
(233
)
 
(378
)
 
—

 
(611
)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents
 
(1,254
)
 
—

 
19

 
(1,235
)
Cash and cash equivalents and restricted cash and cash equivalents, beginning
 
2,595

 
—

 
70

 
2,666

Cash and cash equivalents and restricted cash and cash equivalents, ending
 
1,342

 
—

 
89

 
1,431

 
 
 
 
 
 
 
 
 
 
 
2016
 
 
 
 
Effect of New Accounting Standards Inflow/(Outflow)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Cash Flow Classification

 
Restricted Cash

 
As Restated

Operating Activities
 
 
 
 
 
 
 
 
Other adjustments, net
 
$
208

 
$
278

 
$
—

 
$
487

Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets
 
(60
)
 
—

 
13

 
(47
)
Investing Activities
 
 
 
 
 
 
 
 
Proceeds from redemptions/sales of short-term investments
 
29,436

 
—

 
(22
)
 
29,414

Proceeds from redemptions/sales of long-term investments
 
11,254

 
—

 
14

 
11,268

Other investing activities, net
 
51

 
28

 
—

 
80

Financing Activities
 
 
 
 
 
 
 
 
Principal payments on short-term borrowings
 
(5,102
)
 
9

 
—

 
(5,093
)
Net (payments on)/proceeds from short-term borrowings with original maturities of three months or less
 
(3,084
)
 
24

 
—

 
(3,060
)
Other financing activities, net
 
(196
)
 
(340
)
 
—

 
(536
)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents
 
(1,046
)
 
—

 
5

 
(1,041
)
Cash and cash equivalents and restricted cash and cash equivalents, beginning
 
3,641

 
—

 
65

 
3,707

Cash and cash equivalents and restricted cash and cash equivalents, ending
 
2,595

 
—

 
70

 
2,666

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheet that sum to the total of the same amounts shown in the consolidated statements of cash flows:
(MILLIONS OF DOLLARS)
 
December 31, 2018

 
December 31,
2017

Cash and cash equivalents
 
$
1,139

 
$
1,342

Restricted cash and cash equivalents in Short-term investments
 
32

 
—

Restricted cash and cash equivalents in Long-term investments
 
55

 
—

Restricted cash and cash equivalents in Other current assets
 
—

 
14

Restricted cash and cash equivalents in Other noncurrent assets
 
—

 
75

Total cash and cash equivalents and restricted cash and cash equivalents shown in the consolidated balance sheets
 
$
1,225

 
$
1,431


Amounts included in restricted cash represent those required to be set aside by a contractual agreement in connection with ongoing litigation or to secure delivery of Pfizer medicines at the agreed upon terms. The restriction will lapse upon the resolution of the litigation or the proper delivery of the medicines.
C. Estimates and Assumptions

In preparing the consolidated financial statements, we use certain estimates and assumptions that affect reported amounts and disclosures, including amounts recorded and disclosed in connection with acquisitions. These estimates and underlying assumptions can impact all elements of our financial statements. For example, in the consolidated statements of income, estimates are used when accounting for deductions from revenues (such as rebates, chargebacks, sales allowances and sales returns), determining the cost of inventory that is sold, allocating cost in the form of depreciation and amortization, and estimating restructuring charges and the impact of contingencies, as well as determining provisions for taxes on income. On the consolidated balance sheets, estimates are used in determining the valuation and recoverability of assets, such as accounts receivable, investments, inventories, deferred tax assets, fixed assets and intangible assets (including acquired IPR&D assets), and estimates are used in determining the reported amounts of liabilities, such as taxes payable, benefit obligations, accruals for contingencies, rebates, chargebacks, sales allowances and sales returns, and restructuring reserves, all of which also impact the consolidated statements of income.

Our estimates are often based on complex judgments and assumptions that we believe to be reasonable, but that can be inherently uncertain and unpredictable. If our estimates and assumptions are not representative of actual outcomes, our results could be materially impacted.

As future events and their effects cannot be determined with precision, our estimates and assumptions may prove to be incomplete or inaccurate, or unanticipated events and circumstances may occur that might cause us to change those estimates and assumptions. We are subject to risks and uncertainties that may cause actual results to differ from estimated amounts, such as changes in the healthcare environment, competition, litigation, legislation and regulations. We regularly evaluate our estimates and assumptions using historical experience and expectations about the future. We adjust our estimates and assumptions when facts and circumstances indicate the need for change.

For information on estimates and assumptions in connection with the TCJA, see Notes to Consolidated Financial Statements––Note 5A. Tax Matters: Taxes on Income from Continuing Operations.
D. Acquisitions

Our consolidated financial statements include the operations of acquired businesses after the completion of the acquisitions. We account for acquired businesses using the acquisition method of accounting, which requires, among other things, that most assets acquired and liabilities assumed be recognized at their estimated fair values as of the acquisition date and that the fair value of acquired IPR&D be recorded on the balance sheet. Transaction costs are expensed as incurred. Any excess of the consideration transferred over the assigned values of the net assets acquired is recorded as goodwill. When we acquire net assets that do not constitute a business, as defined in U.S. GAAP, no goodwill is recognized and acquired IPR&D is expensed.

Contingent consideration in a business combination is included as part of the acquisition cost and is recognized at fair value as of the acquisition date. Fair value is generally estimated by using a probability-weighted discounted cash flow approach. Any liability resulting from contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved. These changes in fair value are recognized in earnings in Other (income)/deductions––net.

Amounts recorded in connection with an acquisition can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

E. Fair Value

We are often required to measure certain assets and liabilities at fair value, either upon initial recognition or for subsequent accounting or reporting. For example, we use fair value extensively in the initial recognition of net assets acquired in a business combination, when measuring certain impairment losses and when accounting for and reporting of certain financial instruments. We estimate fair value using an exit price approach, which requires, among other things, that we determine the price that would be received to sell an asset or paid to transfer a liability in an orderly market. The determination of an exit price is considered from the perspective of market participants, considering the highest and best use of non-financial assets and, for liabilities, assuming that the risk of non-performance will be the same before and after the transfer.

When estimating fair value, depending on the nature and complexity of the asset or liability, we may use one or all of the following techniques:
•
Income approach, which is based on the present value of a future stream of net cash flows.
•
Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities.
•
Cost approach, which is based on the cost to acquire or construct comparable assets, less an allowance for functional and/or economic obsolescence.

Our fair value methodologies depend on the following types of inputs:
•
Quoted prices for identical assets or liabilities in active markets (Level 1 inputs).
•
Quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are directly or indirectly observable, or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means (Level 2 inputs).
•
Unobservable inputs that reflect estimates and assumptions (Level 3 inputs).

A single estimate of fair value can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

F. Foreign Currency Translation

For most of our international operations, local currencies have been determined to be the functional currencies. We translate functional currency assets and liabilities to their U.S. dollar equivalents at exchange rates in effect as of the balance sheet date and we translate functional currency income and expense amounts to their U.S. dollar equivalents at average exchange rates for the period. The U.S. dollar effects that arise from changing translation rates are recorded in Other comprehensive income/(loss). The effects of converting non-functional currency monetary assets and liabilities into the functional currency are recorded in Other (income)/deductions––net. For operations in highly inflationary economies, we translate monetary items at rates in effect as of the balance sheet date, with translation adjustments recorded in Other (income)/deductions––net, and we translate non-monetary items at historical rates.

G. Revenues and Trade Accounts Receivable

On January 1, 2018, we adopted a new accounting standard for revenue recognition. For further information, see Note 1B.
We recorded direct product sales and/or alliance revenues of more than $1 billion for each of ten products in 2018 and for each of nine products in 2017 and 2016. In the aggregate, these direct products sales and/or alliance product revenues represent 51% of our revenues in 2018, 46% of our revenues in 2017 and 43% of our revenues in 2016. See Note 18C for additional information. The loss or expiration of intellectual property rights can have a significant adverse effect on our revenues as our contracts with customers will generally be at lower selling prices due to added competition and we generally provide for higher sales returns during the period in which individual markets begin to near the loss or expiration of intellectual property rights. Our Consumer Healthcare business includes OTC brands with a focus on dietary supplements, pain management, gastrointestinal and respiratory and personal care. We sell biopharmaceutical products after patent expiration, and under patent, and, to a much lesser extent, consumer healthcare products worldwide to developed and emerging market countries.
Revenue Recognition––We record revenues from product sales when there is a transfer of control of the product from us to the customer. We determine transfer of control based on when the product is shipped or delivered and title passes to the customer.
•
Customers––Our biopharmaceutical products are sold principally to wholesalers but we also sell directly to retailers, hospitals, clinics, government agencies and pharmacies, and, in the case of our vaccine products in the U.S., we primarily sell directly to the CDC, wholesalers, individual provider offices, retail pharmacies and integrated delivery networks. Our consumer healthcare customers include retailers and, to a lesser extent, wholesalers and distributors.
Biopharmaceutical products that ultimately are used by patients are generally covered under governmental programs, managed care programs and insurance programs, including those managed through pharmacy benefit managers, and are subject to sales allowances and/or rebates payable directly to those programs. Those sales allowances and rebates are generally negotiated, but government programs may have legislated amounts by type of product (e.g., patented or unpatented).
•
Our Sales Contracts––Sales on credit are typically under short-term contracts. Collections are based on market payment cycles common in various markets, with shorter cycles in the U.S. Sales are adjusted for sales allowances, chargebacks, rebates and sales returns and cash discounts. Sales returns occur due to loss of exclusivity, product recalls or a changing competitive environment.
•
Deductions from Revenues––Our gross product revenues are subject to a variety of deductions, which generally are estimated and recorded in the same period that the revenues are recognized. Such variable consideration represents chargebacks, rebates, sales allowances and sales returns. These deductions represent estimates of the related obligations and, as such, knowledge and judgment is required when estimating the impact of these revenue deductions on gross sales for a reporting period.
Specifically:
•
In the U.S., we sell our products to distributors and hospitals under our sales contracts. However, we also have contracts with managed care or pharmacy benefit managers and legislatively mandated contracts with the federal and state governments under which we provide rebates to them based on medicines utilized by the lives they cover. We record provisions for Medicare, Medicaid, and performance-based contract pharmaceutical rebates based upon our experience ratio of rebates paid and actual prescriptions written during prior quarters. We apply the experience ratio to the respective period’s sales to determine the rebate accrual and related expense. This experience ratio is evaluated regularly to ensure that the historical trends are as current as practicable. We estimate discounts on branded prescription drug sales to Medicare Part D participants in the Medicare “coverage gap,” also known as the “doughnut hole,” based on the historical experience of beneficiary prescriptions and consideration of the utilization that is expected to result from the discount in the coverage gap. We evaluate this estimate regularly to ensure that the historical trends and future expectations are as current as practicable. For performance-based contract rebates, we also consider current contract terms, such as changes in formulary status and rebate rates.
•
Outside the U.S., the majority of our pharmaceutical sales allowances are contractual or legislatively mandated and our estimates are based on actual invoiced sales within each period, which reduces the risk of variations in the estimation process. In certain European countries, rebates are calculated on the government’s total unbudgeted pharmaceutical spending or on specific product sales thresholds and we apply an estimated allocation factor against our actual invoiced sales to project the expected level of reimbursement. We obtain third-party information that helps us to monitor the adequacy of these accruals.
•
Provisions for pharmaceutical chargebacks (primarily reimbursements to U.S. wholesalers for honoring contracted prices to third parties) closely approximate actual amounts incurred, as we settle these deductions generally within two to five weeks of incurring the liability.
•
Provisions for pharmaceutical sales returns are based on a calculation for each market that incorporates the following, as appropriate: local returns policies and practices; historical returns as a percentage of sales; an understanding of the reasons for past returns; estimated shelf life by product; an estimate of the amount of time between shipment and return or lag time; and any other factors that could impact the estimate of future returns, such as loss of exclusivity, product recalls or a changing competitive environment. Generally, returned products are destroyed, and customers are refunded the sales price in the form of a credit.
•
We record sales incentives as a reduction of revenues at the time the related revenues are recorded or when the incentive is offered, whichever is later. We estimate the cost of our sales incentives based on our historical experience with similar incentives programs to predict customer behavior.
Our accruals for Medicare rebates, Medicaid and related state program rebates, performance-based contract rebates, chargebacks, sales allowances and sales returns and cash discounts totaled $5.4 billion as of December 31, 2018 and $4.9 billion as of December 31, 2017.
The following table provides information about the balance sheet classification of these accruals:
  
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Reserve against Trade accounts receivable, less allowance for doubtful accounts
 
$
1,288

 
$
1,352

 
 
 
 
 
Other current liabilities:
 
 
 
 
Accrued rebates
 
3,208

 
2,674

Other accruals
 
531

 
512

 
 
 
 
 
Other noncurrent liabilities
 
399

 
385

Total accrued rebates and other accruals
 
$
5,426

 
$
4,923


The accrued rebates increased from the prior year-end due to an increase in Medicare rebates driven by increased sales of IH products through this channel.
Amounts recorded for revenue deductions can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

Taxes collected from customers relating to product sales and remitted to governmental authorities are excluded from Revenues.

Trade Accounts Receivable—Trade accounts receivable are stated at their net realizable value. The allowance against gross trade accounts receivable reflects the best estimate of probable losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other current information. Trade accounts receivable are written off after all reasonable means to collect the full amount (including litigation, where appropriate) have been exhausted.

H. Collaborative Arrangements

Payments to and from our collaboration partners are presented in our consolidated statements of income based on the nature of the arrangement (including its contractual terms), the nature of the payments and applicable accounting guidance. Under co-promotion agreements, we record the amounts received from our collaboration partners as alliance revenues, a component of Revenues, when our collaboration partners are the principal in the transaction and we receive a share of their net sales or profits. Alliance revenues are recorded as we perform co-promotion services for the collaboration and the collaboration partners sell the products to their customers within the applicable period. The related expenses for selling and marketing these products are included in Selling, informational and administrative expenses. In collaborative arrangements where we manufacture a product for our collaboration partners, we record revenues when we transfer control of the product to our collaboration partners. In collaboration arrangements where we are the principal in the transaction, we record amounts paid to collaboration partners for their share of net sales or profits earned, and all royalty payments to collaboration partners as Cost of sales. Royalty payments received from collaboration partners are included in Other (income)/deductions—net.
Reimbursements to or from our collaboration partners for development costs are recorded net in Research and development expenses. Upfront payments and pre-approval milestone payments due from us to our collaboration partners in development stage collaborations are recorded as Research and development expenses. Milestone payments due from us to our collaboration partners after regulatory approval has been attained for a medicine are recorded in Identifiable intangible assets—Developed technology rights. Upfront and pre-approval milestone payments earned from our collaboration partners by us are recognized in Other (income)/deductions—net over the development period for the collaboration products, when our performance obligations include providing R&D services to our collaboration partners. Upfront, pre-approval and post-approval milestone payments earned by us may be recognized in Other (income)/deductions—net immediately when earned or over other periods depending upon the nature of our performance obligations in the applicable collaboration. Where the milestone event is regulatory approval for a medicine, we generally recognize milestone payments due to us in the transaction price when regulatory approval in the applicable jurisdiction has been attained. We may recognize milestone payments due to us in the transaction price earlier than the milestone event in certain circumstances when recognition of the income would not be probable of a significant reversal.
On January 1, 2018, we adopted a new accounting standard on revenue recognition (see Note 1B). As a result of the adoption, we recognized the following cumulative effect adjustments related to collaboration arrangements to Retained earnings:
•
$394 million (pre-tax) for collaborative arrangements where upfront, pre-approval and regulatory approval milestone payments received from our collaboration partners are recognized in Other (income)/deductions—net over a reduced period. Under the new standard, the income from upfront and pre-approval milestone payments due to us is typically recognized over the development period for the collaboration when our performance obligation, in addition to granting a license, is to provide R&D services to our collaboration partners, and major regulatory approval milestones are typically recognized immediately when earned as the related development period has ended. The income from upfront and milestone payments is typically recognized immediately as earned if our performance obligation, in addition to granting a license, is only for commercialization activities. Under the old standard, this income was recognized over the combined development and estimated commercialization (including co-promotion) period for the collaboration products.
•
$82 million (pre-tax) for collaborative arrangements where we manufacture products for our collaboration partners and recognize Revenues and Cost of sales for product shipments at an earlier point in time. Under the new standard, revenue is recognized when we transfer control of the products to our collaboration partners. Under the old standard, revenue was recognized when our collaboration partners sell the products and transfer title to their third party customers.

I. Cost of Sales and Inventories

We carry inventories at the lower of cost or net realizable value. The cost of finished goods, work in process and raw materials is determined using average actual cost. We regularly review our inventories for impairment and reserves are established when necessary.

J. Selling, Informational and Administrative Expenses

Selling, informational and administrative costs are expensed as incurred. Among other things, these expenses include the internal and external costs of marketing, advertising, shipping and handling, information technology and legal defense. Advertising expenses totaled approximately $3.1 billion in 2018, $3.1 billion in 2017 and $3.2 billion in 2016. Production costs are expensed as incurred and the costs of radio time, television time and space in publications are expensed when the related advertising occurs.
K. Research and Development Expenses

R&D costs are expensed as incurred. These expenses include the costs of our proprietary R&D efforts, as well as costs incurred in connection with certain licensing arrangements. Before a compound receives regulatory approval, we record upfront and milestone payments made by us to third parties under licensing arrangements as expense. Upfront payments are recorded when incurred, and milestone payments are recorded when the specific milestone has been achieved. Once a compound receives regulatory approval, we record any milestone payments in Identifiable intangible assets, less accumulated amortization and, unless the asset is determined to have an indefinite life, we amortize the payments on a straight-line basis over the remaining agreement term or the expected product life cycle, whichever is shorter.

R&D expenses related to upfront and milestone payments for intellectual property rights totaled $197 million in 2018, $169 million in 2017 and $82 million in 2016. For additional information, see Note 2E.

L. Amortization of Intangible Assets, Depreciation and Certain Long-Lived Assets

Long-lived assets include:
•
Property, plant and equipment, less accumulated depreciation—These assets are recorded at cost and are increased by the cost of any significant improvements after purchase. Property, plant and equipment assets, other than land and construction in progress, are depreciated on a straight-line basis over the estimated useful life of the individual assets. Depreciation begins when the asset is ready for its intended use. For tax purposes, accelerated depreciation methods are used as allowed by tax laws.
•
Identifiable intangible assets, less accumulated amortization—These acquired assets are recorded at fair value. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives. Intangible assets with indefinite lives that are associated with marketed products are not amortized until a useful life can be determined.
•
Goodwill—Goodwill represents the excess of the consideration transferred for an acquired business over the assigned values of its net assets. Goodwill is not amortized.

Amortization expense related to finite-lived acquired intangible assets that contribute to our ability to sell, manufacture, research, market and distribute products, compounds and intellectual property is included in Amortization of intangible assets as these intangible assets benefit multiple business functions. Amortization expense related to intangible assets that are associated with a single function and depreciation of property, plant and equipment are included in Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses, as appropriate.

We review all of our long-lived assets for impairment indicators throughout the year. We perform impairment testing for indefinite-lived intangible assets and goodwill at least annually and for all other long-lived assets whenever impairment indicators are present. When necessary, we record charges for impairments of long-lived assets for the amount by which the fair value is less than the carrying value of these assets.

Specifically:
•
For finite-lived intangible assets, such as developed technology rights, and for other long-lived assets, such as property, plant and equipment, whenever impairment indicators are present, we calculate the undiscounted value of the projected cash flows associated with the asset, or asset group, and compare this estimated amount to the carrying amount. If the carrying amount is found to be greater, we record an impairment loss for the excess of book value over fair value. In addition, in all cases of an impairment review, we re-evaluate the remaining useful lives of the assets and modify them, as appropriate.
•
For indefinite-lived intangible assets, such as Brands and IPR&D assets, when necessary, we determine the fair value of the asset and record an impairment loss, if any, for the excess of book value over fair value. In addition, in all cases of an impairment review other than for IPR&D assets, we re-evaluate whether continuing to characterize the asset as indefinite-lived is appropriate.
•
For goodwill, when necessary, we determine the fair value of each reporting unit and compare that value to its book value. If the carrying amount is found to be greater, we then determine the implied fair value of goodwill by subtracting the fair value of all the identifiable net assets other than goodwill from the fair value of the reporting unit and record an impairment loss, if any, for the excess of the book value of goodwill over the implied fair value.
Impairment reviews can involve a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

M. Restructuring Charges and Certain Acquisition-Related Costs

We may incur restructuring charges in connection with acquisitions when we implement plans to restructure and integrate the acquired operations or in connection with our cost-reduction and productivity initiatives. Included in Restructuring charges and certain acquisition-related costs are all restructuring charges, as well as certain other costs associated with acquiring and integrating an acquired business. If the restructuring action results in a change in the estimated useful life of an asset, that incremental impact is classified in Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses, as appropriate. Termination costs are generally recorded when the actions are probable and estimable. Transaction costs, such as banking, legal, accounting and other similar costs incurred in connection with a business acquisition are expensed as incurred.

Amounts recorded for restructuring charges and other associated costs can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

N. Cash Equivalents and Statement of Cash Flows
On January 1, 2018, we adopted standards related to the classification of certain transactions in the statements of cash flows and the presentation of restricted cash in the statement of cash flow. For further information, see Note 1B.
Cash equivalents include items almost as liquid as cash, such as certificates of deposit and time deposits with maturity periods of three months or less when purchased. If items meeting this definition are part of a larger investment pool, we classify them as Short-term investments.
Cash flows associated with financial instruments designated as fair value or cash flow hedges may be included in operating, investing or financing activities, depending on the classification of the items being hedged. Cash flows associated with financial instruments designated as net investment hedges are classified according to the nature of the hedge instrument. Cash flows associated with financial instruments that do not qualify for hedge accounting treatment are classified according to their purpose and accounting nature.

O. Investments and Derivative Financial Instruments
On January 1, 2018, we adopted new accounting standards for financial assets and liabilities as well as accounting for hedging activities. For further information, see Note 1B.
Our investments are comprised of the following: trading funds and securities, available-for-sale securities, held-to-maturity securities (when we have both the positive intent and ability to hold the investment to maturity) and private equity securities. The classification of an investment can depend on the nature of the investment, our intent and ability to hold the investment, and the degree to which we may exercise influence.
•
Trading securities are carried at fair value, with changes in fair value reported in Other (income)/deductions—net.
•
Available-for-sale debt securities are carried at fair value, with changes in fair value reported in Other comprehensive income/(loss) until realized.
•
Held-to-maturity debt securities are carried at amortized cost.
•
Private equity securities are carried at equity-method or at cost. For additional information, see Note 1B. For equity investments where we have significant influence over the financial and operating policies of the investee, we use the equity-method of accounting. Under the equity-method, we record our share of the investee’s income and expenses in Other (income)/deductions—net. The excess of the cost of the investment over our share of the equity of the investee as of the acquisition date is allocated to the identifiable assets of the investee, with any remaining excess amount allocated to goodwill. Such investments are initially recorded at cost, which typically does not include amounts of contingent consideration.

Realized gains or losses on sales of investments are determined by using the specific identification cost method.

We regularly evaluate all of our financial assets for impairment. For investments in debt and equity securities, when a decline in fair value, if any, is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis in the investment is established.

Derivative financial instruments are carried at fair value in various balance sheet categories (see Note 7A), with changes in fair value reported in Net income or, for derivative financial instruments in certain qualifying hedging relationships, in Other comprehensive income/(loss) (see Note 7F).

A single estimate of fair value and impairment reviews can involve a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

P. Tax Assets and Liabilities and Income Tax Contingencies

On January 1, 2018, we adopted new accounting standards for income tax accounting as well as reclassification of certain tax effects from AOCI. For further information, see Note 1B.
Current tax assets primarily includes income tax receivables that are expected to be recovered either as refunds from taxing authorities or as a reduction to future tax obligations.

Deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates and laws, including the TCJA enacted in December 2017. We provide a valuation allowance when we believe that our deferred tax assets are not recoverable based on an assessment of estimated future taxable income that incorporates ongoing, prudent and feasible tax-planning strategies, that would be implemented, if necessary, to realize the deferred tax assets. All deferred tax assets and liabilities within the same tax jurisdiction are presented as a net amount in the noncurrent section of our consolidated balance sheet.

Other taxes payable in our consolidated balance sheet as of December 31, 2018 includes liabilities for uncertain tax positions and the noncurrent portion of the repatriation tax liability on the deemed repatriated accumulated post-1986 foreign earnings recorded in connection with the TCJA for which we plan to elect, with the filing of our 2018 U.S. Federal Consolidated Income Tax Return, payment over eight years through 2026. See Note 5A for additional information.

We account for income tax contingencies using a benefit recognition model. If we consider that a tax position is more likely than not to be sustained upon audit, based solely on the technical merits of the position, we recognize the benefit. We measure the benefit by determining the amount that is greater than 50% likely of being realized upon settlement, presuming that the tax position is examined by the appropriate taxing authority that has full knowledge of all relevant information.

Under the benefit recognition model, if our initial assessment fails to result in the recognition of a tax benefit, we regularly monitor our position and subsequently recognize the tax benefit: (i) if there are changes in tax law, analogous case law or there is new information that sufficiently raise the likelihood of prevailing on the technical merits of the position to “more likely than not”; (ii) if the statute of limitations expires; or (iii) if there is a completion of an audit resulting in a favorable settlement of that tax year with the appropriate agency. We regularly re-evaluate our tax positions based on the results of audits of federal, state and local and foreign income tax filings, statute of limitations expirations, changes and clarification in tax law or receipt of new information that would either increase or decrease the technical merits of a position relative to the more-likely-than-not standard. Liabilities associated with uncertain tax positions are classified as current only when we expect to pay cash within the next 12 months. Interest and penalties, if any, are recorded in Provision/(benefit) for taxes on income and are classified on our consolidated balance sheet with the related tax liability.

Amounts recorded for valuation allowances and income tax contingencies can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

Q. Pension and Postretirement Benefit Plans

On January 1, 2018, we adopted a new accounting standard for the presentation of net periodic pension and postretirement benefit cost. For further information, see Note 1B.
The majority of our employees worldwide are covered by defined benefit pension plans, defined contribution plans or both. In the U.S., we have both IRC-qualified and supplemental (non-qualified) defined benefit plans and defined contribution plans, as well as other postretirement benefit plans consisting primarily of medical insurance for retirees and their eligible dependents. We recognize the overfunded or underfunded status of each of our defined benefit plans as an asset or liability on our consolidated balance sheet. The obligations are generally measured at the actuarial present value of all benefits attributable to employee service rendered, as provided by the applicable benefit formula. Our pension and other postretirement obligations may include assumptions such as expected employee turnover and participant mortality. For our pension plans, the obligation may also include assumptions as to future compensation levels. For our other postretirement benefit plans, the obligation may include assumptions as to the expected cost of providing medical insurance benefits, as well as the extent to which those costs are shared with the employee or others (such as governmental programs). Plan assets are measured at fair value. Net periodic pension and postretirement benefit costs other than the service costs are recognized in Other (income)/deductions—net.

Amounts recorded for pension and postretirement benefit plans can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

R. Legal and Environmental Contingencies

We and certain of our subsidiaries are subject to numerous contingencies arising in the ordinary course of business, such as patent litigation, product liability and other product-related litigation, commercial litigation, environmental claims and proceedings, government investigations and guarantees and indemnifications. We record accruals for these contingencies to the extent that we conclude that a loss is both probable and reasonably estimable. If some amount within a range of loss appears to be a better estimate than any other amount within the range, we accrue that amount. Alternatively, when no amount within a range of loss appears to be a better estimate than any other amount, we accrue the lowest amount in the range. We record anticipated recoveries under existing insurance contracts when recovery is assured.
Amounts recorded for contingencies can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

S. Share-Based Payments

Our compensation programs can include share-based payments. Generally, grants under share-based payment programs are accounted for at fair value and these fair values are generally amortized on a straight-line basis over the vesting terms into Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses, as appropriate.

Amounts recorded for share-based compensation can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment
 12 Months Ended
Dec. 31, 2018
Business Combinations, Discontinued Operations And Disposal Groups, Collaborative Arrangements And Equity Method Investments [Abstract]  
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment

A. Acquisitions
AstraZeneca’s Small Molecule Anti-Infectives Business (EH)
On December 22, 2016, which fell in the first fiscal quarter of 2017 for our international operations, we acquired the development and commercialization rights to AstraZeneca’s small molecule anti-infectives business, primarily outside the U.S., including the commercialization and development rights to the marketed products Zavicefta™ (ceftazidime-avibactam), Merrem™/Meronem™ (meropenem) and Zinforo™ (ceftaroline fosamil), and the clinical development assets ATM-AVI and CXL (ceftaroline fosamil-AVI). In 2017, under the terms of the agreement, we made payments of approximately $605 million to AstraZeneca related to the transaction. We made an additional milestone payment of $125 million in our first fiscal quarter of 2018 and we made a deferred payment of $175 million to AstraZeneca in January 2019. In addition, we may be required to pay an additional milestone payment of $75 million if the related milestone is achieved prior to December 31, 2021, and up to $600 million if sales of Zavicefta™ exceed certain thresholds prior to January 1, 2026, as well as tiered royalties on sales of Zavicefta™ and ATM-AVI in certain markets for a period ending on the later of 10 years from first commercial sale or the loss of patent protection or loss of regulatory exclusivity. The total royalty payments are unlimited during the royalty term and the undiscounted payments are expected to be in the range of approximately $327 million to $553 million. The total fair value of consideration transferred for AstraZeneca’s small molecule anti-infectives business was approximately $1,040 million inclusive of cash paid of $555 million and the fair value of contingent consideration of $485 million (which is composed of the deferred payment, the $50 million milestone payment made in the second quarter of 2017, the $125 million milestone payment made in our first fiscal quarter of 2018 and the future expected milestone and royalty payments). In connection with this acquisition, we recorded $894 million in Identifiable intangible assets, consisting of $728 million in Developed technology rights and $166 million in IPR&D. We also recorded $92 million in Other current assets related to the economic value of inventory which was retained by AstraZeneca for sale on our behalf, $73 million in Goodwill and $19 million of net deferred tax liabilities. The final allocation of the consideration transferred to the assets acquired and the liabilities assumed has been completed.

Medivation, Inc. (IH)
On September 28, 2016, we acquired Medivation for $81.50 per share. The total fair value of consideration transferred for Medivation was approximately $14.3 billion in cash ($13.9 billion, net of cash acquired). Of this consideration, approximately $365 million was not paid as of December 31, 2016, and was recorded in Other current liabilities. The remaining consideration was paid as of December 31, 2017. Medivation is a wholly-owned subsidiary of Pfizer. Medivation is a biopharmaceutical company focused on developing and commercializing small molecules for oncology. Medivation’s portfolio includes Xtandi (enzalutamide), an androgen receptor inhibitor that blocks multiple steps in the androgen receptor signaling pathway within tumor cells. Xtandi is approved for the treatment of castration-resistant prostate cancer. In the third quarter of 2018, upon the approval of Xtandi in the U.S. for the treatment of men with non-metastatic castration-resistant prostate cancer, we transferred the remaining IPR&D value of Xtandi to Developed technology rights (see Note 10A). Xtandi is being developed and commercialized through a collaboration with Astellas. Astellas has exclusive commercialization rights for Xtandi outside the U.S. The Medivation portfolio also includes talazoparib, which was approved by the FDA in October 2018, under the trade name Talzenna, for the treatment of adults with germline BRCA-mutated HER2-negative locally advanced or metastatic breast cancer and is currently in development for other types of cancer. In connection with this acquisition, we recorded $12.2 billion in Identifiable intangible assets, primarily consisting of $8.1 billion of Developed technology rights with an average useful life of approximately 12 years and $4.1 billion of IPR&D, and recorded $6.1 billion of Goodwill, $4.0 billion of net income tax liabilities, and $259 million of assumed contingent consideration of which $35 million has been paid through December 31, 2018. In 2017 and 2016, we recorded measurement period adjustments to the estimated fair values initially recorded in 2016, which resulted in a reduction in Identifiable intangible assets of approximately $1.0 billion with a corresponding change to Goodwill and net income tax liabilities. The measurement period adjustments were recorded to better reflect market participant assumptions about facts and circumstances existing as of the acquisition date. The 2017 results included a decrease of approximately $38 million to Amortization of intangible assets which reflected the cumulative pre-tax impact of the measurement period adjustments to Identifiable intangible assets that were amortized to the income statement since the acquisition date. The measurement period adjustments did not result from intervening events subsequent to the acquisition date. The final allocation of the consideration transferred to the assets acquired and the liabilities assumed has been completed.
Bamboo Therapeutics, Inc. (IH)
On August 1, 2016, we acquired all the remaining equity in Bamboo, a privately-held biotechnology company focused on developing gene therapies for the potential treatment of patients with certain rare diseases relating to neuromuscular conditions and those affecting the central nervous system, for $150 million, plus potential milestone payments of up to $495 million contingent upon the progression of key assets through development, regulatory approval and commercialization. The total fair value of the consideration transferred for Bamboo was approximately $343 million, including cash of $130 million ($101 million, net of cash acquired), contingent consideration of $167 million, consisting of milestone payments, and the fair value of Pfizer’s previously held equity interest in Bamboo of $45 million. We previously purchased a minority stake in Bamboo in the first quarter of 2016 for a payment of approximately $43 million. Upon acquiring the remaining interest in Bamboo in the third quarter of 2016, we recognized a gain of $2 million on our existing investment in Other (income)/deductions––net over the one-year allocation period. This acquisition provides us with several clinical and pre-clinical assets that complement our rare disease portfolio, an advanced recombinant Adeno-associated virus vector design and production technology, and a fully functional Phase I/II gene therapy manufacturing facility. Bamboo is a wholly-owned subsidiary of Pfizer. In connection with this acquisition, we recorded $330 million of Identifiable intangible assets, consisting entirely of IPR&D. We also recorded $142 million of Goodwill and $94 million of net deferred tax liabilities. The final allocation of the consideration transferred to the assets acquired and the liabilities assumed has been completed.

Anacor Pharmaceuticals, Inc. (IH)
On June 24, 2016, we acquired Anacor for $99.25 per share. The total fair value of consideration transferred for Anacor was approximately $4.9 billion in cash ($4.5 billion net of cash acquired), plus $698 million debt assumed. Anacor is a wholly-owned subsidiary of Pfizer. Anacor is a biopharmaceutical company focused on novel small-molecule therapeutics derived from its boron chemistry platform. Anacor’s crisaborole, a non-steroidal topical PDE-4 inhibitor with anti-inflammatory properties, was approved by the FDA in December 2016 under the trade name, Eucrisa. In connection with this acquisition, we recorded $698 million as the fair value of notes payable in cash, and recorded $4.9 billion in Identifiable intangible assets, primarily consisting of $4.8 billion of IPR&D, and recorded $646 million of Goodwill and $346 million of net income tax liabilities. The final allocation of the consideration transferred to the assets acquired and the liabilities assumed has been completed.

B. Divestitures
Sale of Hospira Infusion Systems Net Assets to ICU Medical, Inc. (EH)
On October 6, 2016, we announced that we entered into a definitive agreement under which ICU Medical agreed to acquire all of our global infusion systems net assets, HIS, for approximately $1 billion in cash and ICU Medical common stock. HIS includes IV pumps, solutions, and devices. As a result of the performance of HIS relative to ICU Medical’s expectations, on January 5, 2017 we entered into a revised agreement with ICU Medical under which ICU Medical would acquire HIS for up to approximately $900 million, composed of cash and contingent cash consideration, ICU Medical common stock and seller financing.
The revised transaction closed on February 3, 2017. At closing, we received 3.2 million newly issued shares of ICU Medical common stock (as originally agreed), which we initially valued at approximately $428 million (based upon the closing price of ICU Medical common stock on the closing date less a discount for lack of marketability) and which were reported as equity securities at fair value in Long-term investments on the consolidated balance sheet as of December 31, 2017. Upon the sale of these shares in 2018, we realized a full gain of $302 million on these securities, although our income statement only reflects a gain of $47 million as the balance of the previously unrealized gain was recorded as a cumulative effect adjustment upon the adoption of a new accounting standard (see Note 1B). We also received a promissory note in the amount of $75 million, which was repaid in full as of December 31, 2017, and net cash of approximately $200 million before customary adjustments for net working capital, which is reported in Other investing activities, net on the consolidated statement of cash flows for the year-ended December 31, 2017. In addition, we are entitled to receive a contingent amount of up to an additional $225 million in cash based on ICU Medical’s achievement of certain cumulative performance targets for the combined company through December 31, 2019. We recognized a pre-tax gain of approximately $1 million in 2018 and pre-tax losses of $55 million in 2017 in Other (income)/deductions––net, representing adjustments to amounts previously recorded in 2016 to write down the HIS net assets to fair value less costs to sell. For additional information, see Note 4.
The sale of the HIS net assets was fully completed in all jurisdictions as of year-end 2018.
In connection with the sale transaction, we entered into certain transitional agreements designed to facilitate the orderly transition of the HIS net assets to ICU Medical. These agreements primarily related to administrative services, and were provided for a period of 24 months after the closing date. We will also manufacture and supply certain HIS products for ICU Medical and ICU Medical will manufacture and supply certain retained Pfizer products for us after closing, generally for a term of five years. These agreements are not material to Pfizer and none confers upon us the ability to influence the operating and/or financial policies of ICU Medical subsequent to the sale.
At December 31, 2016, we determined that the carrying value of the HIS net assets held for sale exceeded their fair value less estimated costs to sell, resulting in a pre-tax impairment charge of $1.7 billion, which is included in Other (income)/deductions––net for the year ended December 31, 2016 (see Note 4). The decline in value resulted from lower expectations as to future cash flows to be generated by HIS, primarily as a result of an increase in competition for customer contracts and pricing factors that were not initially anticipated.

Contribution Agreement Between Pfizer and Allogene Therapeutics, Inc. (WRD)
In April 2018, Pfizer and Allogene announced that the two companies entered into a contribution agreement for Pfizer’s portfolio of assets related to allogeneic CAR T therapy, an investigational immune cell therapy approach to treating cancer. Under this agreement, Allogene received from Pfizer rights to pre-clinical and clinical CAR T assets, all of which were previously licensed to Pfizer from French cell therapy company, Cellectis, beginning in 2014 and French pharmaceutical company, Servier, beginning in 2015. Allogene assumed responsibility for all potential financial obligations to both Cellectis and Servier. Pfizer will continue to participate financially in the development of the CAR T portfolio through an ownership stake in Allogene. Separately, Pfizer continues to maintain its approximate 7% ownership stake in Cellectis that was obtained in 2014 as part of the licensing agreement in which Pfizer obtained exclusive rights to pursue the development and commercialization of certain Cellectis CAR T therapies in exchange for an upfront payment of $80 million, as well as potential future development, regulatory and commercial milestone payments and royalties. In connection with the Allogene transaction, Pfizer recognized a non-cash $50 million pre-tax gain in Other (income)/deductions––net in the second quarter of 2018, representing the difference between the $127 million fair value of the equity investment received and the book value of assets transferred (including an allocation of goodwill) (see Note 4).
In October 2018, Allogene consummated an initial public offering of new shares of its common stock, which resulted in Pfizer’s preferred stock converting into common stock and a decrease in our ownership percentage from approximately 25% to approximately 18% as of December 31, 2018. The closing price on the day of the initial public offering was $25 per share. Beginning as of the date of the initial public offering, our investment in Allogene is being measured at fair value with changes in fair value recognized in net income (see Note 4).
Sale of Phase 2b Ready AMPA Receptor Potentiator for CIAS to Biogen Inc. (WRD)
In April 2018, we sold our Phase 2b ready AMPA receptor potentiator for CIAS to Biogen. We received $75 million upfront and have the opportunity to receive up to $515 million in future development and commercialization milestones, as well as tiered royalties in the low-to-mid-teen percentages. We recognized the $75 million upfront payment in Other (income)/deductions––net in the second quarter of 2018 (see Note 4). In the fourth quarter of 2018, we recognized an additional $10 million milestone in Other (income)/deductions––net (see Note 4). We will record the other milestones and royalties to Other (income)/deductions––net when due, or earlier if we have sufficient experience to determine such amounts are not probable of significant reversal.
Divestiture of Neuroscience Assets (WRD)
In September 2018, we and Bain Capital entered into a transaction to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system including Parkinson’s disease, epilepsy, Alzheimer’s disease, schizophrenia and addiction. These assets were part of the neuroscience discovery and early development efforts, which we announced we were ending in January 2018. In connection with this transaction, we out-licensed the portfolio to Cerevel in exchange for a 25% ownership stake in Cerevel’s parent company, Cerevel Therapeutics, Inc., and potential future regulatory and commercial milestone payments and royalties. Bain Capital has committed to invest $350 million to develop the portfolio, with the potential for additional funding as the assets advance. In connection with the transaction, we recognized a non-cash $343 million pre-tax gain in Other (income)/deductions––net in the third quarter of 2018, representing the fair value of the equity investment received as the assets transferred had a book value of $0 (see Note 4). Our investment in Cerevel Therapeutics, Inc. is reported in Long-term investments on the consolidated balance sheet as of December 31, 2018.
C. Assets and Liabilities Held for Sale
On December 19, 2018, we announced that we entered into a definitive agreement with GSK under which we and GSK have agreed to combine our respective consumer healthcare businesses into a new consumer healthcare joint venture that will operate globally under the GSK Consumer Healthcare name. In exchange for contributing our Consumer Healthcare business, we will receive a 32% equity stake in the company and GSK will own the remaining 68%. The transaction is expected to close in the second half of 2019, subject to customary closing conditions including GSK shareholder approval and required regulatory approvals. Upon the closing of the transaction, we will deconsolidate our Consumer Healthcare business and recognize a gain for the difference in the fair value of our 32% equity stake in the company and the carrying value of our Consumer Healthcare business. We will account for our 32% equity stake in the company after closing of the transaction as an equity-method investment. Assets and liabilities associated with our Consumer Healthcare business were reclassified as held for sale in the consolidated balance sheet as of December 31, 2018. The Consumer Healthcare business assets held for sale are reported in Assets held for sale and Consumer Healthcare business liabilities held for sale are reported in Liabilities held for sale. This includes the Consumer Healthcare business tax assets and liabilities related to fully dedicated consumer healthcare subsidiaries. The amounts associated with the Consumer Healthcare business, as well as other assets classified as held for sale consisted of the following:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Assets Held for Sale
 
 
 
 
Cash and cash equivalents
 
$
32

 
$
—

Trade accounts receivable, less allowance for doubtful accounts
 
532

 
—

Inventories
 
538

 
—

Other current assets
 
56

 
—

PP&E
 
675

 
—

Identifiable intangible assets, less accumulated amortization
 
5,763

 
—

Goodwill
 
1,972

 
—

Noncurrent deferred tax assets and other noncurrent tax assets
 
54

 
—

Other noncurrent assets
 
57

 
—

Total Consumer assets held for sale
 
9,678

 
—

Other assets held for sale(a)
 
46

 
12

Assets held for sale
 
$
9,725

 
$
12

 
 
 
 
 
Liabilities Held for Sale
 
 
 
 
 
 
 
 
 
Trade accounts payable
 
$
406

 
$
—

Income taxes payable
 
39

 
—

Accrued compensation and related items
 
93

 
—

Other current liabilities
 
353

 
—

Pension benefit obligations, net
 
39

 
—

Postretirement benefit obligations, net
 
33

 
—

Noncurrent deferred tax liabilities
 
870

 
—

Other noncurrent liabilities
 
56

 
—

Total Consumer liabilities held for sale
 
$
1,890

 
$
—

(a) 
Other assets held for sale consist of PP&E.
As a part of Pfizer, pre-tax income on a management business unit basis for the Consumer Healthcare business was $977 million in 2018, $863 million in 2017 and $780 million in 2016.
D. Licensing Arrangements
Shire International GmbH (IH)
In 2016, we out-licensed PF-00547659, an investigational biologic being evaluated for the treatment of moderate-to-severe inflammatory bowel disease, including ulcerative colitis and Crohn’s disease, to Shire for an upfront payment of $90 million, up to $460 million in development and sales-based milestone payments and potential future royalty payments on commercialized products. The $90 million upfront payment was initially deferred and recognized in Other (income)/deductions––net ratably through December 2017. In the first quarter of 2018, we recognized $75 million in Other (income)/deductions––net for a milestone payment received from Shire related to their first dosing of a patient in a Phase 3 clinical trial of the compound for the treatment of ulcerative colitis, and in the third quarter of 2018, we recognized $35 million in Other (income)/deductions––net for a milestone payment received from Shire related to their first dosing of a patient in a Phase 3 clinical trial of the compound for the treatment of Crohn’s disease (see Note 4).
BionTech AG (WRD)
In August 2018, a multi-year R&D arrangement went into effect between BionTech AG (BionTech), a privately held company, and Pfizer to develop mRNA-based vaccines for prevention of influenza (flu). In September 2018, we made an upfront payment of $50 million to BionTech, which was recorded in Research and development expenses, and BionTech is eligible to receive up to an additional $325 million in future development and sales based milestones and future royalty payments associated with worldwide sales. As part of the transaction, we also purchased 169,670 newly-issued ordinary shares of BionTech for $50 million in the third quarter of 2018, which are reported in Long-term investments in the consolidated balance sheet as of December 31, 2018.
E. Research and Development and Collaborative Arrangements
We adopted a new accounting standard for revenue recognition and changed our accounting policies with respect to collaborative arrangements accordingly. For additional information, see Note 1B.
Research and Development Arrangement with NovaQuest Co-Investment Fund II, L.P.
On November 1, 2016, we announced the discontinuation of the global clinical development program for bococizumab. During December 2016, $31.3 million was refunded to NovaQuest representing amounts NovaQuest prepaid for development costs (under the May 2016 agreement described below) that were not used for program expenses due to the discontinuation of the development program. No additional payments have been or are expected to be received from or paid to NovaQuest with respect to this agreement, which was terminated effective as of November 18, 2016.
In May 2016, our agreement with NovaQuest became effective, under which NovaQuest agreed to fund up to $250 million in development costs related to certain Phase 3 clinical trials of Pfizer’s bococizumab compound and Pfizer agreed to use commercially reasonable efforts to develop and obtain regulatory approvals for such compound. NovaQuest’s development funding was expected to cover up to 40% of the development costs and was to be received over five quarters during 2016 and 2017. As there was a substantive and genuine transfer of risk to NovaQuest, the development funding applicable to program expenses during 2016 was recognized as an obligation to perform contractual services and therefore has been recognized as a reduction of Research and development expenses as incurred. The reduction to Research and development expenses for 2016 totaled $180.3 million.
Research and Development Arrangement with NovaQuest Co-Investment Fund V, L.P.
In April 2016, Pfizer entered into an agreement with NovaQuest under which NovaQuest would fund up to $200 million in development costs related to certain Phase 3 clinical trials of Pfizer’s rivipansel compound and Pfizer will use commercially reasonable efforts to develop and obtain regulatory approvals for such compound. NovaQuest’s development funding is expected to cover up to 100% of the development costs and will be received over approximately 13 quarters from 2016 through the second quarter of 2019 after which Pfizer will be responsible for the remaining development costs. As there is a substantive and genuine transfer of risk to NovaQuest, the development funding is recognized by us as an obligation to perform contractual services and therefore is a reduction of Research and development expenses as incurred. The reduction to Research and development expenses totaled $57.6 million for 2018, $72.1 million for 2017 and $46.6 million for 2016. Following potential regulatory approval, NovaQuest will be eligible to receive a combination of fixed milestone payments of up to approximately $267 million in total, based on achievement of first commercial sale and certain levels of cumulative net sales as well as royalties on rivipansel net sales over approximately eight years. Fixed sales-based milestone payments will be recorded as intangible assets and amortized to Amortization of intangible assets over the estimated commercial life of the rivipansel product and royalties on net sales will be recorded as Cost of sales when incurred.
Research and Development Arrangement with RPI Finance Trust
In January 2016, Pfizer entered into an agreement with RPI, a subsidiary of Royalty Pharma, under which RPI would fund up to $300 million in development costs related to certain Phase 3 clinical trials of Pfizer’s Ibrance (palbociclib) product primarily for adjuvant treatment of hormone receptor positive early breast cancer (the Indication). RPI’s development funding is expected to cover up to 100% of the costs primarily for the applicable clinical trials until the second quarter of 2020 after which Pfizer will be responsible for the remaining cost of the trials. As there is a substantive and genuine transfer of risk to RPI, the development funding is recognized by us as an obligation to perform contractual services and therefore is a reduction of Research and development expenses as incurred. The reduction to Research and development expenses totaled $99.3 million for 2018, $75.6 million for 2017 and $44.9 million for 2016. If successful and upon approval of Ibrance in the U.S. or certain major markets in the EU for the Indication based on the applicable clinical trials, RPI will be eligible to receive a combination of approval-based fixed milestone payments of up to $250 million dependent upon results of the clinical trials and royalties on certain Ibrance sales over approximately seven years. Fixed milestone payments due upon approval will be recorded as intangible assets and amortized to Amortization of intangible assets over the estimated commercial life of the Ibrance product and sales-based royalties will be recorded as Cost of sales when incurred.
Collaborative Arrangements
In the normal course of business, we enter into collaborative arrangements with respect to in-line medicines, as well as medicines in development that require completion of research and regulatory approval. Collaborative arrangements are contractual agreements with third parties that involve a joint operating activity, typically a research and/or commercialization effort, where both we and our partner are active participants in the activity and are exposed to the significant risks and rewards of the activity. Our rights and obligations under our collaborative arrangements vary. For example, we have agreements to co-promote pharmaceutical products discovered by us or other companies, and we have agreements where we partner to co-develop and/or participate together in commercializing, marketing, promoting, manufacturing and/or distributing a drug product.
The following table provides the amounts and classification of payments (income/(expense)) between us and our collaboration partners:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Revenues—Revenues(a)
 
$
571

 
$
606

 
$
659

Revenues—Alliance revenues(b)
 
3,838

 
2,927

 
1,746

Total revenues from collaborative arrangements
 
4,409

 
3,533

 
2,405

Cost of sales(c)
 
(296
)
 
(329
)
 
(315
)
Selling, informational and administrative expenses(d)
 
(90
)
 
(54
)
 
(5
)
Research and development expenses(e)
 
162

 
222

 
64

Other income/(deductions)—net(f)
 
281

 
249

 
542

(a) 
Represents sales to our partners of products manufactured by us.
(b) 
Substantially all relates to amounts earned from our partners under co-promotion agreements. The increases in 2018 and 2017 reflect increases in alliance revenues from Eliquis and Xtandi.
(c) 
Primarily relates to amounts paid to collaboration partners for their share of net sales or profits earned in collaboration arrangements where we are the principal in the transaction, and cost of sales associated with inventory purchased from our partners.
(d) 
Represents net reimbursements to our partners for selling, informational and administrative expenses incurred.
(e) 
Primarily relates to upfront payments and pre-approval milestone payments earned by our partners as well as net reimbursements. The upfront and milestone payments were as follows: $50 million in 2018, $15 million in 2017 and $15 million in 2016. Our collaboration with Lilly (see below) also includes reimbursements of $98 million in 2018, $147 million in 2017 and $120 million in 2016.
(f) 
Primarily relates to royalties from our collaboration partners. The decrease in 2017 is due to the October 31, 2016 expiration of our 36 month royalty arrangement on sales of Enbrel in the U.S. and Canada, partially offset by a full year of royalties earned in 2017, versus a partial year in 2016, on Xtandi ex-U.S. sales.
The amounts disclosed in the above table do not include transactions with third parties other than our collaboration partners, or other costs associated with the products under the collaborative arrangements.
In addition, in connection with our collaborative arrangements, we paid post-approval milestones of $140 million in 2017 related to our collaboration with Merck KGaA (see below). These payments were recorded in Identifiable intangible assets––Developed technology rights. We did not pay post-approval milestones to collaboration partners in 2018 or 2016. We also recorded milestones earned related to our collaboration with Merck (see below) of $40 million in 2018 to Other (income)/deductions––net and $150 million in 2017, substantially all of which was included in the adjustment to increase the opening balance of Retained earnings upon the adoption of a new accounting standard for revenue recognition, effective January 1, 2018 (see Note 1B).

Collaboration with Merck & Co., Inc. (IH)

Under a worldwide collaboration agreement, except for Japan, we collaborated with Merck on the clinical development of ertugliflozin and ertugliflozin-containing fixed-dose combinations with metformin and Januvia (sitagliptin) tablets, which were approved by the FDA in December 2017 and the European Commission in March 2018 as Steglatro, Segluromet and Steglujan. Merck exclusively promotes Steglatro and the two fixed-dose combination products and we share revenues and certain costs with Merck on a 60%/40% basis, with Pfizer having the 40% share.
In the first quarter of 2017, we received a $90 million milestone payment from Merck upon the FDA’s acceptance for review of the NDAs for ertugliflozin and two fixed-dose combinations (ertugliflozin plus Januvia (sitagliptin) and ertugliflozin plus metformin), which, as of December 31, 2017, was deferred and primarily reported in Other noncurrent liabilities, and through December 31, 2017, was being recognized in Other (income)/deductions––net over a multi-year period. As of December 31, 2017, we were due a $60 million milestone payment from Merck, which we received in the first quarter of 2018, in conjunction with the approval of ertugliflozin by the FDA. As of December 31, 2017, the $60 million due from Merck was deferred and primarily reported in Other noncurrent liabilities. In the first quarter of 2018, in connection with the approval of ertugliflozin in the EU, we recognized a $40 million milestone payment from Merck in Other (income)/deductions––net (see Note 4). We are eligible for additional payments associated with the achievement of future commercial milestones. In the first quarter of 2018, in connection with the adoption of a new accounting standard, as of January 1, 2018, the $60 million of deferred income and approximately $85 million of the $90 million of deferred income associated with the above-mentioned milestone payments were recorded to and included in the $584 million cumulative effect adjustment to Retained earnings. See Note 1B for additional information.
Collaboration with Eli Lilly & Company (IH)

In 2013, we entered into a collaboration agreement with Lilly to jointly develop and globally commercialize Pfizer’s tanezumab, which provides that Pfizer and Lilly will equally share product-development expenses as well as potential revenues and certain product-related costs. We received a $200 million upfront payment from Lilly in accordance with the collaboration agreement between Pfizer and Lilly, which was deferred and primarily reported in Other noncurrent liabilities, and through December 31, 2017, was being recognized in Other (income)/deductions––net over a multi-year period beginning in the second quarter of 2015. Pfizer and Lilly resumed the Phase 3 chronic pain program for tanezumab in July 2015. The FDA granted Fast Track designation for tanezumab for the treatment of chronic pain in patients with osteoarthritis A and chronic low back pain in June 2017. Under the collaboration agreement with Lilly, we are eligible to receive additional payments from Lilly upon the achievement of specified regulatory and commercial milestones. In the first quarter of 2018, in connection with the adoption of a new accounting standard, as of January 1, 2018, approximately $107 million of deferred income associated with the above-mentioned upfront payment was recorded to and included in the $584 million cumulative effect adjustment to Retained earnings. See Note 1B for additional information. Approximately $37 million of the upfront payment continues to be deferred, of which approximately $30 million is reported in Other current liabilities and approximately $8 million is reported in Other noncurrent liabilities as of December 31, 2018. This amount is expected to be recognized in Other (income)/deductions––net over the remaining development period for the product between 2019 and 2020.
Collaboration with Merck KGaA (IH)

In November 2014, we entered into a collaborative arrangement with Merck KGaA, to jointly develop and commercialize avelumab, currently approved as Bavencio for metastatic MCC and for patients with locally advanced or metastatic UC in certain countries and in development as a potential treatment for multiple other types of cancer. We and Merck KGaA are exploring the therapeutic potential of this novel anti-PD-L1 antibody as a single agent as well as in various combinations with our and Merck KGaA’s broad portfolio of approved and investigational oncology therapies. Also, as part of the agreement, we gave Merck KGaA certain co-promotion rights for Xalkori in the U.S. and several other key markets. Under the terms of the agreement, in the fourth quarter of 2014, we made an upfront payment of $850 million to Merck KGaA and Merck KGaA is eligible to receive regulatory and commercial milestone payments of up to approximately $2.0 billion. During 2017, we made $140 million in milestone payments to Merck KGaA, which were recorded in Identifiable intangible assets––Developed technology rights, for approvals of avelumab received in 2017 for the MCC indication in the U.S., the EU and Japan, and for the metastatic UC indication in the U.S. Both companies jointly fund the majority of development and commercialization costs, and split equally any profits generated from selling any products containing avelumab from this collaboration. In September 2018, the companies announced positive top-line results from the pivotal Phase 3 JAVELIN Renal 101 study evaluating Bavencio (avelumab) in combination with Inlyta (axitinib), compared with Sutent (sunitinib) as initial therapy for patients with advanced RCC. In December 2018, both companies amended the collaborative agreement such that Pfizer will be solely responsible for the development and commercialization of its anti PD-1 antibody. Under the terms of the amended agreement, Pfizer paid Merck KGaA an up-front payment and we will make a potential milestone and tiered royalty payments should the Pfizer anti PD-1 antibody achieve regulatory and commercial success.

F. Equity-Method Investments

Investment in Hisun Pfizer Pharmaceuticals Company Limited (EH)

In September 2012, we and Hisun, a leading pharmaceutical company in China, formed a new company, Hisun Pfizer, to develop, manufacture, market and sell pharmaceutical products, primarily branded generic products, predominately in China. Hisun Pfizer was established with registered capital of $250 million, of which our portion was $122.5 million. As a result of the contributions from both parties, Hisun Pfizer holds a broad portfolio of branded generics covering cardiovascular disease, infectious disease, oncology, mental health and other therapeutic areas.

We accounted for our interest in Hisun Pfizer as an equity-method investment, due to the significant influence we had over the operations of Hisun Pfizer through our board representation, minority veto rights and 49% voting interest. Our investment in Hisun Pfizer was reported in Long-term investments, and our share of Hisun Pfizer’s net income was recorded in Other (income)/deductions––net.

On November 10, 2017, we sold our 49% equity share in Hisun Pfizer to Sapphire I (HK) Holdings Limited, an investment fund managed by Hillhouse Capital, for a total of $286 million in cash which included our carrying value of $270 million in cash plus $16 million to cover certain taxes incurred on the transaction. As a result of the sale transaction, we recognized a loss of $81 million in the fourth quarter of 2017 for the recognition in earnings of the currency translation adjustment associated with our investment. After the sale transaction, Hisun Pfizer changed its name but retained its current rights to manufacture, sell and distribute all of Hisun Pfizer’s currently marketed and pipeline products in China. We are providing technical, manufacturing and regulatory services in connection with a technology transfer process being run by Hisun Pfizer to support Hisun Pfizer’s objective that the products that we had previously licensed to Hisun Pfizer, will in the future, be manufactured locally in China. We continue to supply certain products to Hisun Pfizer for a period of time, after the sale transaction, to facilitate a smooth transition.
In 2016, we determined that we had other-than-temporary declines in the value of Hisun Pfizer, and, therefore, we recognized a loss of $452 million in Other (income)/deductions––net (see Note 4), consisting of losses recognized in the first, second and fourth quarters of 2016. In the first and second quarters of 2016, we determined that we had other-than-temporary declines in the value of Hisun Pfizer and, therefore, we recognized a loss of $81 million and $130 million, respectively. The declines in value resulted from lower expectations as to the future cash flows to be generated by Hisun Pfizer, primarily as a result of an increase in risk due to the continued slowdown in the Chinese economy and changes in the expected timing and number of new product introductions by Hisun Pfizer. In the fourth quarter of 2016, we recognized a loss of $241 million to reduce the carrying value of our investment in Hisun Pfizer to approximately $270 million at December 31, 2016.
In valuing our investment in Hisun Pfizer, we used discounted cash flow techniques, reflecting our best estimate of the various risks inherent in the projected cash flows, and a nominal terminal year growth factor. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which include the expected impact of competitive, legal, economic and/or regulatory forces on the products; the long-term growth rate, which seeks to project the sustainable growth rate over the long-term; and the discount rate, which seeks to reflect the various risks inherent in the projected cash flows, including country risk.

Investment in Laboratório Teuto Brasileiro S.A. (EH)

We entered into an agreement on June 30, 2017 to exit our investment in Teuto, a 40%-owned generics company in Brazil, and sell our 40% interest in Teuto to the majority shareholders. As part of the agreement, we waived our option to acquire the remaining 60% of Teuto, and Teuto’s other shareholders have waived their option to sell their 60% stake in the company to us. As a result, in the second quarter of 2017, we recognized a net loss of approximately $30 million in Other (income)/deductions––net (see Note 4), which included the impairment of our equity-method investment in Teuto, the reversal of a contingent liability associated with the majority shareholders’ option to sell their 60% stake in the company to us, and the recognition in earnings of the currency translation adjustment associated with the Teuto investment. The transaction closed on August 16, 2017.

In 2016, we determined that we had an other-than-temporary decline in the value of Teuto, and, therefore, in 2016, we recognized a loss of $50 million in Other (income)/deductions––net (see Note 4) related to our equity-method investment. The decline in value resulted from lower expectations as to the future cash flows to be generated by Teuto, primarily due to a slowdown in Brazilian economic conditions, which have been impacted by political risk, higher inflation, and the depreciation of the Brazilian Real.

In valuing our investment in Teuto, we used discounted cash flow techniques, reflecting our best estimate of the various risks inherent in the projected cash flows, and a nominal terminal year growth factor. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which include the expected impact of competitive, legal, economic and/or regulatory forces on the products; the long-term growth rate, which seeks to project the sustainable growth rate over the long-term; and the discount rate, which seeks to reflect the various risks inherent in the projected cash flows, including country risk.

G. Privately Held Investment

AM-Pharma B.V. (WRD)

In April 2015, we acquired a minority equity interest in AM-Pharma, a privately-held Dutch biopharmaceutical company focused on the development of human recombinant Alkaline Phosphatase (recAP) for inflammatory diseases, and secured an exclusive option to acquire the remaining equity in the company. The option became exercisable after completion of a Phase 2 trial of recAP for the treatment of Acute Kidney Injury related to sepsis in the first quarter of 2018. We declined to exercise the option and the option expired unexercised during the second quarter of 2018. Under the terms of the agreement, we originally paid $87.5 million for both the exclusive option and the minority equity interest, which was recorded as a cost-method investment in Long-term investments. During the fourth quarter of 2017, we recognized a loss of $43 million in Other (income)/deductions––net (see Note 4) for an impairment of our long-term investment.
v3.10.0.1
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives
 12 Months Ended
Dec. 31, 2018
Restructuring and Related Activities [Abstract]  
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives

We incur significant costs in connection with acquiring, integrating and restructuring businesses and in connection with our global cost-reduction/productivity initiatives. For example:
•
In connection with acquisition activity, we typically incur costs associated with executing the transactions, integrating the acquired operations (which may include expenditures for consulting and the integration of systems and processes), and restructuring the combined company (which may include charges related to employees, assets and activities that will not continue in the combined company); and
•
In connection with our cost-reduction/productivity initiatives, we typically incur costs and charges associated with site closings and other facility rationalization actions, workforce reductions and the expansion of shared services, including the development of global systems.
All of our businesses and functions may be impacted by these actions, including sales and marketing, manufacturing and R&D, as well as groups such as information technology, shared services and corporate operations.

In connection with our acquisition of Hospira in September 2015, we focused our efforts on achieving an appropriate cost structure for the combined company. We incurred costs of approximately $1 billion (not including costs of $215 million in 2015 associated with the return of acquired IPR&D rights as described in the Current-Period Key Activities section below) associated with the integration of Hospira. The majority of these costs were incurred within the three-year period post-acquisition.

In 2016, we substantially completed previously disclosed cost-reduction initiatives begun in 2014 associated with our 2014 global commercial structure reorganization, manufacturing plant network rationalization and optimization initiatives, and additional cost-reduction/productivity initiatives across the enterprise.
2017-2019 Initiatives and Organizing for Growth
During 2018, as we reviewed our business opportunities and challenges and the way in which we think about our business operations, we determined that at the start of our 2019 fiscal year, we would begin operating under our new commercial structure, which reorganizes our operations into three businesses––Biopharma, a science-based Innovative medicines business; Upjohn, a global off-patent branded and generic established medicines business; and a Consumer Healthcare business. To operate effectively in this structure and position ourselves for future growth, we are focused on creating a simpler, more efficient operating structure within each business as well as the functions that support them. Beginning in the fourth quarter of 2018, we reviewed previously planned initiatives and new initiatives to ensure that there was alignment around our new structure and have combined the 2017 to 2019 initiatives with our current Organizing for Growth initiatives to form one cohesive plan. Initiatives for the combined program include activities related to the optimization of our manufacturing plant network, the centralization of our corporate and platform functions, and the simplification and optimization of our operating business structure and functions that support them. Through December 31, 2018, we incurred approximately $713 million associated with manufacturing optimization, and approximately $752 million associated with other activities.
In 2019, we expect restructuring, implementation and additional depreciation charges of about $800 million and, of that amount, we expect approximately 20% of the total charges will be non-cash.
Current-Period Key Activities
In 2018, we incurred costs of $1.4 billion composed of $1.1 billion associated with the 2017-2019 and Organizing for Growth initiatives, $274 million associated with the integration of Hospira and $45 million associated with all other acquisition-related initiatives.
The following table provides the components of costs associated with acquisitions and cost-reduction/productivity initiatives:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Restructuring charges/(credits):
 
 
 
 
 
 
Employee terminations
 
$
459

 
$
(181
)
 
$
839

Asset impairments(a)
 
290

 
190

 
142

Exit costs
 
33

 
21

 
74

Total restructuring charges(b)
 
782

 
30

 
1,055

Transaction costs(c)
 
1

 
4

 
127

Integration costs(d)
 
260

 
317

 
383

Restructuring charges and certain acquisition-related costs
 
1,044

 
351

 
1,565

Net periodic benefit costs recorded in Other (income)/deductions––net(e)
 
146

 
136

 
159

Additional depreciation––asset restructuring, virtually all of which is recorded in Cost of sales(f)
 
50

 
91

 
207

Implementation costs recorded in our consolidated statements of income as follows(g):
 
 
 
 
 
 
Cost of sales
 
83

 
118

 
230

Selling, informational and administrative expenses
 
72

 
71

 
81

Research and development expenses
 
39

 
38

 
25

Other (income)/deductions––net
 
—

 
—

 
3

Total implementation costs
 
194

 
227

 
340

Total costs associated with acquisitions and cost-reduction/productivity initiatives
 
$
1,434

 
$
805

 
$
2,271

(a) 
The asset impairment charges for 2018 are largely associated with cost reduction initiatives not associated with acquisitions. The asset impairment charges for 2017 are largely associated with our acquisitions of Hospira and Medivation. The asset impairment charges included in restructuring charges for 2017 and 2016 are primarily associated with abandoned assets. See (b) below for additional information.
(b) 
In 2018, restructuring charges were primarily related to employee termination costs and asset write downs. The employee termination costs are associated with our improvements to operational effectiveness as part of the realignment of our organizational structure effective at the beginning of 2019. In 2017, restructuring charges are primarily associated with our acquisitions of Hospira and Medivation, partially offset by credits associated with cost-reduction and productivity initiatives not associated with acquisitions that mostly related to the reversal of previously recorded accruals for employee termination costs resulting from revisions of our severance benefit estimates. In 2016, restructuring charges are largely associated with cost-reduction and productivity initiatives not associated with acquisitions, as well as our acquisitions of Hospira and Medivation. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.
The restructuring activities in 2018 are associated with the following:
•
IH ($176 million charge); EH ($31 million charge); WRD/GPD ($135 million charge); manufacturing operations ($403 million charge); and Corporate ($38 million charge).
The restructuring activities in 2017 are associated with the following:
•
IH ($83 million credit); EH ($6 million credit); WRD/GPD ($19 million charge); manufacturing operations ($89 million charge); and Corporate ($12 million charge),
The restructuring activities in 2016 are associated with the following:
•
IH ($255 million charge); EH ($155 million charge); WRD/GPD ($145 million charge); manufacturing operations ($328 million charge); and Corporate ($172 million charge).
(c) 
Transaction costs represent external costs for banking, legal, accounting and other similar services, which in 2017 were directly related to our acquisitions of Hospira, Anacor and Medivation.Transaction costs in 2016 were mostly related to our acquisitions of Medivation and Anacor, and the terminated transaction with Allergan.
(d) 
Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes. In 2018, integration costs were primarily related to our acquisition of Hospira. In 2017, integration costs primarily related to our acquisitions of Hospira and Medivation, as well as a net gain of $12 million related to the settlement of the Hospira U.S. qualified defined benefit pension plan (see Note 11). In 2016, integration costs primarily related to our acquisition of Hospira and the terminated transaction with Allergan.
(e) 
In 2018, primarily represents the net pension curtailments and settlements included in Other (income)/deductions––net upon the adoption of a new accounting standard in the first quarter of 2018. In 2017, primarily represents the net pension curtailments and settlements, partially offset by net periodic benefit credits, excluding service costs, related to our acquisition of Hospira, both of which were reclassified to Other (income)/deductions––net as a result of the retrospective adoption of a new accounting standard in the first quarter of 2018. These credits included a net settlement gain, partially offset by accelerated amortization of actuarial losses and prior service costs upon the settlement of the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. In 2016, primarily represents the net pension curtailments and settlements as well as the accelerated amortization of unrecognized loss and prior service costs related to our acquisition of Hospira, which were reclassified to Other (income)/deductions––net as a result of the retrospective adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 1B and Note 11.
(f) 
Additional depreciation––asset restructuring represents the impact of changes in the estimated useful lives of assets involved in restructuring actions.
(g) 
Implementation costs represent external, incremental costs directly related to implementing our non-acquisition-related cost-reduction/productivity initiatives.
The following table provides the components of and changes in our restructuring accruals:
(MILLIONS OF DOLLARS)
 
Employee
Termination
Costs

 
Asset
Impairment
Charges

 
Exit Costs

 
Accrual

Balance, January 1, 2017
 
$
1,547

 
$
—

 
$
36

 
$
1,583

Provision/(Credit)
 
(181
)
 
190

 
21

 
30

Utilization and other(a)
 
(326
)
 
(190
)
 
9

 
(508
)
Balance, December 31, 2017(b)
 
1,039

 
—

 
66

 
1,105

Provision
 
459

 
290

 
33

 
782

Utilization and other(a)
 
(295
)
 
(290
)
 
(51
)
 
(636
)
Balance, December 31, 2018(c)
 
$
1,203

 
$
—

 
$
49

 
$
1,252

(a) 
Includes adjustments for foreign currency translation.
(b) 
Included in Other current liabilities ($643 million) and Other noncurrent liabilities ($462 million).
(c) 
Included in Other current liabilities ($823 million) and Other noncurrent liabilities ($428 million).
v3.10.0.1
Other (Income)/Deductions - Net
 12 Months Ended
Dec. 31, 2018
Other Income and Expenses [Abstract]  
Other (Income)/Deductions - Net
Other (Income)/Deductions—Net
The following table provides components of Other (income)/deductions––net:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Interest income(a)
 
$
(333
)
 
$
(391
)
 
$
(470
)
Interest expense(a)
 
1,316

 
1,270

 
1,186

Net interest expense
 
983

 
879

 
716

Royalty-related income(b)
 
(495
)
 
(499
)
 
(905
)
Net (gains)/losses on asset disposals(c)
 
(71
)
 
45

 
(51
)
Net gains recognized during the period on investments in equity securities(d)
 
(586
)
 
(224
)
 
(18
)
Net realized (gains)/losses on sales of investments in debt securities(e)
 
141

 
(45
)
 
(35
)
Income from collaborations, out-licensing arrangements and sales of compound/product rights(f)
 
(488
)
 
(217
)
 
(108
)
Net periodic benefit costs/(credits) other than service costs(g)
 
(288
)
 
101

 
139

Certain legal matters, net(h)
 
157

 
240

 
510

Certain asset impairments(i)
 
3,115

 
395

 
1,447

Loss on sale and impairment on remeasurement of HIS net assets(j)
 
(1
)
 
55

 
1,712

Business and legal entity alignment costs(k)
 
4

 
71

 
261

Net losses on early retirement of debt(l)
 
3

 
999

 
312

Other, net(m)
 
(357
)
 
(383
)
 
(186
)
Other (income)/deductions––net
 
$
2,116

 
$
1,416

 
$
3,794

(a) 
2018 v. 2017––Interest income decreased primarily driven by a lower investment balance. Interest expense increased primarily as a result of higher short-term interest rates, offset, in part, by refinancing activity that occurred in the fourth quarter of 2017. 2017 v. 2016––Interest income decreased primarily driven by a lower investment balance. Interest expense increased, primarily as a result of higher short-term interest rates, offset, in part, by the retirement of high-coupon debt and the issuance of new low-coupon debt. Capitalized interest expense totaled $73 million in 2018, $72 million in 2017 and $61 million in 2016.
(b) 
Royalty-related income decreased in 2017, primarily due to lower royalty income for Enbrel of $470 million in 2017, compared to 2016, resulting from the expiration on October 31, 2016 of the 36-month royalty period under the collaboration agreement for Enbrel in the U.S. and Canada (the collaboration period under the agreement expired on October 31, 2013), partially offset by increases in Xtandi royalty-related income of $176 million in 2017, compared to 2016.
(c) 
In 2018, primarily includes a realized gain on sale of property of $60 million. In 2017, primarily includes an $81 million realized loss related to the sale of our then 49%-owned equity-method investment in Hisun Pfizer and a realized net loss of $30 million related to the sale of our 40% ownership investment in Teuto, including the extinguishment of a put option for the then remaining 60% ownership interest, partially offset by a realized gain on sale of property of $52 million. In 2016, primarily includes realized gains on sales of property and other assets.
(d) 
The net gains on investments in equity securities in 2018, include unrealized net gains on equity securities of $477 million, reflecting the adoption of a new accounting standard in the first quarter of 2018. Net gains in 2018 were primarily driven by unrealized gains of $466 million related to our investment in Allogene. Prior to the adoption of a new accounting standard in the first quarter of 2018, net unrealized gains and losses on virtually all equity securities with readily determinable fair values were reported in Accumulated other comprehensive income. For additional information, see Note 1B, Note 2B and Note 7B.
(e) 
In 2018, primarily includes gross realized losses on sales of available-for-sale debt securities of $402 million and a net loss of $18 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities, partially offset by gross realized gains on sales of available-for-sale debt securities of $280 million. Proceeds from the sale of available-for-sale debt securities were $5.7 billion in 2018.
In 2017, primarily includes gross realized gains on sales of available-for-sale debt securities of $451 million, partially offset by gross realized losses on sales of available-for-sale debt securities of $281 million and a net loss of $120 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities. Proceeds from the sale of available-for-sale debt securities were $5.1 billion in 2017.
In 2016, primarily includes gross realized gains on sales of available-for-sale debt securities of $666 million, partially offset by gross realized losses on sales of available-for-sale debt securities of $548 million and a net loss of $64 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities. Proceeds from the sale of available-for-sale debt securities were $10.2 billion in 2016.
(f) 
Includes income from upfront and milestone payments from our collaboration partners and income from out-licensing arrangements and sales of compound/product rights. In 2018, primarily includes, among other things, (i) approximately $118 million in milestone income from multiple licensees, (ii) $110 million in milestone payments received from Shire, of which $75 million was received in the first quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of ulcerative colitis and $35 million was received from Shire in the third quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of Crohn’s disease, (iii) an upfront payment to us and a recognized milestone totaling $85 million for the sale of an AMPA receptor potentiator for CIAS to Biogen, (iv) $62 million in gains related to sales of compound/product rights and (v) a $40 million milestone payment from Merck in conjunction with the approval of ertugliflozin in the EU. For additional information, see Note 2B, Note 2C, Note 2D and Note 2E. In 2017, primarily includes, among other things, $101 million in milestone payments received from multiple licensees and an $85 million gain related to sales of compound/product rights. In 2016, primarily includes, among other things, a $50 million gain related to sales of compound/product rights and $33 million in milestone payments received from multiple licensees.
(g) 
Represents the net periodic benefit costs/(credits), excluding service costs, as a result of the adoption of a new accounting standard in the first quarter of 2018. Effective January 1, 2018, the U.S. Pfizer Consolidated Pension Plan was frozen to future benefit accruals and for 2018, resulted in the recognition of lower net periodic benefit costs due to the extension of the amortization period for the actuarial losses. There was also a greater than expected gain on plan assets due to a higher plan asset base compared to 2017. For additional information, see Note 1B and Note 11.
(h) 
In 2018, primarily includes legal reserves for certain pending legal matters, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In 2017, primarily includes a $94 million charge to resolve a class action lawsuit filed by direct purchasers relating to Celebrex, which was approved by the court in April 2018, and a $79 million charge to reflect damages awarded by a jury in a patent matter. In 2016, primarily includes amounts to resolve a Multi-District Litigation relating to Celebrex and Bextra pending against the Company in New York federal court for $486 million, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In addition, 2016 includes a settlement related to a patent matter.
(i) 
In 2018, primarily includes intangible asset impairment charges of $3.1 billion, mainly composed of (i) $2.6 billion related to EH developed technology rights, $242 million related to EH licensing agreements and $80 million related to EH IPR&D, all of which relate to our acquisition of Hospira, for generic sterile injectable products associated with various indications; (ii) $117 million related to a multi-antigen vaccine IPR&D program for adults undergoing elective spinal fusion surgery; (iii) $31 million related to an IH developed technology right, acquired in connection with our acquisition of Anacor, for the treatment for toenail fungus market marketed in the U.S. market only; and (iv) $17 million of other IPR&D assets acquired in connection with our acquisition of Innopharma. In 2018, the intangible asset impairment charges associated with the generic sterile injectable products reflect, among other things, updated commercial forecasts, reflecting an increased competitive environment as well as higher manufacturing costs, largely stemming from ongoing manufacturing and supply issues. The intangible asset impairment charge for the multi-antigen vaccine IPR&D program was the result of the Phase 2b trial reaching futility at a pre-planned interim analysis. The intangible asset impairment charge related to the IH developed technology right reflects, among other things, updated commercial forecasts. In addition, 2018 includes other asset impairments of $13 million.
In 2017, primarily includes intangible asset impairment charges of $337 million, reflecting (i) $127 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a generic sterile injectable product for the treatment of edema associated with certain conditions; (ii) $124 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a sterile injectable pain reliever; (iii) $39 million related to developed technology rights, acquired in connection with our acquisition of NextWave, for the treatment of attention deficit hyperactivity disorder; (iv) $26 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a generic injectable antibiotic product for the treatment of bacterial infections; and (v) $20 million related to other developed technology rights. The intangible asset impairment charges for 2017 are associated with EH and reflect, among other things, updated commercial forecasts and an increased competitive environment. In addition, 2017 includes a loss of $43 million for an impairment of our AM-Pharma B.V. long-term investment (see Note 2G).
In 2016, primarily includes intangible asset impairment charges of $869 million, reflecting (i) $366 million related to developed technology rights for a generic injectable antibiotic product for the treatment of bacterial infections; and (ii) $265 million related to an IPR&D compound for the treatment of anemia, both acquired in connection with our acquisition of Hospira; (iii) $128 million of sterile injectable IPR&D compounds acquired in connection with our acquisition of InnoPharma; and (iv) $110 million of other IPR&D assets, $81 million of which were acquired in connection with our acquisition of Hospira and $29 million of which were acquired in connection with our acquisition of King in 2011. The intangible asset impairment charges for 2016 are associated with the following: EH ($840 million) and IH ($29 million). In addition, 2016 includes an impairment loss of $452 million related to Pfizer’s then 49%-owned equity-method investment with Hisun in China, Hisun Pfizer, and an impairment loss of $50 million related to Pfizer's 40%-owned equity-method investment in Teuto. For additional information concerning Hisun Pfizer and Teuto, see Note 2F.
The intangible asset impairment charge for 2016 for the IPR&D compound for the treatment of anemia acquired in connection with our acquisition of Hospira reflects, among other things, the impact of regulatory delays, including delays resulting from a then recent court ruling, requiring a 180-day waiting period after approval before a biosimilar product can be launched. The intangible asset impairment charges for 2016 for the sterile injectable IPR&D compounds acquired in connection with our acquisition of InnoPharma reflect, among other things, the impact of portfolio prioritization decisions and decreased commercial profiles of certain compounds. The intangible asset impairment charges for 2016 for developed technology rights and other IPR&D assets acquired in connection with our acquisition of Hospira reflect, among other things, the impact of regulatory delays, the impact of new scientific findings, updated commercial forecasts, changes in pricing, and an increased competitive environment. The intangible asset impairment charges for 2016 for other IPR&D assets acquired in connection with our acquisition of King reflect changes in the competitive environment.
(j) 
In 2018 and 2017, represents adjustments to amounts previously recorded in 2016 to write down the HIS net assets to fair value less costs to sell related to the sale of HIS net assets to ICU Medical on February 3, 2017. In 2016, represents a charge related to the write-down of the HIS net assets to fair value less estimated costs to sell. See Note 2B for additional information.
(k) 
Represents expenses for changes to our infrastructure to align our commercial operations that existed through December 31, 2018, including costs to internally separate our businesses into distinct legal entities, as well as to streamline our intercompany supply operations to better support each business.
(l) 
In 2017 and 2016, represents net losses due to the early retirement of debt, inclusive of the related termination of cross currency swaps in 2017 and inclusive of the related termination of interest rate swaps in 2016.
(m) 
In 2018, includes (i) a non-cash $343 million pre-tax gain associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system (see Note 2B), (ii) dividend income of $253 million from our investment in ViiV, (iii) a non-cash $50 million pre-tax gain on the contribution of Pfizer’s allogeneic CAR T therapy development program assets obtained from Cellectis and Servier in connection with our contribution agreement entered into with Allogene in which Pfizer obtained a 25% ownership stake in Allogene (see Note 2B), and (iv) a non-cash $17 million pre-tax gain on the cash settlement of a liability that we incurred in April 2018 upon the EU approval of Mylotarg (see Note 7E), partially offset by charges of $207 million, reflecting the change in the fair value of contingent consideration and $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily include consulting, legal, tax, and advisory services. In 2017, includes, among other things, dividend income of $266 million from our investment in ViiV, and income of $62 million from resolution of a contract disagreement. In 2016, includes among other things, $150 million paid to Allergan for reimbursement of Allergan’s expenses associated with the terminated transaction (see Note 1A); and income of $116 million from resolution of a contract disagreement.
The asset impairment charges included in Other (income)/deductions––net are based on estimates of fair value.
The following table provides additional information about the intangible assets that were impaired during 2018 in Other (income)/deductions––net:
 
 
 
 
Year Ended December 31,

 
 
Fair Value(a)
 
2018

(MILLIONS OF DOLLARS)
 
Amount

 
Level 1

 
Level 2

 
Level 3

 
Impairment

Intangible assets––Developed technology rights(b)
 
$
665

 
$
—

 
$
—

 
$
665

 
$
2,647

Intangible assets––Licensing agreements and other(b)
 
150

 
—

 
—

 
150

 
242

Intangible assets––IPR&D(b)
 
95


—


—


95


214

Total
 
$
910

 
$
—

 
$
—

 
$
910

 
$
3,103

(a) 
The fair value amount is presented as of the date of impairment, as these assets are not measured at fair value on a recurring basis. See also Note 1E.
(b) 
Reflects intangible assets written down to fair value in 2018. Fair value was determined using the income approach, specifically the multi-period excess earnings method, also known as the discounted cash flow method. We started with a forecast of all the expected net cash flows associated with the asset and then applied an asset-specific discount rate to arrive at a net present value amount. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the product; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.
v3.10.0.1
Tax Matters
 12 Months Ended
Dec. 31, 2018
Income Tax Disclosure [Abstract]  
Tax Matters
Tax Matters

A. Taxes on Income from Continuing Operations
The following table provides the components of Income from continuing operations before provision/(benefit) for taxes on income:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

United States
 
$
(4,403
)
 
$
(6,879
)
 
$
(8,534
)
International
 
16,288

 
19,184

 
16,886

Income from continuing operations before provision/(benefit) for taxes on income(a), (b)
 
$
11,885

 
$
12,305

 
$
8,351

(a) 
2018 v. 2017––The decrease in the domestic loss was primarily due to lower interest expense paid to certain foreign subsidiaries, lower net losses on the retirement of debt, higher net gains on investments in equity securities and increased revenue related to Eliquis, partially offset by higher certain asset impairments and lower revenue for Viagra and the SIP portfolio. The decrease in international income was primarily related to lower interest income received primarily from intercompany borrowings from Pfizer Inc. and higher charges related to certain cost reduction initiatives, partially offset by increased revenue related to Ibrance and Eliquis.
(b) 
2017 v. 2016––The decrease in the domestic loss was primarily due to lower restructuring charges and certain acquisition-related costs, the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower certain asset impairments and lower certain legal matters, partially offset by higher net losses on early retirement of debt, and higher amortization of intangible assets. The increase in international income was primarily due to the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower restructuring charges and certain acquisition-related costs, and lower certain asset impairments.
The following table provides the components of Provision/(benefit) for taxes on income based on the location of the taxing authorities:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

United States
 
 
 
 
 
 
Current income taxes:
 
 
 
 
 
 
Federal
 
$
668

 
$
1,267

 
$
342

State and local
 
9

 
45

 
(52
)
Deferred income taxes:
 
 
 
 
 
 
Federal
 
(1,663
)
 
(2,064
)
 
(419
)
State and local
 
16

 
(304
)
 
(106
)
Total U.S. tax provision
 
(970
)
 
(1,055
)
 
(235
)
TCJA(a)
 
 
 
 
 
 
Current income taxes
 
(3,035
)
 
13,135

 
—

Deferred Income taxes
 
2,439

 
(23,795
)
 
—

Total TCJA tax provision
 
(596
)
 
(10,660
)
 
—

International
 
 
 
 
 
 
Current income taxes
 
2,831

 
2,709

 
1,532

Deferred income taxes
 
(558
)
 
(42
)
 
(175
)
Total international tax provision
 
2,273

 
2,667

 
1,358

Provision/(benefit) for taxes on income
 
$
706

 
$
(9,049
)
 
$
1,123


(a) 
The 2018 current tax benefit and deferred tax expense primarily relate to the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See discussion below and Note 5C.
In the fourth quarter of 2017, we recorded an estimate of certain tax effects of the TCJA, including (i) the impact on deferred tax assets and liabilities from the reduction in the U.S. Federal corporate tax rate from 35% to 21%, (ii) the impact on valuation allowances and other state income tax considerations, (iii) the $15.2 billion repatriation tax liability on accumulated post-1986 foreign earnings for which we plan to elect, with the filing of our 2018 U.S. Federal Consolidated Income Tax Return, payment over eight years through 2026 that is reported in Other taxes payable in our consolidated balance sheet as of December 31, 2017 and (iv) deferred taxes on basis differences expected to give rise to future taxes on global intangible low-taxed income. In addition, we had provided deferred tax liabilities in the past on foreign earnings that were not indefinitely reinvested. As a result of the TCJA, in the fourth quarter of 2017, we reversed an estimate of the deferred taxes that are no longer expected to be needed due to the change to the territorial tax system.
In 2018, we finalized our provisional accounting for the tax effects of the TCJA, based on our best estimates of available information and data, and have reported and disclosed the impacts within the applicable measurement period, in accordance with guidance issued by the SEC, and recorded a favorable adjustment of approximately $100 million to Provision/(benefit) for taxes on income. The amounts recorded may change in the future due to uncertain tax positions. With respect to the aforementioned repatriation tax liability, our revised estimate is approximately $15 billion. The first installment, due in April 2019, is reported in Income taxes payable, and the remaining liability is reported in Other taxes payable in our consolidated balance sheet as of December 31, 2018. We believe that there may be additional interpretations, clarifications and guidance from the U.S. Department of Treasury. Any change to our calculations resulting from such additional interpretations, clarifications and guidance would be reflected in the period of issuance. In addition, our obligations may vary as a result of changes in our uncertain tax positions and/or availability of attributes such as foreign tax and other credit carryforwards.
The TCJA subjects a U.S. shareholder to current tax on global intangible low-taxed income earned by certain foreign subsidiaries. The FASB Staff Q&A, Topic 740, No. 5, Accounting for Global Intangible Low-Taxed Income, states that we are permitted to make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as global intangible low-taxed income in future years or provide for the tax expense related to such income in the year the tax is incurred. We have elected to recognize deferred taxes for temporary differences expected to reverse as global intangible low-taxed income in future years. In 2017, we provided a provisional deferred tax liability of approximately $1.0 billion based on the evaluation of certain temporary differences inside each of our foreign subsidiaries that are expected to reverse as global intangible low-taxed income. In 2018, this estimate was finalized and we have provided for an additional deferred tax liability of approximately $200 million, resulting in a deferred tax liability of approximately $1.2 billion.

In 2018, the Provision/(benefit) for taxes on income was impacted by the following:
•
estimated U.S. net tax benefits of approximately $600 million associated with the enactment of the TCJA (see discussion above), primarily reflecting:
◦
approximately $500 million of tax benefits associated primarily with certain current year tax initiatives;
◦
approximately $100 million of tax benefits associated with adjustments to our provisional accounting for the tax effects of the TCJA, reported and disclosed within the applicable measurement period, in accordance with guidance issued by the SEC, primarily consisting of:
◦
$160 million of tax benefits related to the repatriation tax on deemed repatriated accumulated earnings of foreign subsidiaries; and
◦
$140 million of tax benefits associated with the remeasurement of other U.S. deferred tax liabilities,
partially offset by:
◦
$200 million of tax expense related to future taxes on global intangible low-taxed income;
•
tax benefits of approximately $700 million representing tax and interest resulting from the resolution of certain tax positions pertaining to prior years primarily with various foreign tax authorities, and the expiration of certain statutes of limitations; and
•
tax benefits of approximately $740 million related to certain asset impairments.

In 2017, the Provision/(benefit) for taxes on income was impacted by the following:
•
estimated U.S. net tax benefits of $10.7 billion associated with the enactment of the TCJA (see discussion above), primarily reflecting:
◦
$22.8 billion tax benefit associated with the remeasurement of U.S. deferred tax liabilities on unremitted earnings of foreign subsidiaries (see Note 5C);
◦
$1.6 billion tax benefit associated with the remeasurement of other U.S. deferred tax liabilities, primarily associated with intangibles (see Note 5C);
◦
$12.9 billion tax expense related to the repatriation tax on deemed repatriated accumulated pre-2017 post-1986 earnings of foreign subsidiaries;
◦
$1.0 billion tax expense related to future taxes on global intangible low-taxed income (see Note 5C); and
◦
approximately $100 million tax benefit primarily associated with certain tax initiatives;
•
U.S. tax expense of approximately $1.3 billion related to the repatriation tax on deemed repatriated current year earnings of foreign subsidiaries;
•
tax benefit of approximately $370 million related to net losses on early retirement of debt;
•
tax benefits of approximately $150 million representing tax and interest resulting from the resolution of certain tax positions pertaining to prior years primarily with various foreign tax authorities, and the expiration of certain statutes of limitations; and
•
the non-deductibility of a $307 million fee payable to the federal government as a result of the U.S. Healthcare Legislation.
In 2016, the Provision/(benefit) for taxes on income was impacted by the following:
•
U.S. tax expense of approximately $1.1 billion as a result of providing U.S. deferred income taxes on certain funds earned outside the U.S. that will not be indefinitely reinvested overseas, virtually all of which were earned in 2016;
•
tax benefits of approximately $460 million, representing tax and interest, resulting from the resolution of certain tax positions pertaining to prior years, primarily with various foreign tax authorities, and from the expiration of certain statutes of limitations;
•
benefits related to the final resolution of an agreement in principle reached in February 2016 and finalized in April 2016 to resolve certain claims related to Protonix, which resulted in the receipt of information that raised our initial assessment in 2015 of the likelihood of prevailing on the technical merits of our tax position;
•
net tax benefits of $89 million, related to the adoption of a new accounting standard in the fourth quarter of 2016, as of January 1, 2016, requiring excess tax benefits or deficiencies of share-based compensation to be recognized as a component of the Provision/(benefit) for taxes on income (see Notes to Consolidated Financial Statements––Note 1B. Basis of Presentation and Significant Accounting Policies: Adoption of New Accounting Standards in Pfizer’s 2016 Financial Report);
•
the non-deductibility of a $312 million fee payable to the federal government as a result of the U.S. Healthcare Legislation; and
•
the permanent extension of the U.S. R&D tax credit, which was signed into law in December 2015.
In all years, federal, state and international net tax liabilities assumed or established as part of a business acquisition are not included in Provision/(benefit) for taxes on income (see Note 2A).

B. Tax Rate Reconciliation
The reconciliation of the U.S. statutory income tax rate to our effective tax rate for Income from continuing operations follows:
 
 
Year Ended December 31,
 
 
2018

 
2017

 
2016

U.S. statutory income tax rate
 
21.0
 %
 
35.0
 %
 
35.0
 %
TCJA impact(a)
 
(5.0
)
 
(86.6
)
 
—

Taxation of non-U.S. operations (b), (c), (d)
 
(6.1
)
 
(17.0
)
 
(13.8
)
Tax settlements and resolution of certain tax positions(e)
 
(5.8
)
 
(1.2
)
 
(5.5
)
U.S. Healthcare Legislation(e), (f)
 
(0.4
)
 
0.9

 
1.3

U.S. R&D tax credit and manufacturing deduction(e)
 
(0.7
)
 
(0.7
)
 
(1.0
)
Certain legal settlements and charges(e)
 
(0.1
)
 
0.1

 
(2.9
)
All other, net(g)
 
3.1

 
(3.9
)
 
0.3

Effective tax rate for income from continuing operations
 
5.9
 %
 
(73.5
)%
 
13.4
 %
(a) 
For a discussion about the enactment of the TCJA, see Note 5A.
(b) 
For taxation of non-U.S. operations, this rate impact reflects the income tax rates and relative earnings in the locations where we do business outside the U.S., together with the cost of repatriation decisions, which, for 2017, includes the repatriation tax on deemed repatriated 2017 earnings of foreign subsidiaries discussed in Note 5A, changes in uncertain tax positions not included in the reconciling item called “Tax settlements and resolution of certain tax positions,” as well as changes in valuation allowances. Specifically: (i) the jurisdictional location of earnings is a significant component of our effective tax rate each year, and the rate impact of this component is influenced by the specific location of non-U.S. earnings and the level of such earnings as compared to our total earnings; (ii) the cost of repatriation decisions, and other U.S. tax implications of our foreign operations, is a significant component of our effective tax rate each year and generally offsets some of the reduction to our effective tax rate each year resulting from the jurisdictional location of earnings; and (iii) the impact of changes in uncertain tax positions not included in the reconciling item called “Tax settlements and resolution of certain tax positions” is a component of our effective tax rate each year that can result in either an increase or decrease to our effective tax rate. The jurisdictional mix of earnings, which includes the impact of the location of earnings as well as repatriation costs, can vary as a result of the repatriation decisions, as a result of operating fluctuations in the normal course of business and as a result of the extent and location of other income and expense items, such as restructuring charges, asset impairments and gains and losses on strategic business decisions. See also Note 5A for the components of pre-tax income and Provision/(benefit) for taxes on income, which is based on the location of the taxing authorities, and for information about settlements and other items impacting Provision/(benefit) for taxes on income.
(c) 
In all periods presented, the reduction in our effective tax rate resulting from the jurisdictional location of earnings is largely due to lower tax rates in certain jurisdictions, as well as manufacturing and other incentives associated with our subsidiaries in Puerto Rico and Singapore. 2016 also includes incentives in Costa Rica and the Dominican Republic related to the Hospira infusion systems business, which was sold to ICU Medical in February 2017. We benefit from a Puerto Rican incentive grant that expires in 2029. Under the grant, we are partially exempt from income, property and municipal taxes. In Singapore, we benefit from incentive tax rates effective through 2031 on income from manufacturing and other operations.
(d) 
The favorable rate impacts in 2018 and 2017 also reflect lower repatriation costs associated with the estimated income of our foreign subsidiaries. The favorable rate impact in 2016 also includes the non-recurrence of the non-deductibility of a foreign currency loss related to Venezuela.
(e) 
For a discussion about tax settlements and resolution of certain tax positions, the impact of U.S. Healthcare Legislation, the U.S. R&D tax credit and manufacturing deduction and the impact of certain legal settlements and charges, see Note 5A.
(f) 
The favorable rate impact in 2018 is a result of the updated 2017 invoice received from the federal government, which reflected a lower expense than what was previously estimated for invoiced periods, as well as certain tax initiatives.
(g) 
All other, net in 2018 is primarily due to routine business operations and the non-recurrence of tax benefits associated with certain tax initiatives. 2017 primarily relates to tax benefits associated with certain tax initiatives in the normal course of business.

C. Deferred Taxes

Deferred taxes arise as a result of basis differentials between financial statement accounting and tax amounts.
The components of our deferred tax assets and liabilities, shown before jurisdictional netting, follow:
 
 
2018 Deferred Tax*
 
2017 Deferred Tax*
(MILLIONS OF DOLLARS)
 
Assets
 
(Liabilities)
 
Assets
 
(Liabilities)
Prepaid/deferred items
 
$
1,655

 
$
(325
)
 
$
1,837

 
$
(132
)
Inventories
 
280

 
(10
)
 
405

 
(3
)
Intangible assets(a)
 
532

 
(7,620
)
 
685

 
(10,808
)
Property, plant and equipment
 
160

 
(1,011
)
 
124

 
(755
)
Employee benefits
 
2,292

 
(134
)
 
2,346

 
(109
)
Restructurings and other charges
 
266

 
—

 
240

 
(8
)
Legal and product liability reserves
 
415

 
—

 
480

 
—

Net operating loss/tax credit carryforwards(b), (c)
 
2,512

 
—

 
4,502

 
—

Unremitted earnings
 
—

 
(83
)
 
—

 
(85
)
State and local tax adjustments
 
264

 
—

 
178

 
—

All other
 
200

 
(274
)
 
492

 
(424
)
 
 
8,576

 
(9,456
)
 
11,289

 
(12,325
)
Valuation allowances
 
(2,068
)
 
—

 
(2,203
)
 
—

Total deferred taxes
 
$
6,508

 
$
(9,456
)
 
$
9,086

 
$
(12,325
)
Net deferred tax liability(d)
 
 
 
$
(2,948
)
 
 
 
$
(3,238
)
*
For 2018 and 2017, the deferred tax assets and liabilities associated with global intangible low-taxed income are included in the relevant categories above. See Note 5A. 2018 excludes deferred tax assets and liabilities associated with fully dedicated consumer healthcare subsidiaries. For additional information, see Note 2C.
(a) 
The decrease in 2018 is primarily the result of amortization of intangible assets and certain impairment charges.
(b) 
The decrease in 2018 is primarily a result of the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See Note 5A.
(c) 
The amounts in 2018 and 2017 are reduced for unrecognized tax benefits of $3.3 billion and $3.4 billion, respectively, where we have net operating loss carryforwards, similar tax losses, and/or tax credit carryforwards that are available, under the tax law of the applicable jurisdiction, to settle any additional income taxes that would result from the disallowance of a tax position.
(d) 
In 2018, Noncurrent deferred tax assets and other noncurrent tax assets ($0.8 billion), and Noncurrent deferred tax liabilities ($3.7 billion). In 2017, Noncurrent deferred tax assets and other noncurrent tax assets ($0.7 billion), and Noncurrent deferred tax liabilities ($3.9 billion).

We have carryforwards, primarily related to net operating and capital losses and charitable contributions, which are available to reduce future U.S. federal and/or state, as well as international, income taxes payable with either an indefinite life or expiring at various times from 2018 to 2038. Certain of our U.S. net operating losses are subject to limitations under IRC Section 382.

Valuation allowances are provided when we believe that our deferred tax assets are not recoverable based on an assessment of estimated future taxable income that incorporates ongoing, prudent and feasible tax planning strategies, that would be implemented, if necessary, to realize the deferred tax assets.

As of December 31, 2018, we have not made a U.S. tax provision on approximately $31.0 billion of unremitted earnings of our international subsidiaries. As these earnings are intended to be indefinitely reinvested overseas, the determination of a hypothetical unrecognized deferred tax liability as of December 31, 2018 is not practicable.

D. Tax Contingencies

We are subject to income tax in many jurisdictions, and a certain degree of estimation is required in recording the assets and liabilities related to income taxes. All of our tax positions are subject to audit by the local taxing authorities in each tax jurisdiction. These tax audits can involve complex issues, interpretations and judgments and the resolution of matters may span multiple years, particularly if subject to negotiation or litigation. Our assessments are based on estimates and assumptions that have been deemed reasonable by management, but our estimates of unrecognized tax benefits and potential tax benefits may not be representative of actual outcomes, and variation from such estimates could materially affect our financial statements in the period of settlement or when the statutes of limitations expire, as we treat these events as discrete items in the period of resolution.

For a description of our accounting policies associated with accounting for income tax contingencies, see Note 1P. For a description of the risks associated with estimates and assumptions, see Note 1C.
Uncertain Tax Positions

As tax law is complex and often subject to varied interpretations, it is uncertain whether some of our tax positions will be sustained upon audit. As of December 31, 2018 we had approximately $5.1 billion in net unrecognized tax benefits, excluding associated interest and as of December 31, 2017 we had approximately $5.4 billion in net unrecognized tax benefits, excluding associated interest.
•
Tax assets associated with uncertain tax positions primarily represent our estimate of the potential tax benefits in one tax jurisdiction that could result from the payment of income taxes in another tax jurisdiction. These potential benefits generally result from cooperative efforts among taxing authorities, as required by tax treaties to minimize double taxation, commonly referred to as the competent authority process. The recoverability of these assets, which we believe to be more likely than not, is dependent upon the actual payment of taxes in one tax jurisdiction and, in some cases, the successful petition for recovery in another tax jurisdiction. As of December 31, 2018 we had approximately $1.1 billion in assets associated with uncertain tax positions. These amounts were included in Noncurrent deferred tax assets and other noncurrent tax assets ($1.0 billion) and Noncurrent deferred tax liabilities ($128 million). As of December 31, 2017, we had approximately $1.2 billion in assets associated with uncertain tax positions. These amounts were included in Noncurrent deferred tax assets and other noncurrent tax assets ($1.0 billion) and Noncurrent deferred tax liabilities ($118 million).
•
Tax liabilities associated with uncertain tax positions represent unrecognized tax benefits, which arise when the estimated benefit recorded in our financial statements differs from the amounts taken or expected to be taken in a tax return because of the uncertainties described above. These unrecognized tax benefits relate primarily to issues common among multinational corporations. Substantially all of these unrecognized tax benefits, if recognized, would impact our effective income tax rate.
The reconciliation of the beginning and ending amounts of gross unrecognized tax benefits follows:
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Balance, beginning
 
$
(6,558
)
 
$
(5,826
)
 
$
(5,919
)
Acquisitions(a)
 
—

 
10

 
(83
)
Increases based on tax positions taken during a prior period(b)
 
(192
)
 
(49
)
 
(11
)
Decreases based on tax positions taken during a prior period(b), (c)
 
561

 
28

 
409

Decreases based on settlements for a prior period(d)
 
123

 
35

 
126

Increases based on tax positions taken during the current period(b)
 
(370
)
 
(753
)
 
(489
)
Impact of foreign exchange
 
56

 
(121
)
 
(5
)
Other, net(b), (e)
 
121

 
118

 
146

Balance, ending(f)
 
$
(6,259
)
 
$
(6,558
)
 
$
(5,826
)
(a) 
For 2017 and 2016, primarily related to the acquisitions of Medivation and Anacor. See also Note 2A.
(b) 
Primarily included in Provision/(benefit) for taxes on income.
(c) 
Primarily related to effectively settling certain tax positions primarily with foreign tax authorities. See also Note 5A.
(d) 
Primarily related to cash payments and reductions of tax attributes.
(e) 
Primarily related to decreases as a result of a lapse of applicable statutes of limitations.
(f) 
In 2018, included in Income taxes payable ($11 million), Current tax assets ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($47 million), Noncurrent deferred tax liabilities ($3.2 billion) and Other taxes payable ($3.0 billion). In 2017, included in Income taxes payable ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($123 million), Noncurrent deferred tax liabilities ($3.3 billion) and Other taxes payable ($3.2 billion).
•
Interest related to our unrecognized tax benefits is recorded in accordance with the laws of each jurisdiction and is recorded primarily in Provision/(benefit) for taxes on income in our consolidated statements of income. In 2018, we recorded a net increase in interest of $103 million. In 2017, we recorded a net increase in interest of $208 million; and in 2016, we recorded a net increase in interest of $72 million. Gross accrued interest totaled $1.1 billion as of December 31, 2018 (reflecting a decrease of approximately $16 million as a result of cash payments) and gross accrued interest totaled $975 million as of December 31, 2017 (reflecting a decrease of approximately $4 million as a result of cash payments). In 2018, this amount was included in Income taxes payable ($6 million) and Other taxes payable ($1.1 billion). In 2017, this amount was included in Other taxes payable ($975 million). Accrued penalties are not significant. See also Note 5A.

Status of Tax Audits and Potential Impact on Accruals for Uncertain Tax Positions

The U.S. is one of our major tax jurisdictions, and we are regularly audited by the IRS:
•
With respect to Pfizer, the IRS has issued a Revenue Agent’s Report (RAR) for tax years 2009-2010. We are not in agreement with the RAR and are currently appealing certain disputed issues. Tax years 2011-2015 are currently under audit. Tax years 2016-2018 are open, but not under audit. All other tax years are closed.
•
With respect to Hospira, the federal income tax audit of tax year 2014 through short-year 2015 was effectively settled in the second quarter of 2018. All other tax years are closed.
•
With respect to Anacor and Medivation, the open tax years are not considered material to Pfizer.

In addition to the open audit years in the U.S., we have open audit years in other major tax jurisdictions, such as Canada (2013-2018), Japan (2017-2018), Europe (2011-2018, primarily reflecting Ireland, the United Kingdom, France, Italy, Spain and Germany), Latin America (1998-2018, primarily reflecting Brazil) and Puerto Rico (2011-2018).

Any settlements or statutes of limitations expirations could result in a significant decrease in our uncertain tax positions. We estimate that it is reasonably possible that within the next 12 months, our gross unrecognized tax benefits, exclusive of interest, could decrease by as much as $75 million, as a result of settlements with taxing authorities or the expiration of the statutes of limitations. Our assessments are based on estimates and assumptions that have been deemed reasonable by management, but our estimates of unrecognized tax benefits and potential tax benefits may not be representative of actual outcomes, and variation from such estimates could materially affect our financial statements in the period of settlement or when the statutes of limitations expire, as we treat these events as discrete items in the period of resolution. Finalizing audits with the relevant taxing authorities can include formal administrative and legal proceedings, and, as a result, it is difficult to estimate the timing and range of possible changes related to our uncertain tax positions, and such changes could be significant.

E. Tax Provision/(Benefit) on Other Comprehensive Income/(Loss)
The following table provides the components of the Tax provision/(benefit) on other comprehensive income/(loss):
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Foreign currency translation adjustments, net(a)
 
$
94

 
$
(215
)
 
$
(15
)
Unrealized holding gains/(losses) on derivative financial instruments, net
 
21

 
72

 
(75
)
Reclassification adjustments for (gains)/losses included in net income
 
27

 
(224
)
 
158

Reclassification adjustments of certain tax effects from AOCI to Retained earnings(b)
 
1

 
—

 
—

 
 
50

 
(152
)
 
83

Unrealized holding gains/(losses) on available-for-sale securities, net
 
(23
)
 
102

 
49

Reclassification adjustments for (gains)/losses included in net income
 
16

 
(60
)
 
(15
)
Reclassification adjustments for tax on unrealized gains from AOCI to Retained earnings(c)
 
(45
)
 
—

 
—

 
 
(53
)
 
42

 
34

Benefit plans: actuarial losses, net
 
(141
)
 
(59
)
 
(535
)
Reclassification adjustments related to amortization
 
55

 
192

 
186

Reclassification adjustments related to settlements, net
 
33

 
42

 
45

Reclassification adjustments of certain tax effects from AOCI to Retained earnings(b)
 
637

 
—

 
—

Other
 
29

 
(39
)
 
36

 
 
612

 
137

 
(269
)
Benefit plans: prior service (costs)/credits and other, net
 
2

 
—

 
67

Reclassification adjustments related to amortization
 
(39
)
 
(67
)
 
(64
)
Reclassification adjustments related to curtailments, net
 
(4
)
 
(7
)
 
(10
)
Reclassification adjustments of certain tax effects from AOCI to Retained earnings(b)
 
(144
)
 
—

 
—

Other
 
—

 
—

 
(1
)
 
 
(185
)
 
(74
)
 
(7
)
Tax provision/(benefit) on other comprehensive income/(loss)
 
$
518

 
$
(262
)
 
$
(174
)
(a) 
Taxes are not provided for foreign currency translation adjustments relating to investments in international subsidiaries that will be held indefinitely.
(b) 
For additional information on the adoption of a new accounting standard related to reclassification of certain tax effects from AOCI, see Note 1B.
(c) 
For additional information on the adoption of a new accounting standard related to financial assets and liabilities, see Note 1B.
v3.10.0.1
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests
 12 Months Ended
Dec. 31, 2018
Equity [Abstract]  
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests
The following table provides the changes, net of tax, in Accumulated other comprehensive loss:
 
 
Net Unrealized Gain/(Losses)
 
Benefit Plans
 
 
(MILLIONS OF DOLLARS)
 
Foreign Currency Translation Adjustments

 
Derivative Financial Instruments

 
Available-For-Sale Securities

 
Actuarial Gains/(Losses)

 
Prior Service (Costs)/ Credits and Other

 
Accumulated Other Comprehensive Income/(Loss)

Balance, January 1, 2016
 
$
(5,863
)
 
$
421

 
$
(227
)
 
$
(4,733
)
 
$
880

 
$
(9,522
)
Other comprehensive income/(loss)(a)
 
(797
)
 
(73
)
 
96

 
(740
)
 
(1
)
 
(1,514
)
Balance, December 31, 2016
 
(6,659
)
 
348

 
(131
)
 
(5,473
)
 
879

 
(11,036
)
Other comprehensive income/(loss)(a)
 
1,479

 
(378
)
 
532

 
211

 
(129
)
 
1,715

Balance, December 31, 2017
 
(5,180
)
 
(30
)
 
401

 
(5,262
)
 
750

 
(9,321
)
Other comprehensive income/(loss) due to the adoption of new accounting standards(b)
 
(2
)
 
(1
)
 
(416
)
 
(637
)
 
144

 
(913
)
Other comprehensive income/(loss)(a)
 
(893
)
 
198

 
(53
)
 
(128
)
 
(166
)
 
(1,041
)
Balance, December 31, 2018
 
$
(6,075
)
 
$
167

 
$
(68
)
 
$
(6,027
)
 
$
728

 
$
(11,275
)
(a) 
Amounts do not include foreign currency translation adjustments attributable to noncontrolling interests of $20 million loss in 2018, $14 million income in 2017 and $3 million loss in 2016.
(b) 
Amounts represent the cumulative effect adjustments as of January 1, 2018 from the adoption of new accounting standards related to (i) financial assets and liabilities and (ii) the reclassification of certain tax effects from AOCI. For additional information, see Note 1B.
As of December 31, 2018, we estimate that we will reclassify into 2019 income the following pre-tax amounts currently held in Accumulated other comprehensive loss: $258 million of unrealized pre-tax net gains on derivative financial instruments (which is expected to be offset primarily by net losses resulting from reclassification adjustments related to net losses related to foreign currency exchange-denominated forecasted intercompany inventory sales and available-for-sale debt securities); $242 million of actuarial losses related to benefit plan obligations and plan assets and other benefit plan items; and $186 million of prior service credits, primarily related to benefit plan amendments.
v3.10.0.1
Financial Instruments
 12 Months Ended
Dec. 31, 2018
Financial Instruments [Abstract]  
Financial Instruments
Financial Instruments
A. Fair Value Measurements

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis
On January 1, 2018, we adopted a new accounting and disclosure standard related to accounting for the recognition of financial assets and liabilities. For additional information see Note 1B.
The following table presents the financial assets and liabilities measured at fair value using a market approach on a recurring basis by balance sheet categories and fair value hierarchy level as defined in Note 1E:
 
 
December 31, 2018
 
December 31, 2017
(MILLIONS OF DOLLARS)
 
Total

 
Level 1

 
Level 2

 
Total

 
Level 1

 
Level 2

Financial assets measured at fair value on a recurring basis:
 
 
 
 
 
 
 
 
 
 
 
 
Short-term investments
 
 
 
 
 
 
 
 
 
 
 
 
Classified as equity securities:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
$
1,571

 
$
—

 
$
1,571

 
$
2,115

 
$
—

 
$
2,115

Equity(a)
 
29

 
17

 
11

 
35

 
16

 
19

 
 
1,600

 
17

 
1,583

 
2,150

 
16

 
2,134

Classified as available-for-sale debt securities:
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency—non-U.S.
 
9,609

 
—

 
9,609

 
12,242

 
—

 
12,242

Corporate and other
 
5,482

 
—

 
5,482

 
3,120

 
—

 
3,120

 
 
15,091

 
—

 
15,091

 
15,362

 
—

 
15,362

Total short-term investments
 
16,691

 
17

 
16,674

 
17,512

 
16

 
17,496

Other current assets
 
 
 
 
 
 
 
 
 
 
 
 
Derivative assets:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
97

 
—

 
97

 
104

 
—

 
104

Foreign exchange contracts
 
477

 
—

 
477

 
234

 
—

 
234

Total other current assets
 
574

 
—

 
574

 
337

 
—

 
337

Long-term investments
 
 
 
 
 
 
 
 
 
 
 
 
Classified as equity securities:
 
 
 
 
 
 
 
 
 
 
 
 
Equity(a)
 
1,223

 
1,193

 
30

 
1,440

 
1,398

 
42

Classified as trading securities:
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
50

 
50

 
—

 
73

 
73

 
—

 
 
1,273

 
1,243

 
30

 
1,514

 
1,472

 
42

Classified as available-for-sale debt securities:
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency—non-U.S.
 
94

 
—

 
94

 
387

 
—

 
387

Corporate and other
 
397

 
—

 
397

 
4,702

 
36

 
4,667

 
 
491

 
—

 
491

 
5,090

 
36

 
5,054

Total long-term investments
 
1,764

 
1,243

 
521

 
6,603

 
1,507

 
5,096

Other noncurrent assets
 
 
 
 
 
 
 
 
 
 
 
 
Derivative assets:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
335

 
—


335

 
477

 
—

 
477

Foreign exchange contracts
 
232

 
—


232

 
7

 
—

 
7

Total other noncurrent assets
 
566

 
—


566

 
484

 
—

 
484

Total assets
 
$
19,595

 
$
1,260


$
18,335

 
$
24,937

 
$
1,523

 
$
23,414

 
 
 
 
 
 
 
 
 
 
 
 
 
Financial liabilities measured at fair value on a recurring basis:
 
 
 
 
 
 
 
 
 
 
 
 
Other current liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
$
5

 
$
—

 
$
5

 
$
1

 
$
—

 
$
1

Foreign exchange contracts
 
78

 
—

 
78

 
201

 
—

 
201

Total other current liabilities
 
82

 
—

 
82

 
201

 
—

 
201

Other noncurrent liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
378

 
—

 
378

 
177

 
—

 
177

Foreign exchange contracts
 
564

 
—

 
564

 
313

 
—

 
313

Total other noncurrent liabilities
 
942

 
—

 
942

 
490

 
—

 
490

Total liabilities
 
$
1,024

 
$
—

 
$
1,024

 
$
691

 
$
—

 
$
691

(a) 
As of December 31, 2018, short-term equity securities of $11 million and long-term equity securities of $29 million are held in trust for benefits attributable to the former Pharmacia Savings Plus Plan. As of December 31, 2017, short-term equity securities of $19 million and long-term equity securities of $42 million are held in trust for benefits attributable to the former Pharmacia Savings Plus Plan.
Financial Assets and Liabilities Not Measured at Fair Value on a Recurring Basis
The following table presents the financial liabilities not measured at fair value on a recurring basis, including the carrying values and estimated fair values using a market approach:
 
 
December 31, 2018
 
December 31, 2017
 
 
Carrying Value

 
Estimated Fair Value
 
Carrying Value
 
Estimated Fair Value
(MILLIONS OF DOLLARS)
 
 
 
Total

 
Level 2

 
 
 
Total

 
Level 2

Financial Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Long-term debt, excluding the current portion
 
$
32,909

 
$
35,260

 
$
35,260

 
$
33,538

 
$
37,253

 
$
37,253


The differences between the estimated fair values and carrying values of held-to-maturity debt securities, restricted stock and private equity securities, and short-term borrowings not measured at fair value on a recurring basis were not significant as of December 31, 2018 or December 31, 2017. The fair value measurements of our held-to-maturity debt securities and our short-term borrowings are based on Level 2 inputs. The fair value measurements of our private equity securities, which represent investments in the life sciences sector, are based on Level 3 inputs using a market approach.

In addition, as of December 31, 2018 and 2017, we had long-term receivables whose fair value is based on Level 3 inputs. As of December 31, 2018 and 2017, the differences between the estimated fair values and carrying values of these receivables were not significant.
Total Short-Term and Long-Term Investments
The following table represents our investments by classification type:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018
 
2017
Short-term investments
 
 
 
 
Equity securities
 
$
1,600

 
$
2,150

Available-for-sale debt securities
 
15,091

 
15,362

Held-to-maturity debt securities
 
1,003

 
1,138

Total Short-term investments
 
$
17,694

 
$
18,650

 
 
 
 
 
Long-term investments
 
 
 
 
Equity securities
 
$
1,223

 
$
1,440

Trading equity securities
 
50

 
73

Available-for-sale debt securities
 
491

 
5,090

Held-to-maturity debt securities
 
59

 
4

Private equity investments carried at equity-method or cost
 
944

 
408

Total Long-term investments
 
$
2,767

 
$
7,015

Held-to-maturity cash equivalents
 
$
199

 
$
719



Fair Value Methodology
The following inputs and valuation techniques were used to estimate the fair value of our financial assets and liabilities:
•
Trading debt securities—quoted market prices.
•
Available-for-sale debt securities—third-party matrix-pricing model that uses significant inputs derived from or corroborated by observable market data and credit-adjusted interest rate yield curves.
•
Equity securities—quoted market prices and observable net asset value prices.
•
Derivative assets and liabilities (financial instruments)—third-party matrix-pricing model that uses significant inputs derived from or corroborated by observable market data. Where applicable, these models discount future cash flow amounts using market-based observable inputs, including interest rate yield curves, and forward and spot prices for currencies. The credit risk impact to our derivative financial instruments was not significant.
•
Money market funds—observable net asset value prices.
We periodically review the methodologies, inputs and outputs of third-party pricing services for reasonableness. Our procedures can include, for example, referencing other third-party pricing models, monitoring key observable inputs (like LIBOR interest rates) and selectively performing test-comparisons of values with actual sales of financial instruments.
B. Investments
At December 31, 2018 and 2017, the investment securities portfolio consisted of debt securities that were virtually all investment-grade.
Information on investments in debt and equity securities at December 31, 2018 and December 31, 2017 is as follows, including, as of December 31, 2018, the contractual maturities, or as necessary, the estimated maturities, of the available-for-sale and held-to-maturity debt securities:
 
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Gross Unrealized
 
 
 
Maturities (in Years)
 
 
 
 
Gross Unrealized
 
 
 
(MILLIONS OF DOLLARS)
 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

 
Within 1

 
Over 1
to 5

 
Over 5

 
Total

 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

Available-for-sale debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency––non-U.S.
 
$
9,754

 
$
7

 
$
(58
)
 
$
9,703

 
$
9,609

 
$
94

 
$
—

 
$
9,703

 
$
12,616

 
$
61

 
$
(48
)
 
$
12,629

Corporate and other(a)
 
5,905

 
—

 
(27
)
 
5,878

 
5,482

 
394

 
3

 
5,878

 
7,859

 
15

 
(52
)
 
7,823

Held-to-maturity debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Time deposits and other
 
668

 
—

 
—

 
668

 
610

 
24

 
35

 
668

 
1,091

 
—

 
—

 
1,091

Government and agency––non-U.S.
 
592

 
—

 
—

 
592

 
592

 
—

 
—

 
592

 
770

 
—

 
—

 
770

Total debt securities
 
$
16,920

 
$
8

 
$
(85
)
 
$
16,842

 
$
16,293

 
$
512

 
$
38

 
$
16,842

 
$
22,337

 
$
77

 
$
(100
)
 
$
22,313

Available-for-sale equity securities(b)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,115

 
$
—

 
$
—

 
$
2,115

Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
728

 
586

 
(124
)
 
1,190

Total available-for-sale equity securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,843

 
$
586

 
$
(124
)
 
$
3,304

(a) 
Primarily issued by a diverse group of corporations.
(b) 
Upon the 2018 adoption of a new accounting standard related to financial assets and liabilities, available-for-sale equity securities were classified as equity securities. For additional information see Note 1B.
The following table presents the net unrealized gains and losses for the period that relate to equity securities still held at the reporting date, calculated as follows:
(MILLIONS OF DOLLARS)
 
December 31, 2018

Net gains recognized during the period on investments in equity securities(a)
 
$
586

Less: Net gains recognized during the period on equity securities sold during the period
 
(109
)
Net unrealized gains during the reporting period on equity securities still held at the reporting date
 
$
477

(a) 
The net gains on investments in equity securities are reported in Other (income)/deductions––net and, for 2018, include unrealized net gains on equity securities reflecting the adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 4.
C. Short-Term Borrowings
Short-term borrowings include:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018
 
2017
Commercial paper
 
$
3,100

 
$
6,100

Current portion of long-term debt, principal amount(a) 
 
4,781

 
3,532

Other short-term borrowings, principal amount(b)
 
966

 
320

Total short-term borrowings, principal amount
 
8,847

 
9,951

Net fair value adjustments related to hedging and purchase accounting
 
(5
)
 
14

Net unamortized discounts, premiums and debt issuance costs
 
(11
)
 
(12
)
Total Short-term borrowings, including current portion of long-term debt, carried at historical proceeds, as adjusted
 
$
8,831

 
$
9,953

(a) 
For additional information, see Note 7D.
(b) 
Other short-term borrowings primarily include cash collateral. For additional information, see Note 7F.

The weighted-average effective interest rate on commercial paper outstanding was approximately 2.42% as of December 31, 2018 and 1.36% as of December 31, 2017.
On June 24, 2016, we acquired Anacor and assumed its short-term debt with an acquisition date fair value of $698 million, which was redeemed in the second and third quarters of 2016.
As of December 31, 2018, we had access to a $7.0 billion U.S. revolving credit facility expiring in 2023, which may be used to support our commercial paper borrowings. In addition to the U.S. revolving credit facility, our lenders have provided us an additional $553 million lines of credit, of which $502 million expire within one year. Of these total lines of credit, $7.5 billion were unused as of December 31, 2018.
D. Long-Term Debt

New Issuances
In 2018, we issued the following senior unsecured notes:
(MILLIONS OF DOLLARS)
 
 
 
 
Maturity Date
 
Interest Rate
 
Principal
September 2021
 
3.000% notes(a)
 
$
1,000

September 2023
 
Floating rate notes (LIBOR plus 0.33%)(b)
 
300

September 2023
 
3.200% notes(a)
 
1,000

September 2028
 
3.600% notes(a)
 
1,000

September 2038
 
4.100% notes(a)
 
700

September 2048
 
4.200% notes(a)
 
1,000

Total long-term debt issued(c)
 
$
5,000

(a) 
Fixed rate notes may be redeemed by us at any time, in whole, or in part, at varying redemption prices plus accrued and unpaid interest.
(b) 
Floating rate notes may not be redeemed by their terms prior to maturity.
(c) 
The weighted-average effective interest rate for the notes at issuance was 3.56%.
In March 2017, we completed a public offering of $1.065 billion principal amount of senior unsecured notes due 2047 with an interest rate of 4.20%, and also in March 2017, we completed a public offering of €4.0 billion principal amount of senior unsecured notes with a weighted-average effective interest rate of 0.23%.
On November 21, 2016, we completed a public offering of $6.0 billion aggregate principal amount of senior unsecured notes with a weighted-average effective interest rate of 3.10%.
On June 3, 2016, we completed a public offering of $5.0 billion aggregate principal amount of senior unsecured notes with a weighted-average effective interest rate of 2.09%.

Retirements
In January 2019, we repurchased all €1.1 billion principal amount outstanding of the 5.75% euro-denominated debt that was due June 2021 before the maturity date at a redemption value of €1.3 billion. As a result, we recorded a net loss of approximately $138 million, which included the related termination of cross-currency swaps, and that was recorded in Other (income)/deductions––net in the consolidated statement of income in the first quarter of 2019.

In December 2017, we exchanged approximately £833 million and repurchased £197 million principal amount of the outstanding 6.50% debt before the maturity date at a redemption value of £1.7 billion, leaving £470 million principal amount of the 6.50% debt due 2038 outstanding. Also, in December 2017, we repurchased approximately €834 million principal amount of the outstanding 5.75% debt before the maturity date at a redemption value of €1.0 billion, leaving approximately €1.2 billion of the 5.75% euro-denominated debt due 2021 outstanding as of December 31, 2017. As a result, we recorded a net loss of approximately $846 million and $153 million upon the exchange and early retirement of the U.K. pound-denominated debt and the early retirement of the euro-denominated debt, respectively, for a net loss on early retirement of debt of $999 million. which included the related termination of cross-currency swaps, and that were recorded in Other (income)/deductions––net in the consolidated statement of income (see Note 4).

In November 2016, we repurchased $3.4 billion carrying value of outstanding debt before the maturity date at a redemption value of $3.7 billion. The debt repurchased included $3.27 billion carrying value of 6.20% senior notes due March 2019. As a result, we recorded a total net loss of approximately $312 million upon the early redemption of debt, which included the related termination of interest rate swaps, and which was recorded in Other (income)/deductions––net in the consolidated statement of income (see Note 4).
The following table provides the components of our senior unsecured long-term debt, including the weighted-average stated interest rate for 2018 and 2017 by maturity:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Notes due 2019 (1.3%)(a)
 
$
—

 
$
4,848

Notes due 2020 (1.2% and 1.1%)
 
1,474

 
1,528

Notes due 2021 (3.4% and 3.5%)
 
4,459

 
3,550

Notes due 2022 (0.3%)
 
1,145

 
1,199

Notes due 2023 (3.6% and 4.3%)
 
2,892

 
1,592

Notes due 2024 (4.4%)
 
1,500

 
1,500

Notes due 2026-2028 (3.3% and 3.2%)
 
5,718

 
4,759

Notes due 2034 (6.5%)
 
750

 
750

Notes due 2036-2039 (6.0% and 6.2%)
 
7,301

 
6,636

Notes due 2040-2044 (3.8%)
 
4,004

 
4,106

Notes due 2046-2048 (4.2%)
 
3,315

 
2,315

Total long-term debt, principal amount
 
32,558

 
32,783

Net fair value adjustments related to hedging and purchase accounting
 
479

 
872

Net unamortized discounts, premiums and debt issuance costs
 
(136
)
 
(125
)
Other long-term debt
 
7

 
8

Total long-term debt, carried at historical proceeds, as adjusted
 
$
32,909

 
$
33,538

Current portion of long-term debt, carried at historical proceeds (not included above (1.3% and 2.4%))
 
$
4,776

 
$
3,546

(a) 
At December 31, 2018, the debt issuances have been reclassified to the current portion of long-term debt.

Our long-term debt, provided in the above table, is generally redeemable by us at any time at varying redemption prices plus accrued and unpaid interest.
E. Other Noncurrent Liabilities

Mylotarg (gemtuzumab ozogamicin)
In April 2018, the EU approved Mylotarg for the treatment of acute myeloid leukemia. In connection with the EU approval, we incurred an obligation to make guaranteed fixed annual payments over a ten-year period aggregating $301 million related to an R&D arrangement. We recorded the estimated net present value of $240 million as a liability and an intangible asset in Developed technology rights as of the approval date. In June 2018, we entered into a transaction with the obligee to buyout the remaining liability for the fixed annual payments for a lump sum payment of $224 million. As a result of the buyout transaction, the liability was extinguished and we recognized a non-cash $17 million pre-tax gain in Other (income)/deductions––net in the second quarter of 2018 (see Note 4).
Bosulif (bosutinib)
In December 2017, the U.S. FDA approved Bosulif for the treatment of patients with newly-diagnosed chronic-phase Ph+ CML. In connection with the U.S. approval, we incurred an obligation to make guaranteed fixed annual payments over a ten-year period aggregating $416 million related to an R&D arrangement. We recorded the estimated net present value of $364 million as of the approval date as an intangible asset in Developed technology rights. In August 2018, we entered into a transaction with the obligee to buyout a portion of the remaining liability for the fixed annual payments for a lump sum payment of $71 million. As a result of the buyout transaction, the liability was reduced and we recognized a non-cash $9 million pre-tax gain in Other (income)/deductions––net in the third quarter of 2018. The present value of the remaining future payments as of December 31, 2018 is $209 million, of which $23 million is recorded in Other current liabilities and $186 million is recorded in Other noncurrent liabilities.
Besponsa (inotuzumab ozogamicin)
In August 2017, the U.S. FDA approved Besponsa and in June 2017, the EU approved Besponsa as monotherapy for the treatment of adults with relapsed or refractory CD22-positive B-cell precursor acute lymphoblastic leukemia. In connection with the U.S. approval, we incurred an obligation to make guaranteed fixed annual payments over a nine-year period aggregating $296 million related to an R&D arrangement. We recorded the estimated net present value of $248 million as of the approval date as an intangible asset in Developed technology rights. The present value of the remaining future payments as of December 31, 2018 is $243 million, of which $7 million is recorded in Other current liabilities and $235 million is recorded in Other noncurrent liabilities. In connection with the EU approval, we incurred an obligation to make guaranteed fixed annual payments over a nine-year period aggregating $148 million related to an R&D arrangement. We recorded the estimated net present value of $123 million as of the approval date as an intangible asset in Developed technology rights. The present value of the remaining future payments as of December 31, 2018 is $122 million, of which $3 million is recorded in Other current liabilities and $119 million is recorded in Other noncurrent liabilities.

The differences between the estimated fair values, using a market approach in the Level 2 fair value hierarchy, and carrying values of these obligations were not significant as of December 31, 2018.
F. Derivative Financial Instruments and Hedging Activities

We adopted a new accounting standard in the first quarter of 2018, as of January 2018. For additional information, see Note 1B.

Foreign Exchange Risk

A significant portion of our revenues, earnings and net investments in foreign affiliates is exposed to changes in foreign exchange rates. We manage our foreign exchange risk, in part, through operational means, including managing same-currency revenues in relation to same-currency costs and same-currency assets in relation to same-currency liabilities. We also manage our foreign exchange risk, depending on market conditions, through fair value, cash flow, and net investment hedging programs through the use of derivative financial instruments and foreign currency debt. These financial instruments serve to protect net income against the impact of remeasurement into another currency, or against the impact of translation into U.S. dollars of certain foreign exchange-denominated transactions.

All derivative financial instruments used to manage foreign currency risk are measured at fair value and are reported as assets or liabilities on the consolidated balance sheet. The derivative financial instruments primarily hedge or offset exposures in the euro, U.K. pound, Japanese yen, Swedish krona and Chinese Renminbi. Changes in fair value are reported in earnings or in Other comprehensive income/(loss), depending on the nature and purpose of the financial instrument (hedge or offset relationship) and the effectiveness of the hedge relationships, as follows:
•
Generally, we recognize the gains and losses on foreign exchange contracts that are designated as fair value hedges in earnings upon the recognition of the change in fair value of the hedged risk. Upon the adoption of the new standard in 2018, for certain foreign exchange contracts, we exclude an amount from the assessment of hedge effectiveness and recognize that excluded amount through an amortization approach. We also recognize the offsetting foreign exchange impact attributable to the hedged item in earnings.
•
Generally, we record in Other comprehensive income/(loss) gains or losses on foreign exchange contracts that are designated as cash flow hedges and reclassify those amounts, as appropriate, into earnings in the same period or periods during which the hedged transaction affects earnings. Upon the adoption of the new standard in 2018, for certain foreign exchange contracts, we exclude an amount from the assessment of hedge effectiveness and recognize that excluded amount through an amortization approach.
•
Upon the adoption of the new standard in 2018, for foreign exchange contracts, we exclude an amount from the assessment of hedge effectiveness and recognize that excluded amount through an amortization approach. We record in Other comprehensive income/(loss) the foreign exchange gains and losses related to foreign exchange-denominated debt designated as a hedge of our net investments in foreign subsidiaries and reclassify those amounts into earnings upon the sale or substantial liquidation of our net investments. Historically, as part of our net investment hedging program, we recognized the gain and loss impact on foreign exchange contracts designated as hedges of our net investments in earnings in three ways: over time––for the periodic net swap payments; immediately––to the extent of any change in the difference between the foreign exchange spot rate and forward rate; and upon sale or substantial liquidation of our net investments––to the extent of change in the foreign exchange spot rates.
•
For certain foreign exchange contracts not designated as hedging instruments, we recognize the gains and losses on foreign currency exchange contracts that are used to offset the same foreign currency assets or liabilities immediately into earnings along with the earnings impact of the items they generally offset. These contracts essentially take the opposite currency position of that reflected in the month-end balance sheet to counterbalance the effect of any currency movement.
As a part of our cash flow hedging program, we designate foreign exchange contracts to hedge a portion of our forecasted euro, Japanese yen, Chinese renminbi, Canadian dollar, U.K. pound and Australian dollar-denominated intercompany inventory sales expected to occur no more than two years from the date of each hedge.
For 2017, any ineffectiveness is recognized immediately into earnings. There is no significant ineffectiveness for 2017.

Interest Rate Risk

Our interest-bearing investments and borrowings are subject to interest rate risk. With respect to our investments, we strive to maintain a predominantly floating-rate basis position, but our strategy may change based on prevailing market conditions. We currently borrow primarily on a long-term, fixed-rate basis. Historically, we strove to borrow primarily on a floating-rate basis; but in recent years we borrowed on a long-term fixed-rate basis. From time to time, depending on market conditions, we will change the profile of our outstanding debt by entering into derivative financial instruments like interest rate swaps. We entered into derivative financial instruments to hedge or offset the fixed interest rates on the hedged item, matching the amount and timing of the hedged item. The derivative financial instruments primarily hedge U.S. dollar fixed-rate debt.

All derivative contracts used to manage interest rate risk are measured at fair value and reported as assets or liabilities on the consolidated balance sheet. Changes in fair value are reported in earnings, as follows:
•
We recognize the gains and losses on interest rate contracts that are designated as fair value hedges in earnings upon the recognition of the change in fair value of the hedged risk. We also recognize the offsetting earnings impact of fixed-rate debt attributable to the hedged risk in earnings.
For 2017, any ineffectiveness is recognized immediately into earnings. There is no significant ineffectiveness for 2017.
The following table provides the fair value of the derivative financial instruments and the related notional amounts presented between those derivatives that are designated as hedging instruments and those that are not designated as hedging instruments:
(MILLIONS OF DOLLARS)
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Fair Value
 
 
 
Fair Value
 
 
Notional
 
Asset
 
Liability
 
Notional
 
Asset
 
Liability
Derivatives designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts(a)
 
$
22,984

 
$
654

 
$
586

 
$
18,723

 
$
179

 
$
459

Interest rate contracts
 
11,145

 
432

 
383

 
12,430

 
581

 
178

 
 
 
 
1,085

 
968

 
 
 
760

 
637

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
$
15,154

 
55

 
55

 
$
14,300

 
62

 
54

 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
 
 
$
1,140

 
$
1,024

 
 
 
$
822

 
$
691

(a) 
As of December 31, 2018, the notional amount of outstanding foreign currency forward-exchange contracts hedging our intercompany forecasted inventory sales was $5.8 billion.
The following table provides information about the gains/(losses) incurred to hedge or offset operational foreign exchange or interest rate risk:
 
 
Amount of
Gains/(Losses)
Recognized in OID(a), (b)
 
Amount of Gains/(Losses)
Recognized in OCI(a), (c)
 
Amount of Gains/(Losses)
Reclassified from
OCI into OID and COS(a), (c)
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Derivative Financial Instruments in Cash Flow Hedge Relationships:
 
 

 
 

 
 

 
 

 
 

 
 

Foreign exchange contracts(d)
 
$
—

 
$
(6
)
 
$
80

 
$
(12
)
 
$
(182
)
 
$
520

Amount excluded from effectiveness testing recognized in earnings based on an amortization approach
 
—

 
 

 
140

 
 

 
153

 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Financial Instruments in Fair Value Hedge Relationships:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
(348
)
 
(60
)
 
—

 
—

 
—

 
—

Hedged item gain
 
348

 
60

 
—

 
—

 
—

 
—

Foreign exchange contracts
 
5

 
(19
)
 
—

 
—

 
—

 
—

Hedged item gain/(loss)
 
(5
)
 
19

 
—

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Financial Instruments in Net Investment Hedge Relationships:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
—

 
—

 
175

 
—

 
—

 
—

The portion of gains/(losses) on foreign exchange contracts excluded from the assessment of hedge effectiveness
 
—

 
 

 
77

 
 

 
68

 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
Non-Derivative Financial Instruments in Net Investment Hedge Relationships:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency short-term borrowings
 
—

 
—

 
68

 
—

 
—

 
—

Foreign currency long-term debt(e)
 
—

 
—

 
149

 
(580
)
 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Financial Instruments Not Designated as Hedges:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
136

 
(87
)
 
—

 
—

 
—

 
—

All other net
 
—

 
—

 
(1
)
 
2

 
2

 
1

 
 
$
136

 
$
(93
)
 
$
688

 
$
(591
)
 
$
41

 
$
520


(a) 
OID = Other (income)/deductions—net, included in Other (income)/deductions—net in the consolidated statements of income. COS = Cost of Sales, included in Cost of sales in the consolidated statements of income. OCI = Other comprehensive income/(loss), included in the consolidated statements of comprehensive income.
(b) 
For 2017, there is no significant ineffectiveness.
(c) 
For derivative financial instruments in cash flow hedge relationships, the gains and losses are included in Other comprehensive income/(loss)––Unrealized holding gains/(losses) on derivative financial instruments, net. For derivative financial instruments in net investment hedge relationships and for foreign currency debt designated as hedging instruments, the effective portion is included in Other comprehensive income/(loss)––Foreign currency translation adjustments, net.
(d) 
Based on year-end foreign exchange rates that are subject to change, we expect to reclassify a pre-tax gain of $156 million within the next 12 months into Cost of sales. The maximum length of time over which we are hedging future foreign exchange cash flow relates to our $1.8 billion U.K. pound debt maturing in 2043.
(e) 
Short-term borrowings include foreign currency short-term borrowings with carrying values of $1.4 billion as of December 31, 2018, which are used as hedging instruments in net investment hedges. Long-term debt includes foreign currency long-term borrowings with carrying values of $3.2 billion as of December 31, 2018, which are used as hedging instruments in net investment hedges.
The following table provides the total amount of each income and expense line in which the results of fair value or cash flow hedges are recorded:
(MILLIONS OF DOLLARS)
 
December 31, 2018

Cost of sales
 
$
11,248

Other (income)/deductions—net
 
2,116


The following table provides the amounts recorded in our consolidated balance sheet related to cumulative basis adjustments for fair value hedges:
 
 
Carrying Amount of Hedged Assets/Liabilities

 
Cumulative Amount of Fair Value Hedging Adjustment Gains/(Losses) Included in the Carrying Amount of the Hedged Assets/Liabilities

(MILLIONS OF DOLLARS)
 
December 31, 2018

 
December 31, 2018

Long-term investments
 
$
45

 
$
(1
)
Short-term borrowings, including current portion of long-term debt
 
1,499

 
5

Long-term debt
 
9,952

 
45


Certain of our derivative instruments are covered by associated credit-support agreements that have credit-risk-related contingent features designed to reduce both counterparties’ exposure to risk of defaulting on amounts owed by the other party. As of December 31, 2018, the aggregate fair value of these derivative instruments that are in a net liability position was $472 million, for which we have posted collateral of $544 million in the normal course of business. If there had been a downgrade to below an A rating by S&P or the equivalent rating by Moody’s, we would not have been required to post any additional collateral to our counterparties.
As of December 31, 2018, we received cash collateral of $881 million from various counterparties. The collateral primarily supports the approximate fair value of our derivative contracts. With respect to the collateral received, the obligations are reported in Short-term borrowings, including current portion of long-term debt.
G. Credit Risk

On an ongoing basis, we review the creditworthiness of counterparties to our foreign exchange and interest rate agreements and do not expect to incur a significant loss from failure of any counterparties to perform under the agreements. There are no significant concentrations of credit risk related to our financial instruments with any individual counterparty, except for certain significant customers. For additional information, see Note 18C. As of December 31, 2018, we had amounts due from a well-diversified, high quality group of banks ($4.4 billion) from around the world. For details about our investments, see Note 7B above.

In general, there is no requirement for collateral from customers. However, derivative financial instruments are executed under credit-support agreements that provide for the ability to request to receive cash collateral, depending on levels of exposure, our credit rating and the credit rating of the counterparty, see Note 7F above.
v3.10.0.1
Inventories
 12 Months Ended
Dec. 31, 2018
Inventory Disclosure [Abstract]  
Inventories
Inventories
The following table provides the components of Inventories:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Finished goods
 
$
2,262

 
$
2,883

Work in process
 
4,701

 
3,908

Raw materials and supplies
 
546

 
788

Inventories(a)
 
$
7,508

 
$
7,578

Noncurrent inventories not included above(b)
 
$
618

 
$
683

(a) 
The change from December 31, 2017 primarily reflects the reclassification of $538 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and a decrease due to foreign exchange, partially offset by increases for certain products to meet targeted levels in the normal course of business, primarily for inventory build for supply recovery, new product launches and the movement of products within our manufacturing network.
(b) 
Included in Other noncurrent assets. There are no recoverability issues associated with these amounts.
v3.10.0.1
Property, Plant and Equipment
 12 Months Ended
Dec. 31, 2018
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment
Property, Plant and Equipment
The following table provides the components of Property, plant and equipment:
 
 
Useful Lives
 
As of December 31,
(MILLIONS OF DOLLARS)
 
(Years)  
 
2018

 
2017

Land
 
-
 
$
500

 
$
540

Buildings
 
33-50
 
9,920

 
10,254

Machinery and equipment
 
8-20
 
11,871

 
11,902

Furniture, fixtures and other
 
3-12 1/2
 
4,693

 
4,661

Construction in progress
 
-
 
2,992

 
2,680

 
 
 
 
29,977

 
30,037

Less: Accumulated depreciation
 
 
 
16,591

 
16,172

Property, plant and equipment(a)
 
 
 
$
13,385

 
$
13,865

(a) 
The decrease in total property, plant and equipment is primarily due to depreciation, the reclassification of $675 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C), reductions due to asset impairments largely associated with cost reduction initiatives not associated with acquisitions (see Note 3), and the impact of foreign exchange, partially offset by capital additions.
v3.10.0.1
Identifiable Intangible Assets and Goodwill
 12 Months Ended
Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]  
Identifiable Intangible Assets and Goodwill
Identifiable Intangible Assets and Goodwill

A. Identifiable Intangible Assets

Balance Sheet Information
The following table provides the components of Identifiable intangible assets:
 
 
December 31, 2018
 
December 31, 2017
(MILLIONS OF DOLLARS)
 
Gross
Carrying
Amount

 
Accumulated
Amortization

 
Identifiable
Intangible
Assets, less
Accumulated
Amortization

 
Gross
Carrying
Amount

 
Accumulated
Amortization

 
Identifiable
Intangible
Assets, less
Accumulated
Amortization

Finite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Developed technology rights(a)
 
$
89,430

 
$
(58,895
)
 
$
30,535

 
$
89,550

 
$
(54,785
)
 
$
34,765

Brands(a)
 
923

 
(708
)
 
215

 
2,134

 
(1,152
)
 
982

Licensing agreements and other
 
1,436

 
(1,140
)
 
296

 
1,911

 
(1,096
)
 
815

 
 
91,788

 
(60,743
)
 
31,045

 
93,595

 
(57,033
)
 
36,562

Indefinite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Brands and other(a)
 
1,994

 


 
1,994

 
6,929

 


 
6,929

IPR&D(a)
 
2,171

 


 
2,171

 
5,249

 


 
5,249

 
 
4,165

 


 
4,165

 
12,179

 


 
12,179

Identifiable intangible assets(b)
 
$
95,954

 
$
(60,743
)
 
$
35,211

 
$
105,774

 
$
(57,033
)
 
$
48,741

(a) 
The changes in the gross carrying amount of Developed technology rights, Brands, Brands and other and IPR&D primarily reflect (i) the reclassification of $6.1 billion of Brands and Brands and other to Assets held for sale during the fourth quarter of 2018 (see Note 2C), (ii) the transfer of $2.7 billion from IPR&D to Developed technology rights to reflect the approval of Xtandi in the U.S. for the treatment of men with non-metastatic castration-resistant prostate cancer, which is being developed through a collaboration with Astellas (see Note 2A), (iii) $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E), as well as impairments of $2.9 billion of Developed technology rights (see Note 4).
(b) 
The decrease in Identifiable intangible assets, less accumulated amortization, is primarily due to the reclassification of $5.8 billion of intangible assets, net, ($6.3 billion total gross carrying amount) to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and amortization and impairments, partially offset by additions, mainly consisting of $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E).
Our identifiable intangible assets are associated with the following, as a percentage of total identifiable intangible assets, less accumulated amortization:
 
 
December 31, 2018
 
 
IH
 
EH
 
WRD
Developed technology rights
 
76
%
 
24
%
 
—

Brands, finite-lived
 
—

 
100
%
 
—

Brands, indefinite-lived
 
—

 
100
%
 
—

IPR&D
 
65
%
 
18
%
 
17
%


Developed Technology Rights

Developed technology rights represent the amortized cost associated with developed technology, which has been acquired from third parties and which can include the right to develop, use, market, sell and/or offer for sale the product, compounds and intellectual property that we have acquired with respect to products, compounds and/or processes that have been completed. We possess a well-diversified portfolio of hundreds of developed technology rights across therapeutic categories, representing the commercialized products included in our biopharmaceutical businesses. The more significant components of developed technology rights are the following (in order of significance): Xtandi, Prevnar 13/Prevenar 13 Infant, Eucrisa, Premarin, Prevnar 13/Prevenar 13 Adult, Enbrel and, to a lesser extent Tygacil, Pristiq, Refacto AF and Bosulif. Also included in this category are the post-approval milestone payments made under our alliance agreements for certain biopharmaceutical products.

Brands

Brands represent the amortized or unamortized cost associated with tradenames and know-how, as the products themselves do not receive patent protection. The more significant components of indefinite-lived brands are the following (in order of significance): Xanax, Medrol and Depo-Medrol. The more significant components of finite-lived brands are the following (in order of significance): Depo-Provera and Zavedos.

IPR&D

IPR&D assets represent R&D assets that have not yet received regulatory approval in a major market. A significant component of IPR&D at December 31, 2018 is the program for the oral PARP inhibitor for the treatment of patients with germline BRCA-mutated advanced breast cancer acquired as part of the Medivation acquisition. IPR&D assets are required to be classified as indefinite-lived assets until the successful completion or the abandonment of the associated R&D effort. Accordingly, during the development period after the date of acquisition, these assets will not be amortized until approval is obtained in a major market, typically either the U.S. or the EU, or in a series of other countries, subject to certain specified conditions and management judgment. At that time, we will determine the useful life of the asset, reclassify the asset out of IPR&D and begin amortization. If the associated R&D effort is abandoned, the related IPR&D assets will likely be written-off, and we will record an impairment charge.

For IPR&D assets, the risk of failure is significant and there can be no certainty that these assets ultimately will yield successful products. The nature of the biopharmaceutical business is high-risk and, as such, we expect that many of these IPR&D assets will become impaired and be written off at some time in the future.

Amortization

The weighted-average life for each of our total finite-lived intangible assets and the largest component, developed technology rights, is approximately 9 years. Total amortization expense for finite-lived intangible assets was $5.0 billion in 2018, $4.8 billion in 2017 and $4.1 billion in 2016.
The following table provides the annual amortization expense expected for the years 2019 through 2023:
(MILLIONS OF DOLLARS)
 
2019

 
2020

 
2021

 
2022

 
2023

Amortization expense
 
$
4,581

 
$
3,552

 
$
3,467

 
$
3,217

 
$
2,920



B. Goodwill
The following table provides the components of and changes in the carrying amount of Goodwill:
(MILLIONS OF DOLLARS)
 
IH

 
EH

 
Total

Balance, January 1, 2017
 
$
30,134

 
$
24,315

 
$
54,449

Additions(a)
 
572

 
92

 
664

Other(b)
 
435

 
404

 
840

Balance, December 31, 2017
 
31,141

 
24,811

 
55,952

Other(c)
 
(2,264
)
 
(277
)
 
(2,541
)
Balance, December 31, 2018
 
$
28,877

 
$
24,534

 
$
53,411

(a) 
IH additions primarily represent measurement period adjustments related to our Medivation acquisition, and EH additions relate to our acquisition of AstraZeneca’s small molecule anti-infectives business (see Note 2A).
(b) 
Primarily reflects the impact of foreign exchange and an adjustment of our estimate of goodwill associated with the HIS net assets sold.
(c) 
Primarily reflects the impact of the reclassification of $2.0 billion to Assets held for sale during the fourth quarter of 2018 (see Note 2C), foreign exchange and the contribution of the allogeneic CAR T developmental program assets and operations to Allogene that constituted a business for accounting purposes (see Note 2B).
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans
 12 Months Ended
Dec. 31, 2018
Retirement Benefits [Abstract]  
Pension and Postretirement Benefit Plans and Defined Contribution Plans
Pension and Postretirement Benefit Plans and Defined Contribution Plans

The majority of our employees worldwide are eligible for retirement benefits provided through defined benefit pension plans, defined contribution plans or both. In the U.S., we sponsor both IRC-qualified and supplemental (non-qualified) defined benefit plans and defined contribution plans. A qualified plan meets the requirements of certain sections of the IRC, and, generally, contributions to qualified plans are tax deductible. A qualified plan typically provides benefits to a broad group of employees with restrictions on discriminating in favor of highly compensated employees with regard to coverage, benefits and contributions. A supplemental (non-qualified) plan provides additional benefits to certain employees. In addition, we provide medical insurance benefits to certain retirees and their eligible dependents through our postretirement plans.

A. Components of Net Periodic Benefit Costs and Changes in Other Comprehensive Loss
The following table provides the annual (income)/cost and changes in Other comprehensive income/(loss) for our benefit plans:
 
 
Year Ended December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S.
Qualified(a)
 
U.S.
Supplemental
(Non-Qualified)
 
International
 
Postretirement
Plans
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

Service cost(b)
 
$
—

 
$
269

 
$
257

 
$
—

 
$
24

 
$
18

 
$
136

 
$
171

 
$
165

 
$
39

 
$
42

 
$
41

Interest cost
 
598

 
634

 
646

 
55

 
54

 
53

 
212

 
204

 
233

 
72

 
90

 
101

Expected return on plan assets
 
(1,040
)
 
(1,005
)
 
(958
)
 
—

 
—

 
—

 
(360
)
 
(345
)
 
(381
)
 
(37
)
 
(36
)
 
(34
)
Amortization of:
 
 

 
 

 
 
 
 

 
 

 
 
 
 

 
 

 
 
 
 

 
 

 
 
Actuarial losses(b)
 
120

 
393

 
395

 
13

 
50

 
37

 
101

 
116

 
93

 
7

 
31

 
32

Prior service cost/(credits)
 
2

 
3

 
5

 
(1
)
 
(1
)
 
(1
)
 
(4
)
 
(4
)
 
(3
)
 
(178
)
 
(182
)
 
(174
)
Curtailments
 
12

 
13

 
10

 
1

 
1

 
1

 
(4
)
 
—

 
(2
)
 
(17
)
 
(19
)
 
(26
)
Settlements
 
113

 
75

 
90

 
26

 
39

 
28

 
4

 
4

 
9

 
—

 
—

 
—

Special termination benefits
 
6

 
—

 
—

 
10

 
—

 
—

 
—

 
1

 
1

 
2

 
—

 
—

Net periodic benefit costs/(income) reported in Income(c)
 
(189
)
 
382

 
444

 
103

 
166

 
137

 
84

 
147

 
115

 
(111
)
 
(75
)
 
(59
)
(Income)/cost reported in Other comprehensive income/(loss)(d)
 
361

 
141

 
253

 
(189
)
 
23

 
121

 
84

 
(301
)
 
640

 
105

 
(8
)
 
3

(Income)/cost recognized in Comprehensive income
 
$
171

 
$
523

 
$
697

 
$
(86
)
 
$
189

 
$
258

 
$
168

 
$
(154
)
 
$
755

 
$
(6
)
 
$
(83
)
 
$
(56
)
(a) 
In the second quarter of 2017, we settled the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. We purchased a group annuity contract on behalf of the remaining plan participants with a third-party insurance provider. As a result, we were relieved of the $156 million net pension benefit obligation and recorded a pretax settlement gain of $41 million, partially offset by the recognition of actuarial losses and prior service costs upon plan settlement of approximately $30 million in Other (income)/deductions—net (see Note 3).
(b) 
Effective January 1, 2018, we froze two significant defined benefit pension plans to future benefit accruals in the U.S. and U.K. and as a result, service costs for those plans are eliminated. In addition, due to the plan freeze, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans was extended to the expected life expectancy of the plan participants, whereas the average amortization period in prior years utilized the expected future service period of plan participants.
(c) 
We adopted a new accounting standard on January 1, 2018 that requires the net periodic pension and postretirement benefit costs other than service costs be presented in Other (income)/deductions––net on the consolidated statements of income. For additional information, see Note 1B and Note 4.
(d) 
In 2017 and 2016, the changes to Other comprehensive (income)/loss for the international plans was impacted by foreign currency movements. For details of the changes in Other comprehensive (income)/loss, see the benefit plan activity in the consolidated statements of comprehensive income.
The following table provides the amounts in Accumulated other comprehensive loss expected to be amortized into 2019 net periodic benefit costs:
  
 
Pension Plans
 
  
(MILLIONS OF DOLLARS)
 
U.S.
Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International 
 
Postretirement Plans
Actuarial losses(a)
 
$
(148
)
 
$
(9
)
 
$
(81
)
 
$
(4
)
Prior service credits and other
 
3

 
1

 
3

 
178

Total
 
$
(145
)
 
$
(9
)
 
$
(78
)
 
$
175


(a) 
Due to the U.S. Pfizer Consolidated Pension Plan freeze effective for January 1, 2018, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans reflect the expected life expectancy of the plan participants, whereas prior years utilized the expected future service period of plan participants. The average amortization periods to be utilized for 2019 are 24.2 years for our U.S. qualified plans, 25.3 years for our U.S. supplemental (non-qualified) plans, 20 years for our international plans, and 9.3 years for our postretirement plans.
B. Actuarial Assumptions
The following table provides the weighted-average actuarial assumptions of our benefit plans:
(PERCENTAGES)
 
2018
 
2017
 
2016
Weighted-average assumptions used to determine benefit obligations
 
 
 
 
 
 
Discount rate:
 
 
 
 
 
 
U.S. qualified pension plans
 
4.4%
 
3.8%
 
4.3%
U.S. non-qualified pension plans
 
4.3%
 
3.7%
 
4.2%
International pension plans
 
2.5%
 
2.3%
 
2.4%
Postretirement plans
 
4.3%
 
3.7%
 
4.2%
Rate of compensation increase:
 
 
 
 
 
 
U.S. qualified pension plans(a)
 
—
 
2.8%
 
2.8%
U.S. non-qualified pension plans(a)
 
—
 
2.8%
 
2.8%
International pension plans
 
1.4%
 
2.5%
 
2.6%
Weighted-average assumptions used to determine net periodic benefit cost
 
 
 
 
 
 
Discount rate:
 
 
 
 
 
 
U.S. qualified pension plans
 
3.8%
 
4.3%
 
4.5%
U.S. non-qualified pension plans
 
3.7%
 
4.2%
 
4.5%
International pension plans interest cost(b)
 
2.0%
 
2.1%
 
2.7%
International pension plans service cost(b)
 
2.3%
 
2.3%
 
3.0%
Postretirement plans
 
3.7%
 
4.2%
 
4.5%
Expected return on plan assets:
 
 
 
 
 
 
U.S. qualified pension plans
 
7.5%
 
8.0%
 
8.0%
International pension plans
 
4.4%
 
4.7%
 
5.2%
Postretirement plans
 
7.5%
 
8.0%
 
8.0%
Rate of compensation increase:
 
 
 
 
 
 
U.S. qualified pension plans
 
2.8%
 
2.8%
 
2.8%
U.S. non-qualified pension plans
 
2.8%
 
2.8%
 
2.8%
International pension plans
 
2.5%
 
2.6%
 
2.6%

(a) 
Effective January 1, 2018, we froze the defined benefit plans to future benefit accruals in the U.S. and members’ accrued benefits to that date no longer increase in line with future compensation increases. The rate of compensation increase is therefore no longer an assumption used to determine the benefit obligation.
(b) 
Effective January 1, 2016, the Company changed the approach used to measure service cost and interest costs for certain international pension plans and other postretirement benefits. In accordance with this change, the effective rate for interest on the benefit obligations and effective rate for service cost, respectively, are reported for international pension plans.
The assumptions above are used to develop the benefit obligations at fiscal year-end and to develop the net periodic benefit cost for the subsequent fiscal year. Therefore, the assumptions used to determine net periodic benefit cost for each year are established at the end of each previous fiscal year, while the assumptions used to determine benefit obligations are established at each fiscal year-end.

The net periodic benefit cost and the benefit obligations are based on actuarial assumptions that are reviewed on at least an annual basis. We revise these assumptions based on an annual evaluation of long-term trends, as well as market conditions that may have an impact on the cost of providing retirement benefits.

The weighted-average discount rate for our U.S. defined benefit plans is determined annually and evaluated and modified to reflect at year-end the prevailing market rate of a portfolio of high-quality fixed income investments, rated AA/Aa or better that reflect the rates at which the pension benefits could be effectively settled. For our international plans, the discount rates are set by benchmarking against investment grade corporate bonds rated AA/Aa or better, including, when there is sufficient data, a yield curve approach. These rate determinations are made consistent with local requirements. Overall, the yield curves used to measure the benefit obligations at year-end 2018 resulted in higher discount rates as compared to the prior year.
The following table provides the healthcare cost trend rate assumptions for our U.S. postretirement benefit plans:
 
 
2018

 
2017

Healthcare cost trend rate assumed for next year (up to age 65)
 
5.8
%
 
6.1
%
Healthcare cost trend rate assumed for next year (age 65 and older)
 
6.5
%
 
7.0
%
Rate to which the cost trend rate is assumed to decline
 
4.5
%
 
4.5
%
Year that the rate reaches the ultimate trend rate
 
2037

 
2037


The following table provides the effects as of December 31, 2018 of a one-percentage-point increase or decrease in the healthcare cost trend rate assumed for postretirement benefits:
(MILLIONS OF DOLLARS)
 
Increase

 
Decrease

Effect on total service and interest cost components
 
$
3

 
$
(2
)
Effect on postretirement benefit obligation
 
35

 
(27
)

Actuarial and other assumptions for pension and postretirement plans can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For a description of the risks associated with estimates and assumptions, see Note 1C.

C. Obligations and Funded Status
The following table provides an analysis of the changes in our benefit obligations, plan assets and funded status of our benefit plans:
  
 
Year Ended December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S. Qualified(a)
 
U.S. Supplemental
(Non-Qualified)
 
International(b)
 
Postretirement
Plans(c)
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Change in benefit obligation(d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit obligation, beginning
 
$
16,702

 
$
15,547

 
$
1,495

 
$
1,450

 
$
10,607

 
$
9,691

 
$
2,028

 
$
2,254

Service cost
 
—

 
269

 
—

 
24

 
136

 
171

 
39

 
42

Interest cost
 
598

 
634

 
55

 
54

 
212

 
204

 
72

 
90

Employee contributions
 
—

 
—

 
—

 
—

 
7

 
6

 
102

 
94

Plan amendments
 
(22
)
 
—

 
—

 
—

 
29

 
2

 
2

 
—

Changes in actuarial assumptions and other
 
(1,219
)
 
1,614

 
(152
)
 
110

 
(169
)
 
135

 
(122
)
 
(177
)
Foreign exchange impact
 
—

 
—

 
—

 
—

 
(457
)
 
760

 
(4
)
 
5

Acquisitions/divestitures/other, net
 
—

 
—

 
—

 
—

 
(2
)
 
26

 
—

 
1

Curtailments
 
11

 
11

 
1

 
—

 
(3
)
 
—

 
(1
)
 
1

Settlements
 
(391
)
 
(842
)
 
(72
)
 
(98
)
 
(34
)
 
(31
)
 
—

 
—

Special termination benefits
 
6

 
—

 
10

 
—

 
—

 
1

 
2

 
—

Benefits paid
 
(546
)
 
(530
)
 
(58
)
 
(45
)
 
(373
)
 
(357
)
 
(249
)
 
(280
)
Benefit obligation, ending(d)
 
15,141

 
16,702

 
1,280

 
1,495

 
9,952

 
10,607

 
1,870

 
2,028

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Change in plan assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets, beginning
 
14,284

 
12,556

 
—

 
—

 
8,863

 
7,683

 
494

 
458

Actual gain/(loss) on plan assets
 
(796
)
 
2,005

 
—

 
—

 
(77
)
 
811

 
(22
)
 
39

Company contributions
 
500

 
1,095

 
129

 
143

 
209

 
160

 
145

 
183

Employee contributions
 
—

 
—

 
—

 
—

 
7

 
6

 
102

 
94

Foreign exchange impact
 
—

 
—

 
—

 
—

 
(380
)
 
561

 
—

 
—

Acquisitions/divestitures, net
 
—

 
—

 
—

 
—

 
—

 
30

 
—

 
—

Settlements
 
(391
)
 
(842
)
 
(72
)
 
(98
)
 
(34
)
 
(31
)
 
—

 
—

Benefits paid
 
(546
)
 
(530
)
 
(58
)
 
(45
)
 
(373
)
 
(357
)
 
(249
)
 
(280
)
Fair value of plan assets, ending
 
13,051

 
14,284

 
—

 
—

 
8,215

 
8,863

 
469

 
494

Funded status—Plan assets less than benefit obligation
 
$
(2,089
)
 
$
(2,418
)
 
$
(1,280
)
 
$
(1,495
)
 
$
(1,738
)
 
$
(1,745
)
 
$
(1,401
)
 
$
(1,534
)
(a)
The favorable change in the funded status of our U.S. qualified plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
(b) 
The favorable change in the international plans’ funded status was primarily due to favorable currency movements, partially offset by a decrease in the actual return on plan assets.
(c) 
The favorable change in the funded status of our postretirement plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
(d) 
For the U.S. and international pension plans, the benefit obligation is the PBO. For the postretirement plans, the benefit obligation is the ABO. The ABO for all of our U.S. qualified pension plans was $15.1 billion in 2018 and $16.7 billion in 2017. The ABO for our U.S. supplemental (non-qualified) pension plans was $1.3 billion in 2018 and $1.5 billion in 2017. The ABO for our international pension plans was $9.5 billion in 2018 and $10.1 billion in 2017.
The following table provides information as to how the funded status is recognized in our consolidated balance sheets:
  
 
As of December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S. Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International
 
Postretirement
Plans
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Noncurrent assets(a)
 
$
—

 
$
—

 
$
—

 
$
—

 
$
401

 
$
454

 
$
—

 
$
—

Current liabilities(b)
 
(1
)
 
—

 
(167
)
 
(160
)
 
(28
)
 
(26
)
 
(29
)
 
(31
)
Noncurrent liabilities(c)
 
(2,088
)
 
(2,418
)
 
(1,113
)
 
(1,336
)
 
(2,111
)
 
(2,172
)
 
(1,371
)
 
(1,504
)
Funded status
 
$
(2,089
)
 
$
(2,418
)
 
$
(1,280
)
 
$
(1,495
)
 
$
(1,738
)
 
$
(1,745
)
 
$
(1,401
)
 
$
(1,534
)
(a) 
Included primarily in Other noncurrent assets.
(b) 
Included in Accrued compensation and related items.
(c) 
Included in Pension benefit obligations, net and Postretirement benefit obligations, net, as appropriate.
The following table provides the pre-tax components of cumulative amounts recognized in Accumulated other comprehensive loss:
 
 
As of December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S. Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International
 
Postretirement
Plans
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Actuarial losses(a)
 
$
(5,061
)
 
$
(4,677
)
 
$
(370
)
 
$
(561
)
 
$
(2,372
)
 
$
(2,322
)
 
$
(202
)
 
$
(293
)
Prior service (costs)/credits
 
1

 
(23
)
 
1

 
1

 
—

 
34

 
994

 
1,190

Total
 
$
(5,060
)
 
$
(4,699
)
 
$
(370
)
 
$
(559
)
 
$
(2,372
)
 
$
(2,288
)
 
$
792

 
$
897

(a) 
The accumulated actuarial losses primarily represent the impact of changes in discount rates and other assumptions that result in cumulative changes in our PBO, as well as the cumulative difference between the expected return and actual return on plan assets. These accumulated actuarial losses are recognized in Accumulated other comprehensive loss and are amortized into net periodic benefit costs primarily over the average remaining service period for active participants for plans that are not frozen or the expected life expectancy of plan participants for frozen plans, using the corridor approach.
The following table provides information related to the funded status of selected benefit plans:
 
 
As of December 31,
 
 
Pension Plans
 
 
U.S. Qualified
 
U.S. Supplemental (Non-Qualified)
 
International
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Pension plans with an ABO in excess of plan assets:
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets
 
$
13,051

 
$
14,284

 
$
—

 
$
—

 
$
4,514

 
$
882

ABO
 
15,141

 
16,702

 
1,280

 
1,495

 
6,286

 
2,724

Pension plans with a PBO in excess of plan assets:
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets
 
13,051

 
14,284

 
—

 
—

 
5,432

 
1,626

PBO
 
15,141

 
16,702

 
1,280

 
1,495

 
7,571

 
3,825


All of our U.S. plans and many of our international plans were underfunded as of December 31, 2018.

D. Plan Assets
The following table provides the components of plan assets:
  
 
  
 
Fair Value(a)
 
 
 
  
 
Fair Value(a)
 
 
(MILLIONS OF DOLLARS)
 
As of
December 31,
2018

 
Level 1
 
Level 2
 
Level 3
 
Assets Measured at NAV(b)

 
As of
December 31,
2017

 
Level 1
 
Level 2
 
Level 3
 
Assets Measured at NAV(b)

U.S. qualified pension plans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
443

 
$
53

 
$
390

 
$
—

 
$
—

 
$
655

 
$
115

 
$
540

 
$
—

 
$
—

Equity securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Global equity securities
 
3,156

 
3,119

 
37

 
—

 
—

 
4,157

 
4,118

 
38

 
1

 
—

Equity commingled funds
 
933

 
—

 
634

 
—

 
299

 
1,194

 
—

 
802

 
—

 
392

Fixed income securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Corporate debt securities
 
4,654

 
1

 
4,650

 
3

 
—

 
4,250

 
5

 
4,242

 
3

 
—

Government and agency obligations
 
1,391

 
—

 
1,391

 
—

 
—

 
1,316

 
—

 
1,316

 
—

 
—

Fixed income commingled funds
 
96

 
—

 
—

 
—

 
96

 
94

 
—

 
—

 
—

 
94

Other investments:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Partnership investments(c)
 
1,165

 
—

 
—

 
—

 
1,165

 
1,197

 
—

 
—

 
—

 
1,197

Insurance contracts
 
192

 
—

 
192

 
—

 
—

 
215

 
—

 
215

 
—

 
—

Other commingled funds(d)
 
1,021

 
—

 
—

 
—

 
1,021

 
1,206

 
—

 
—

 
—

 
1,206

Total
 
$
13,051

 
$
3,173

 
$
7,294

 
$
3

 
$
2,581

 
$
14,284

 
$
4,238

 
$
7,153

 
$
4

 
$
2,889

International pension plans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
246

 
$
39

 
$
208

 
$
—

 
$
—

 
$
385

 
$
48

 
$
337

 
$
—

 
$
—

Equity securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Global equity securities
 
2

 
2

 
—

 
—

 
—

 
154

 
146

 
8

 
—

 
—

Equity commingled funds
 
1,876

 
—

 
1,413

 
—

 
463

 
2,897

 
—

 
1,594

 
—

 
1,303

Fixed income securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Corporate debt securities
 
727

 
—

 
727

 
—

 
—

 
588

 
—

 
588

 
—

 
—

Government and agency obligations(e)
 
1,305

 
—

 
1,305

 
—

 
—

 
716

 
—

 
716

 
—

 
—

Fixed income commingled funds
 
1,770

 
—

 
1,007

 
—

 
762

 
2,181

 
—

 
1,340

 
—

 
841

Other investments:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Partnership investments(c)
 
57

 
—

 
4

 
—

 
53

 
42

 
—

 
7

 
—

 
35

Insurance contracts(f)
 
759

 
—

 
74

 
684

 
1

 
496

 
—

 
75

 
420

 
1

Other(d), (f)
 
1,473

 
—

 
71

 
382

 
1,020

 
1,404

 
—

 
408

 
468

 
528

Total
 
$
8,215

 
$
40

 
$
4,809

 
$
1,065

 
$
2,300

 
$
8,863

 
$
194

 
$
5,073

 
$
887

 
$
2,709

U.S. postretirement plans(g)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Equity securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Global equity securities
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Equity commingled funds
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Fixed income securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Corporate debt securities
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Government and agency obligations
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Fixed income commingled funds
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Other investments:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Partnership investments(c)
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Insurance contracts
 
469

 
—

 
469

 
—

 
—

 
494

 
—

 
494

 
—

 
—

Other commingled funds(d)
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total
 
$
469

 
$
—

 
$
469

 
$
—

 
$
—

 
$
494

 
$
—

 
$
494

 
$
—

 
$
—

(a)
Fair values are determined based on valuation inputs categorized as Level 1, 2 or 3 (see Note 1E).
(b)
Certain investments that are measured at NAV per share (or its equivalent) have not been classified in the fair value hierarchy. The NAV amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented for the total pension benefits plan assets.
(c) 
Primarily includes investments in private equity, private debt, public equity limited partnerships, and, to a lesser extent, real estate and venture capital.
(d) 
Primarily includes, for U.S. plan assets, investments in hedge funds and, to a lesser extent, real estate and, for international plan assets, investments in real estate and hedge funds.
(e) 
Government and agency obligations are inclusive of repurchase agreements.
(f) 
See below for a tabular analysis of the changes in Level 3 investments valued using significant unobservable inputs.
(g) 
Reflects postretirement plan assets, which support a portion of our U.S. retiree medical plans.
The following table provides an analysis of the changes in our more significant investments valued using significant unobservable inputs:
 
 
Year Ended December 31,
 
 
International Pension Plans
 
 
Insurance contracts
 
Other
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

Fair value, beginning
 
$
420

 
$
254

 
$
468

 
$
324

Actual return on plan assets:
 
 
 

 


 

Assets held, ending
 
1

 
1

 
15

 
18

Assets sold during the period
 
—

 
—

 
—

 
1

Purchases, sales, and settlements, net
 
188

 
138

 
(31
)
 
94

Transfer into/(out of) Level 3
 
107

 
—

 
(51
)
 
—

Exchange rate changes
 
(31
)
 
27

 
(20
)
 
30

Fair value, ending
 
$
684

 
$
420

 
$
382

 
$
468



A single estimate of fair value can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For a description of our general accounting policies associated with developing fair value estimates, see Note 1E. For a description of the risks associated with estimates and assumptions, see Note 1C.
Equity securities, Fixed income securities and Other investments may each be combined into commingled funds. Most commingled funds are valued to reflect the interest in the fund based on the reported year-end NAV. Partnership and Other investments are valued based on year-end reported NAV (or its equivalent), with adjustments as appropriate for lagged reporting of up to three months.

The following methods and assumptions were used to estimate the fair value of our pension and postretirement plans’ assets:
•
Cash and cash equivalents: Level 1 investments may include cash, cash equivalents and foreign currency valued using exchange rates. Level 2 investments may include short-term investment funds which are commingled funds priced at a stable NAV by the administrator of the funds.
•
Equity securities: Level 1 investments may include individual securities that are valued at the closing price or last trade reported on the major market on which they are traded. Level 1 and Level 2 investments may include commingled funds that have a readily determinable fair value based on quoted prices on an exchange or a published NAV derived from the quoted prices in active markets of the underlying securities. Level 3 investments may include individual securities that are unlisted, delisted, suspended, or illiquid and are typically valued using their last available price.
•
Fixed income securities: Level 1 investments may include individual securities that are valued at the closing price or last trade reported on the major market on which they are traded. Level 2 investments may include commingled funds that have a readily determinable fair value based on observable prices of the underlying securities. Level 2 investments may include corporate bonds, government and government agency obligations and other fixed income securities valued using bid evaluation pricing models or quoted prices of securities with similar characteristics. Level 3 investments may include securities that are valued using alternative pricing sources, such as investment managers or brokers, which use proprietary pricing models that incorporate unobservable inputs.
•
Other investments: Level 1 investments may include individual securities that are valued at the closing price or last trade reported on the major market on which they are traded. Level 2 investments may include Insurance contracts which invest in interest bearing cash, U.S. government securities and corporate debt instruments.
Certain investments are authorized to include derivatives, such as equity or bond futures, swaps, options and currency futures or forwards for managing risks and exposures.
The following table provides the long-term target asset allocations ranges and the percentage of the fair value of plan assets for benefit plans:
  
 
As of December 31,
  
 
Target
Allocation Percentage

 
Percentage of Plan Assets
(PERCENTAGES)
 
2018

 
2018

 
2017

U.S. qualified pension plans
 
 
 
 
 
 
Cash and cash equivalents
 
0-10%

 
3.4
%
 
4.6
%
Equity securities
 
35-55%

 
31.3
%
 
37.5
%
Fixed income securities
 
28-53%

 
47.1
%
 
39.6
%
Other investments(a)
 
5-20%

 
18.2
%
 
18.3
%
Total
 
100
%
 
100
%
 
100
%
International pension plans
 
 
 
 
 
 
Cash and cash equivalents
 
0-10%

 
3.0
%
 
4.3
%
Equity securities
 
20-40%

 
22.9
%
 
34.4
%
Fixed income securities
 
35-60%

 
46.3
%
 
39.3
%
Other investments
 
10-35%

 
27.9
%
 
21.9
%
Total
 
100
%
 
100
%
 
100
%
U.S. postretirement plans
 
 
 
 
 
 
Cash and cash equivalents
 
0-5%

 
—

 
—

Equity securities
 
—

 
—

 
—

Fixed income securities
 
—

 
—

 
—

Other investments
 
95-100%

 
100
%
 
100
%
Total
 
100
%
 
100
%
 
100
%
(a) 
Actual percentage of plan assets in Other investments for 2018 includes $192 million, as compared to $215 million in 2017, related to a group fixed annuity insurance contract that was executed by legacy Wyeth for certain members of its defined benefit plans prior to Pfizer acquiring the company in 2009, and $177 million in 2018, as compared to $253 million in 2017, related to an investment in a partnership whose primary holdings are public equity securities. 
Global plan assets are managed with the objective of generating returns that will enable the plans to meet their future obligations, while seeking to manage net periodic benefit costs and cash contributions over the long-term. We utilize long-term asset allocation ranges in the management of our plans’ invested assets. Our long-term return expectations are developed based on a diversified, global investment strategy that takes into account historical experience, as well as the impact of portfolio diversification, active portfolio management, and our view of current and future economic and financial market conditions. As market conditions and other factors change, we may adjust our targets accordingly and our asset allocations may vary from the target allocations.

Our long-term asset allocation ranges reflect our asset class return expectations and tolerance for investment risk within the context of the respective plans’ long-term benefit obligations. These ranges are supported by analysis that incorporates historical and expected returns by asset class, as well as volatilities and correlations across asset classes and our liability profile.

Each pension plan is overseen by a local committee or board that is responsible for the overall investment of the pension plan assets. In determining investment policies and associated target allocations, each committee or board considers a wide variety of factors. As such, the target asset allocation for each of our international pension plans is set on a standalone basis by the relevant board or committee. The target asset allocation ranges shown for the international pension plans seek to reflect the combined target allocations across all such plans, while also showing the range within which the target allocations for each plan typically falls.

The investment managers of certain separately managed accounts, commingled funds and private equity funds may be permitted to use repurchase agreements and derivative securities, including U.S. Treasury and equity futures contracts as described in each respective investment management, subscription, partnership or other governing agreement.

E. Cash Flows

It is our practice to fund amounts for our qualified pension plans that are at least sufficient to meet the minimum requirements set forth in applicable employee benefit laws and local tax laws.
The following table provides the expected future cash flow information related to our benefit plans:
  
 
Pension Plans
 
 
(MILLIONS OF DOLLARS)
 
U.S. Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International
 
Postretirement Plans
Expected employer contributions:
 
 
 
 
 
 
 
 
2019
 
$
11

 
$
167

 
$
177

 
$
160

Expected benefit payments:
 
 
 
 
 
 
 
 
2019
 
$
1,387

 
$
167

 
$
354

 
$
166

2020
 
1,089

 
121

 
372

 
171

2021
 
1,058

 
114

 
380

 
171

2022
 
1,020

 
113

 
385

 
168

2023
 
1,018

 
103

 
387

 
165

2024–2028
 
4,837

 
445

 
2,068

 
777


The above table reflects the total U.S. and international plan benefits projected to be paid from the plans or from our general assets under the current actuarial assumptions used for the calculation of the benefit obligation and, therefore, actual benefit payments may differ from projected benefit payments.
F. Defined Contribution Plans

We have defined contribution plans in the U.S. and several other countries. For the majority of the U.S. defined contribution plans, employees may contribute a portion of their salaries and bonuses to the plans, and we match, in cash, a portion of the employee contributions. Beginning on January 1, 2011, for newly hired non-union employees, rehires and transfers to the U.S. or Puerto Rico, we no longer offer a defined benefit pension plan and, instead, offer a Retirement Savings Contribution (RSC) in the defined contribution plan. The RSC is an annual non-contributory employer contribution (that is not dependent upon the participant making a contribution) determined based on each employee’s eligible compensation, age and years of service. Beginning on January 1, 2018, all non-union employees in the U.S. and Puerto Rico defined benefit plans transitioned to the RSC in the defined contribution plans. We recorded charges related to the employer contributions to global defined contribution plans of $622 million in 2018, $380 million in 2017 and $317 million in 2016.
v3.10.0.1
Equity
 12 Months Ended
Dec. 31, 2018
Equity [Abstract]  
Equity
Equity

A. Common Stock

We purchase our common stock through privately negotiated transactions or in open market purchases as circumstances and prices warrant. Purchased shares under each of the share-purchase plans, which are authorized by our Board of Directors, are available for general corporate purposes. On October 23, 2014, we announced that the Board of Directors had authorized an $11 billion share repurchase program, which was exhausted in the first quarter of 2017. In December 2015, the Board of Directors authorized a new $11 billion share repurchase program (the December 2015 Stock Purchase Plan), which was exhausted in the third quarter of 2018. In December 2017, the Board of Directors authorized an additional $10 billion share repurchase program, to be utilized over time, and share repurchases commenced thereunder in the third quarter of 2018 (the 2017 program). In December 2018, the Board of Directors authorized a new $10.0 billion share repurchase program to be utilized over time. This new program is in addition to the $4.2 billion remaining under the company’s 2017 program authorization as of December, 31 2018.
On March 8, 2016, we entered into an accelerated share repurchase agreement with GS&Co. to repurchase $5 billion of our common stock. Pursuant to the terms of the agreement, on March 10, 2016, we paid $5 billion to GS&Co. and received an initial delivery of approximately 136 million shares of our common stock from GS&Co. based on a price of $29.36 per share, which represented, based on the closing share price of our common stock on the NYSE on March 8, 2016, approximately 80% of the notional amount of the accelerated share repurchase agreement. On June 20, 2016, the accelerated share repurchase agreement with GS&Co. was completed, which, per the terms of the agreement, resulted in GS&Co. owing us a certain number of shares of Pfizer common stock. Pursuant to the agreement’s settlement terms, we received an additional 18 million shares of our common stock from GS&Co. on June 20, 2016. The average price paid for all of the shares delivered under the accelerated share repurchase agreement was $32.38 per share. The common stock received is included in Treasury stock. This agreement was entered into pursuant to our previously announced share repurchase authorization.
On February 2, 2017, we entered into an accelerated share repurchase agreement with Citibank to repurchase $5 billion of our common stock. Pursuant to the terms of the agreement, on February 6, 2017, we paid $5 billion to Citibank and received an initial delivery of approximately 126 million shares of our common stock from Citibank at a price of $31.73 per share, which represented, based on the closing price of our common stock on the NYSE on February 2, 2017, approximately 80% of the notional amount of the accelerated share repurchase agreement. On May 16, 2017, the accelerated share repurchase agreement with Citibank was completed, which, per the terms of the agreement, resulted in Citibank owing us a certain number of shares of Pfizer common stock. Pursuant to the agreement’s settlement terms, we received an additional 24 million shares of our common stock from Citibank on May 19, 2017. The average price paid for all of the shares delivered under the accelerated share repurchase agreement was $33.31 per share. The common stock received is included in Treasury Stock. This agreement was entered into pursuant to our previously announced share repurchase authorization.
On March 12, 2018, we entered into an accelerated share repurchase agreement with Citibank to repurchase $4.0 billion of our common stock. Pursuant to the terms of the agreement, on March 14, 2018, we paid $4.0 billion to Citibank and received an initial delivery of approximately 87 million shares of our common stock from Citibank at a price of $36.61 per share, which represented, based on the closing price of our common stock on the NYSE on March 12, 2018, approximately 80% of the notional amount of the accelerated share repurchase agreement. On September 5, 2018, the accelerated share repurchase agreement with Citibank was completed, which, per the terms of the agreement, resulted in Citibank owing us a certain number of shares of Pfizer common stock. Pursuant to the agreement’s settlement terms, we received an additional 21 million shares of our common stock from Citibank on September 7, 2018. The average price paid for all of the shares delivered under the accelerated share repurchase agreement was $36.86 per share. The common stock received is included in Treasury stock. This agreement was entered into pursuant to our previously announced share repurchase authorization.
Open market purchases totaled $8.2 billion in 2018 under our publicly announced share-purchase plans.
The following table provides the number of shares of our common stock purchased and the cost of purchases under our publicly announced share-purchase plans, including our accelerated share repurchase agreements:
(SHARES IN MILLIONS, DOLLARS IN BILLIONS)
 
2018(a)

 
2017(b)

 
2016(c)

Shares of common stock purchased
 
307

 
150

 
154

Cost of purchase
 
$
12.2

 
$
5.0

 
$
5.0

(a) 
Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on March 12, 2018, as well as other share repurchases. See above for additional information.
(b) 
Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on February 2, 2017. See above for additional information.
(c) 
Represents shares purchased pursuant to the accelerated share repurchase agreement entered into on March 8, 2016. See above for additional information.
After giving effect to the accelerated share repurchase agreement, as well as other share repurchases through December 31, 2018, our remaining share-purchase authorization was approximately $14.2 billion at December 31, 2018.
On February 7, 2019, we entered into an accelerated share repurchase agreement with GS&Co. to repurchase approximately $6.8 billion of our common stock. This agreement was entered into pursuant to our previously announced share repurchase authorization. For additional information, see Note 19.
B. Preferred Stock

The Series A convertible perpetual preferred stock is held by an employee stock ownership plan (Preferred ESOP) Trust and provides dividends at the rate of 6.25%, which are accumulated and paid quarterly. The per-share stated value is $40,300 and the preferred stock ranks senior to our common stock as to dividends and liquidation rights. Each share is convertible, at the holder’s option, into 2,574.87 shares of our common stock with equal voting rights. The conversion option is indexed to our common stock and requires share settlement, and, therefore, is reported at the fair value at the date of issuance. We may redeem the preferred stock at any time or upon termination of the Preferred ESOP, at our option, in cash, in shares of common stock, or a combination of both at a price of $40,300 per share.
C. Employee Stock Ownership Plans

We have two employee stock ownership plans (collectively, the ESOPs), the Preferred ESOP and another that holds common stock of the Company (Common ESOP).

Allocated shares held by the Common ESOP, including reinvested dividends, are considered outstanding for EPS calculations and the eventual conversion of allocated preferred shares held by the Preferred ESOP are assumed in the diluted EPS calculation. As of December 31, 2018, the Preferred ESOP held preferred shares convertible into approximately 1 million shares of our common stock, and the Common ESOP held approximately 49 million shares of our common stock. As of December 31, 2018, all shares of preferred and common stock held by the ESOPs have been allocated to the Pfizer U.S. defined contribution plan participants. The compensation cost related to the Common ESOP was $19 million in 2018, $11 million in 2017 and $9 million in 2016.
v3.10.0.1
Share-Based Payments
 12 Months Ended
Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Share-Based Payments
Share-Based Payments

Our compensation programs can include share-based payments. The award value is determined by reference to the fair value of share-based awards to similar employees in competitive survey data or industry peer groups used for compensation purposes; and is allocated between different long-term incentive vehicles, in the form of RSUs, PPSs, TSRUs, stock options, PSAs, PTSRUs and PTUs, as determined by the Compensation Committee.

The 2014 Stock Plan (2014 Plan) replaced and superseded the 2004 Plan, as amended and restated. The 2014 Plan provides for 520 million shares to be authorized for grants, plus any shares remaining available for grant under the 2004 Plan as of April 24, 2014 (the carryforward shares). In addition, the 2014 Plan provides that the number of stock options, Stock Appreciation Rights (known as TSRUs and PTSRUs), RSUs, or other performance-based awards that may be granted to any one individual during any 36-month period is limited to 20 million shares, and that RSUs, PPSs and PSAs count as three shares, while TSRUs, PTSRUs and stock options count as one share, toward the maximum shares available under the 2014 plan. The 2004 Plan provided that the number of stock options, TSRUs or other performance-based awards granted to any one individual during any 36-month period was limited to 8 million shares. As of December 31, 2018, 195 million shares were available for award.
Although not required to do so, we have used authorized and unissued shares and, to a lesser extent, treasury stock to satisfy our obligations under these programs.
A. Impact on Net Income
The following table provides the components of share-based compensation expense and the associated tax benefit:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

TSRUs(a)
 
$
302

 
$
221

 
$
134

RSUs
 
286

 
301

 
299

PPSs
 
276

 
209

 
135

PSAs
 
62

 
47

 
13

Stock options
 
12

 
55

 
106

Directors’ compensation
 
10

 
7

 
4

Share-based payment expense
 
949

 
840

 
691

Tax benefit for share-based compensation expense(b)
 
(180
)
 
(163
)
 
(205
)
Share-based payment expense, net of tax
 
$
769

 
$
677

 
$
486


(a) 
Includes $7.0 million of expense for PTSRUs.
(b) 
2018 and 2017 include the impact of the TCJA on income taxes.
Amounts capitalized as part of inventory cost were not significant for any period presented.
B. Total Shareholder Return Units

TSRUs are awarded to senior and other key management, and, beginning in 2016, to certain other employees. TSRUs entitle the holders to receive a number of shares of our common stock with a value equal to the difference between the defined settlement price and the grant price, plus the dividends accumulated during the five-year or seven-year term, if and to the extent the total value is positive. The settlement price is the average closing price of our common stock during the 20 trading days ending on the fifth or seventh anniversary of the grant, as applicable; the grant price is the closing price of our common stock on the date of the grant. The TSRUs are automatically settled on the fifth or seventh anniversary of the grant but vest on the third anniversary of the grant, after which time there is no longer a substantial risk of forfeiture.

On October 26, 2016, the Compensation Committee approved the modification of current outstanding grants of TSRU awards, effective November 1, 2016, to permit a holder who is "retiree eligible" (at least age 55 with at least 10 years of service), to elect to exercise and convert his/her TSRUs when vested, into PTUs. The value received upon the election and conversion is calculated by taking the change in stock price (20 trading day average ending on the exercise date (Election Price) less the grant price) plus accumulated dividends from the grant date, times the number of TSRUs exercised. This value is divided by the Election Price to determine the number of PTUs. The PTUs will be entitled to earn Dividend Equivalent Units (DEUs), and the PTUs and DEUs will be settled in our common stock on the TSRUs original settlement date (i.e., the fifth or seventh anniversary of grant), and will be subject to all of the terms and conditions of the original grant including forfeiture provisions. This modification applied to approximately 2,900 employees, including members of senior management. There was no incremental compensation cost resulting from the modification. Beginning in 2017, TSRUs were granted with the right for retirement-eligible employees to elect to exercise and convert their TSRUs, when vested, into PTUs. We measure the value of TSRU grants as of the grant date using a Monte Carlo simulation model. The values determined through this fair value methodology generally are amortized on a straight-line basis over the vesting term into Cost of sales, Selling, informational and administrative expenses, and/or Research and development expenses, as appropriate.
The following table provides the weighted-average assumptions used in the valuation of TSRUs:  
 
 
Year Ended December 31,
2018

 
2017

 
2016

Expected dividend yield(a)
 
3.73
%
 
3.69
%
 
3.85
%
Risk-free interest rate(b)
 
2.60
%
 
1.98
%
 
1.31
%
Expected stock price volatility(c)
 
20.00
%
 
18.39
%
 
21.64
%
Contractual term (years)
 
5.12

 
5.11

 
5.12

(a) 
Determined using a constant dividend yield during the expected term of the TSRU.
(b) 
Determined using the interpolated yield on U.S. Treasury zero-coupon issues.
(c) 
Determined using implied volatility, after consideration of historical volatility.
The following table summarizes all TSRU activity during 2018:
 
 
TSRUs
(Thousands)

 
Weighted-Average
Grant-Date
Fair Value
Per TSRU

 
Weighted-Average
Grant Price
Per TSRU

Nonvested, December 31, 2017
 
103,906

 
$
6.07

 
$
32.47

Granted
 
47,755

 
7.42

 
35.75

Vested(a)
 
(7,203
)
 
6.67

 
34.49

Forfeited
 
(5,512
)
 
6.55

 
33.88

Nonvested, December 31, 2018
 
138,945

 
$
6.48

 
$
33.44

(a) 
Includes the modification of approximately 1.7 million TSRUs to approximately 260 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
The following table summarizes TSRU and PTU information as of December 31, 2018(a), (b):
 
 
TSRUs
(Thousands)

 
PTUs
(Thousands)

 
Weighted-Average
Grant Price
Per TSRU

 
Weighted-Average
Remaining Contractual Term (Years)
 
Aggregate Intrinsic Value (Millions)

TSRUs Outstanding
 
156,534

 
—

 
$
33.09

 
3.1
 
$
2,073

TSRUs Vested(c)
 
17,588

 
—

 
30.30

 
1.5
 
332

TSRUs Expected to vest(d)
 
133,878

 
—

 
33.38

 
3.2
 
1,688

TSRUs exercised and converted to PTUs
 
—

 
1,385

 
$
—

 
0.5
 
$
60

(a) 
In 2018, we settled 7,643,846 TSRUs with a weighted-average grant price of $23.13 per unit.
(b) 
In 2018, 2,809,652 TSRUs with a weighted-average grant price of $27.86 per unit were converted into 1,408,622 PTUs.
(c) 
Includes the modification of approximately 1.7 million TSRUs to approximately 260 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
(d) 
The number of TSRUs expected to vest takes into account an estimate of expected forfeitures.
The following table provides data related to all TSRU activity:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS, EXCEPT PER TSRU AMOUNTS)
 
2018

 
2017

 
2016

Weighted-average grant-date fair value per TSRU
 
$
7.42

 
$
6.23

 
$
5.83

Total compensation cost related to nonvested TSRU grants not yet recognized, pre-tax
 
$
246

 
$
232

 
$
164

Weighted-average period over which TSRU cost is expected to be recognized (years)
 
1.6

 
1.7

 
1.9


C. Performance Total Shareholder Return Units

In December 2017, PTSRUs were awarded to the then Chairman and Chief Executive Officer and the then Group President, Pfizer Essential Health. These awards were granted in connection with our Board’s succession planning for the Chairman and Chief Executive Officer and our announcement on November 13, 2017 that our then Group President, Pfizer Innovative Health had been appointed Chief Operating Officer of Pfizer effective January 1, 2018. We also announced that effective January 1, 2018, the then Group President, Pfizer Essential Health, had been appointed Group President, Pfizer Innovative Health. In addition to having the same characteristics of TSRUs, PTSRUs require special service and performance conditions. On December 29, 2017, 1,372,213 PTSRUs were granted to the Chairman and Chief Executive Officer and 343,053 PTSRUs were granted to the new head of Innovative Health at a grant price of $36.22 and a grant-date fair value of $5.83.
We measure the value of PTSRU grants as of the grant date using a Monte Carlo simulation model. The values determined through this fair value methodology generally are amortized on a straight-line basis over the vesting term into Selling, informational and administrative expenses as appropriate.
D. Restricted Stock Units

RSUs are awarded to select employees and, when vested, entitle the holder to receive a specified number of shares of our common stock, including shares resulting from dividend equivalents paid on such RSUs. For RSUs granted during the periods presented, in virtually all instances, the units vest after three years of continuous service from the grant date.

We measure the value of RSU grants as of the grant date using the closing price of our common stock. The values determined through this fair value methodology generally are amortized on a straight-line basis over the vesting term into Cost of sales, Selling, informational and administrative expenses, and/or Research and development expenses, as appropriate.
The following table summarizes all RSU activity during 2018:
 
 
Shares 
(Thousands)

 
Weighted-Average
Grant-Date Fair Value
Per Share

Nonvested, December 31, 2017
 
22,241

 
$
32.64

Granted
 
9,083

 
35.90

Vested(a)
 
(3,701
)
 
34.02

Reinvested dividend equivalents
 
974

 
38.96

Forfeited
 
(1,321
)
 
33.85

Nonvested, December 31, 2018
 
27,276

 
$
33.70

(a) 
Includes the modification of approximately 150 thousand RSUs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit vesting upon termination. The impact to the compensation expense was immaterial.
The following table provides data related to all RSU activity:
(MILLIONS OF DOLLARS)
 
Year Ended December 31,
2018

 
2017

 
2016

Total fair value of shares vested(a)
 
$
146

 
$
584

 
$
293

Total compensation cost related to nonvested RSU awards not yet recognized, pre-tax
 
$
256

 
$
254

 
$
262

Weighted-average period over which RSU cost is expected to be recognized (years)
 
1.7

 
1.7

 
1.7

(a) 
2018 includes modification of approximately 150 thousand RSUs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit vesting upon termination. The impact to the compensation expense was immaterial. 2017 includes the modification for a commitment to pay approximately 6.4 million RSUs to approximately 9,900 employees, including senior and key management employees, for 6.6 million RSUs. These shares were paid in the first quarter of 2018.
E. Portfolio Performance Shares

PPSs are awards granted to select employees which, when vested, entitle the holder to receive, at the end of the performance period, a number of shares within a possible range of shares of our common stock, including shares resulting from dividend equivalents paid on such shares. For PPSs granted during the period presented, the awards vest after three years of continuous service from the grant date and the number of shares paid, if any, depends on the achievement of predetermined goals related to Pfizer’s long-term product portfolio during a five-year performance period from the year of the grant date. The number of shares that may be earned over the performance period ranges from 0% to 200% of the initial award.
We measure the value of PPS grants as of the grant date using the intrinsic value method, for which we use the closing price of our common stock. The values are amortized on a straight-line basis over the probable vesting term into Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses, as appropriate, and adjusted each reporting period, as necessary, to reflect changes in the price of Pfizer’s common stock, changes in the number of shares that are probable of being earned and changes in management’s assessment of the probability that the specified performance criteria will be achieved and/or changes in management’s
assessment of the probable vesting term.
The following table summarizes all PPS activity during 2018, with the shares representing the maximum award that could be achieved:
 
 
Shares 
(Thousands)

 
Weighted-Average
Intrinsic Value
Per Share

Nonvested, December 31, 2017
 
20,973

 
$
36.22

Granted
 
6,769

 
35.74

Vested(a)
 
(7,483
)
 
37.31

Forfeited
 
(998
)
 
38.23

Nonvested, December 31, 2018(b)
 
19,261

 
$
43.65

(a)
Includes the modification of approximately 200 thousand PPSs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
(b) 
Vested and non-vested shares outstanding, but not paid as of December 31, 2018 were 33.9 million.
The following table provides data related to all PPS activity:
(MILLIONS OF DOLLARS)
 
Year Ended December 31,
2018

 
2017

 
2016

Total fair value of shares vested(a)
 
$
169

 
$
131

 
$
118

Total compensation cost related to nonvested PPS awards not yet recognized, pre-tax
 
$
102

 
$
94

 
$
93

Weighted-average period over which PPS cost is expected to be recognized (years)
 
1.8

 
1.7

 
1.8


(a) 
Includes the modification of approximately 200 thousand PPSs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.

F. Performance Share Awards

PSAs are awarded to senior and other key management. PSAs vest after three years of continuous service from the grant date. The number of shares paid, if any, including shares resulting from dividend equivalents, for awards granted in 2015 and later, depends upon the achievement of predetermined goals related to two measures: (i) operating income (for performance years through 2018) or net income (for 2019 and later years) over three one-year periods; and (ii) TSR as compared to the NYSE ARCA Pharmaceutical Index (DRG Index) over the three-year performance period. The number of shares paid from awards granted in 2014 depends upon the achievement of predetermined goals related to Pfizer's TSR as compared to an industry peer group, for the three-year performance period from the year of the grant date. The number of shares that are earned over the performance period ranges from 0% to 200% of the initial award.

We measure the value of PSA grants as of the grant date using the intrinsic value method, for which we use the closing price of our common stock. The values are amortized on a straight-line basis over the probable vesting term into Cost of sales, Selling, informational and administrative expenses, and/or Research and development expenses, as appropriate, and adjusted each reporting period, as necessary, to reflect changes in the price of Pfizer’s common stock, changes in the number of shares that are probable of being earned and changes in management’s assessment of the probability that the specified performance criteria will be achieved.
The following table summarizes all PSA activity during 2018, with the shares granted representing the maximum award that could be achieved:
 
 
Shares 
(Thousands)

 
Weighted-Average
Intrinsic Value
Per Share

Nonvested, December 31, 2017
 
4,024

 
$
36.22

Granted
 
1,833

 
35.74

Vested(a)
 
(112
)
 
39.58

Forfeited
 
(463
)
 
37.12

Nonvested, December 31, 2018
 
5,282

 
$
43.65

(a) 
Includes the modification of a few PSAs to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
The following table provides data related to all PSA activity:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018
 
2017
 
2016
Total fair value of shares vested(a)
 
$
4

 
$
58

 
$
9

Total compensation cost related to nonvested PSA grants not yet recognized, pre-tax
 
$
41

 
$
34

 
$
30

Weighted-average period over which PSA cost is expected to be recognized (years)
 
1.8

 
1.8

 
1.8


(a) 
Includes the 2018 modification of a few PSAs to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial. Includes the 2017 modification for a commitment to pay 1.1 million PSAs to approximately 90 employees, including senior and key management employees, for 1.1 million PSAs. These shares were paid in the first quarter of 2018.

G. Stock Options

Stock options are awarded to select employees and, when vested, entitle the holder to purchase a specified number of shares of our common stock at a price per share equal to the closing market price of our common stock on the date of grant.

Beginning in 2016, only a limited set of overseas employees received stock option grants. No stock options were awarded to senior and other key management in any period presented; however, stock options were awarded to certain other employees. In virtually all instances, stock options granted vest after three years of continuous service from the grant date and have a contractual term of 10 years. In most cases, stock options must be held for at least one year from the grant date before any vesting may occur. In the event of a sale of business or plant closing or restructuring, options held by employees are immediately vested and are exercisable for a period of three months following the date employment is terminated or through their remaining term, depending on various conditions.

We measure the value of stock option grants as of the grant date using the Black-Scholes-Merton option-pricing model. The values determined through this fair value methodology generally are amortized on a straight-line basis over the vesting term into Cost of sales, Selling, informational and administrative expenses, and/or Research and development expenses, as appropriate.
The following table provides the weighted-average assumptions used in the valuation of stock options:
 
 
Year Ended December 31,
  
 
2018

 
2017

 
2016

Expected dividend yield(a)
 
3.73
%
 
3.69
%
 
3.85
%
Risk-free interest rate(b)
 
2.85
%
 
2.23
%
 
1.55
%
Expected stock price volatility(c)
 
20.02
%
 
18.39
%
 
21.64
%
Expected term (years)(d)
 
6.75

 
6.75

 
6.75

(a) 
Determined using a constant dividend yield during the expected term of the option.
(b) 
Determined using the interpolated yield on U.S. Treasury zero-coupon issues.
(c) 
Determined using implied volatility, after consideration of historical volatility.
(d) 
Determined using historical exercise and post-vesting termination patterns.
The following table summarizes all stock option activity during 2018:
 
 
Shares
(Thousands)

 
Weighted-Average
Exercise Price
Per Share

 
Weighted-Average
Remaining Contractual Term
(Years)
 
Aggregate
Intrinsic Value(a)
(Millions)

Outstanding, December 31, 2017
 
150,757

 
$
27.27

 
 
 
 
Granted
 
1,372

 
35.74

 
 
 
 
Exercised
 
(47,740
)
 
26.59

 
 
 
 
Forfeited
 
(219
)
 
33.96

 
 
 
 
Expired
 
(379
)
 
24.69

 
 
 
 
Outstanding, December 31, 2018(b)
 
103,791

 
27.69

 
4.4
 
$
1,657

Vested and expected to vest, December 31, 2018(c)
 
103,621

 
27.68

 
4.4
 
1,655

Exercisable, December 31, 2018
 
100,078

 
$
27.47

 
4.2
 
$
1,619

(a) 
Market price of our underlying common stock less exercise price.
(b) 
Includes the modification of approximately 190 thousand stock options to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit a longer exercise term after termination.
(c) 
The number of options expected to vest takes into account an estimate of expected forfeitures.
The following table summarizes data related to all stock option activity:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS, EXCEPT PER STOCK OPTION AMOUNTS)
 
2018

 
2017

 
2016

Weighted-average grant-date fair value per stock option
 
$
5.06

 
$
4.01

 
$
3.89

Aggregate intrinsic value on exercise
 
$
625

 
$
331

 
$
389

Cash received upon exercise
 
$
1,259

 
$
862

 
$
1,019

Tax benefits realized related to exercise
 
$
115

 
$
95

 
$
112

Total compensation cost related to nonvested stock options not yet recognized, pre-tax
 
$
5

 
$
10

 
$
58

Weighted-average period over which stock option compensation cost is expected to be recognized (years)
 
1.7

 
0.8

 
1.1
v3.10.0.1
Earnings Per Common Share Attributable to Pfizer Inc. Common Shareholders
 12 Months Ended
Dec. 31, 2018
Earnings Per Share [Abstract]  
Earnings Per Common Share Attributable to Pfizer Inc. Common Shareholders
Earnings Per Common Share Attributable to Pfizer Inc. Common Shareholders
The following table provides the detailed calculation of Earnings per common share (EPS):
 
 
Year Ended December 31,
(IN MILLIONS)
 
2018

 
2017

 
2016

EPS Numerator––Basic
 
 

 
 
 
 
Income from continuing operations
 
$
11,179

 
$
21,353

 
$
7,229

Less: Net income attributable to noncontrolling interests
 
36

 
47

 
31

Income from continuing operations attributable to Pfizer Inc.
 
11,143

 
21,306

 
7,198

Less: Preferred stock dividends––net of tax
 
1

 
1

 
1

Income from continuing operations attributable to Pfizer Inc. common shareholders
 
11,142

 
21,305

 
7,197

Discontinued operations––net of tax
 
10

 
2

 
17

Less: Discontinued operations––net of tax, attributable to noncontrolling interests
 
—

 
—

 
—

Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders
 
10

 
2

 
17

Net income attributable to Pfizer Inc. common shareholders
 
$
11,152

 
$
21,307

 
$
7,214

EPS Numerator––Diluted
 
 

 
 

 
 
Income from continuing operations attributable to Pfizer Inc. common shareholders and assumed conversions
 
$
11,143

 
$
21,306

 
$
7,197

Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders and assumed conversions
 
10

 
2

 
17

Net income attributable to Pfizer Inc. common shareholders and assumed conversions
 
$
11,153

 
$
21,308

 
$
7,214

EPS Denominator
 
 

 
 

 
 
Weighted-average number of common shares outstanding––Basic(a)
 
5,872

 
5,970

 
6,089

Common-share equivalents: stock options, stock issuable under employee compensation plans, convertible preferred stock and accelerated share repurchase agreements(a)
 
105

 
89

 
70

Weighted-average number of common shares outstanding––Diluted
 
5,977

 
6,058

 
6,159

Stock options that had exercise prices greater than the average market price of our common stock issuable under employee compensation plans(b)
 
2

 
36

 
63

Cash dividends declared per share
 
$
1.38

 
$
1.30

 
$
1.22

(a) 
2017 includes the effect of the modification for a commitment to pay 15.2 million common-share equivalents that were scheduled for near-term settlement. These common share equivalents were paid in the first quarter of 2018.
(b) 
These common stock equivalents were outstanding for the periods presented, but were not included in the computation of diluted EPS for those periods because their inclusion would have had an anti-dilutive effect.
v3.10.0.1
Lease Commitments
 12 Months Ended
Dec. 31, 2018
Leases [Abstract]  
Lease Commitments
Lease Commitments

We lease properties and equipment for use in our operations. In addition to rent, the leases may require us to pay directly for taxes, insurance, maintenance and other operating expenses or to pay higher rent when operating expenses increase. Rental expense, net of sublease income, was $301 million in 2018, $314 million in 2017 and $292 million in 2016.
The future minimum rental commitments under non-cancelable operating leases follow:
(MILLIONS OF DOLLARS)
 
2019

 
2020

 
2021

 
2022

 
2023

 
After 2023

Lease commitments
 
$
300

 
$
252

 
$
210

 
$
267

 
$
248

 
$
2,040
v3.10.0.1
Insurance
 12 Months Ended
Dec. 31, 2018
Insurance Coverage [Abstract]  
Insurance
Insurance

Our insurance coverage reflects market conditions (including cost and availability) existing at the time it is written, and our decision to obtain insurance coverage or to self-insure varies accordingly. Depending upon the cost and availability of insurance and the nature of the risk involved, the amount of self-insurance may be significant. The cost and availability of coverage have resulted in self-insuring certain exposures, including product liability. If we incur substantial liabilities that are not covered by insurance or substantially exceed insurance coverage and that are in excess of existing accruals, there could be a material adverse effect on our cash flows or results of operations in the period in which the amounts are paid and/or accrued (see Note 17).
v3.10.0.1
Contingencies and Certain Commitments
 12 Months Ended
Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]  
Contingencies and Certain Commitments
Contingencies and Certain Commitments

We and certain of our subsidiaries are subject to numerous contingencies arising in the ordinary course of business, including tax and legal contingencies. For a discussion of our tax contingencies, see Note 5D. For a discussion of our legal contingencies, see below.

A. Legal Proceedings

Our legal contingencies include, but are not limited to, the following:
•
Patent litigation, which typically involves challenges to the coverage and/or validity of patents on various products, processes or dosage forms. We are the plaintiff in the majority of these actions. An adverse outcome in actions in which we are the plaintiff could result in loss of patent protection for a drug, a significant loss of revenues from that drug or impairment of the value of associated assets.
•
Product liability and other product-related litigation, which can include personal injury, consumer, off-label promotion, securities, antitrust and breach of contract claims, among others, often involves highly complex issues relating to medical causation, label warnings and reliance on those warnings, scientific evidence and findings, actual, provable injury and other matters.
•
Commercial and other matters, which can include merger-related and product-pricing claims and environmental claims and proceedings, can involve complexities that will vary from matter to matter.
•
Government investigations, which often are related to the extensive regulation of pharmaceutical companies by national, state and local government agencies in the U.S. and in other jurisdictions. 

Certain of these contingencies could result in losses, including damages, fines and/or civil penalties, which could be substantial, and/or criminal charges.

We believe that our claims and defenses in matters in which we are a defendant are substantial, but litigation is inherently unpredictable and excessive verdicts do occur. We do not believe that any of these matters will have a material adverse effect on our financial position. However, we could incur judgments, enter into settlements or revise our expectations regarding the outcome of certain matters, and such developments could have a material adverse effect on our results of operations in the period in which the amounts are accrued and/or our cash flows in the period in which the amounts are paid.

We have accrued for losses that are both probable and reasonably estimable. Substantially all of our contingencies are subject to significant uncertainties and, therefore, determining the likelihood of a loss and/or the measurement of any loss can be complex. Consequently, we are unable to estimate the range of reasonably possible loss in excess of amounts accrued. Our assessments are based on estimates and assumptions that have been deemed reasonable by management, but the assessment process relies heavily on estimates and assumptions that may prove to be incomplete or inaccurate, and unanticipated events and circumstances may occur that might cause us to change those estimates and assumptions.

Amounts recorded for legal and environmental contingencies can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.

The principal pending matters to which we are a party are discussed below. In determining whether a pending matter is a principal matter, we consider both quantitative and qualitative factors in order to assess materiality, such as, among other things, the amount of damages and the nature of any other relief sought in the proceeding, if such damages and other relief are specified; our view of the merits of the claims and of the strength of our defenses; whether the action purports to be, or is, a class action and, if not certified, our view of the likelihood that a class will be certified by the court; the jurisdiction in which the proceeding is pending; whether related actions have been transferred to multidistrict litigation; any experience that we or, to our knowledge, other companies have had in similar proceedings; whether disclosure of the action would be important to a reader of our financial statements, including whether disclosure might change a reader’s judgment about our financial statements in light of all of the information that is available to the reader; the potential impact of the proceeding on our reputation; and the extent of public interest in the matter. In addition, with respect to patent matters in which we are the plaintiff, we consider, among other things, the financial significance of the product protected by the patent(s) at issue. As a result of considering qualitative factors in our determination of principal matters, there are some matters discussed below with respect to which management believes that the likelihood of possible loss in excess of amounts accrued is remote.

A1. Legal Proceedings––Patent Litigation

Like other pharmaceutical companies, we are involved in numerous suits relating to our patents, including but not limited to, those discussed below. Most of the suits involve claims by generic drug manufacturers that patents covering our products, processes or dosage forms are invalid and/or do not cover the product of the generic drug manufacturer. Also, counterclaims, as well as various independent actions, have been filed alleging that our assertions of, or attempts to enforce, patent rights with respect to certain products constitute unfair competition and/or violations of antitrust laws. In addition to the challenges to the U.S. patents on a number of our products that are discussed below, patent rights to certain of our products are being challenged in various other jurisdictions. We are also party to patent damages suits in various jurisdictions pursuant to which generic drug manufacturers, payers, governments or other parties are seeking damages from us for allegedly causing delay of generic entry. Additionally, our licensing and collaboration partners face challenges by generic drug manufacturers to patents covering products for which we have licenses or co-promotion rights. We also are often involved in other proceedings, such as inter partes review, post-grant review, re-examination or opposition proceedings, before the U.S. Patent and Trademark Office, the European Patent Office, or other foreign counterparts relating to our intellectual property or the intellectual property rights of others. Also, if one of our patents is found to be invalid by such proceedings, generic or competitive products could be introduced into the market resulting in the erosion of sales of our existing products. For example, several of the patents in our pneumococcal vaccine portfolio were challenged in inter partes review and post-grant review proceedings in the United States. In June 2018, the Patent Trial and Appeal Board ruled on one patent, holding that one claim was valid and that all other claims were invalid. The party challenging that patent has appealed the decision. Challenges to other patents remain pending before the U.S. Patent and Trademark Office. The invalidation of these patents could potentially allow a competitor pneumococcal vaccine into the marketplace. We are also subject to patent litigation pursuant to which one or more third parties seeks damages and/or injunctive relief to compensate for alleged infringement of its patents by our commercial or other activities. For example, our Hospira subsidiaries are involved in patent and patent-related disputes over their attempts to bring generic pharmaceutical and biosimilar products to market. If one of our marketed products is found to infringe valid patent rights of a third party, such third party may be awarded significant damages, or we may be prevented from further sales of that product. Such damages may be enhanced as much as three-fold in the event that we or one of our subsidiaries, like Hospira, is found to have willfully infringed valid patent rights of a third party.

Actions In Which We Are The Plaintiff
Bosulif (bosutinib)
In December 2016, Wyeth LLC, Wyeth Pharmaceuticals Inc., and PF Prism C.V. (collectively, Wyeth) brought a patent-infringement action against Alembic Pharmaceuticals, Ltd, Alembic Pharmaceuticals, Inc. (collectively, Alembic), Sun Pharmaceutical Industries, Inc., and Sun Pharmaceutical Industries Limited (collectively, Sun), in the U.S. District Court for the District of Delaware in connection with abbreviated new drug applications respectively filed with the FDA by Alembic and Sun, each seeking approval to market generic versions of bosutinib. Alembic is challenging patents, which expire in 2026, covering polymorphic forms of bosutinib and methods of treating chronic myelogenous leukemia. Sun is challenging the patent covering polymorphic forms of bosutinib that expires in 2026. In March 2017, Wyeth brought a patent-infringement action against MSN Laboratories Private Limited and MSN Pharmaceuticals, Inc. (collectively, MSN), in the U.S. District Court for the District of Delaware in connection with an abbreviated new drug application filed with the FDA by MSN, seeking approval to market a generic version of bosutinib, and challenging a patent expiring in 2026 covering polymorphic forms of bosutinib. In September 2017, the case against MSN was dismissed. Also, in September 2017, Wyeth brought an additional patent-infringement action against Sun in the U.S. District Court for the District of Delaware asserting the infringement and validity of two other patents challenged by Sun, which expire in 2025 and 2026, respectively, covering compositions of bosutinib and methods of treating chronic myelogenous leukemia.
EpiPen
In July 2010, King, which we acquired in 2011 and is a wholly-owned subsidiary, brought a patent-infringement action against Sandoz in the U.S. District Court for the District of New Jersey in connection with Sandoz’s abbreviated new drug application filed with the FDA seeking approval to market an epinephrine injectable product. Sandoz is challenging patents, which expire in 2025, covering the next-generation autoinjector for use with epinephrine that is sold under the EpiPen brand name.
Precedex Premix
In June 2014, Ben Venue Laboratories, Inc. (Ben Venue) notified our subsidiary, Hospira, that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that a patent relating to the use of Precedex in an intensive care unit setting, which expires in March 2019, was invalid or not infringed. In August 2014, Hospira and Orion Corporation (co-owner of the patent that is the subject of the lawsuit) filed suit against Ben Venue, Hikma Pharmaceuticals PLC (Hikma), and West-Ward Pharmaceutical Corp. in the U.S. District Court for the District of Delaware asserting the validity and infringement of the patent. In October 2014, Eurohealth International Sarl was substituted for Ben Venue and Hikma. In June 2016, this case was settled on terms not material to Pfizer.
In June 2015, Amneal Pharmaceuticals LLC (Amneal) notified Hospira that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that four patents relating to the Precedex premix formulations and their use, all of which expire in 2032, were invalid or not infringed. In August 2015, Hospira filed suit against Amneal in the U.S. District Court for the District of Delaware asserting the validity and infringement of the patents that are the subject of the lawsuit. In January 2018, the District Court ruled that one of the four patents was valid and infringed, and that the other three patents were invalid. In February and March 2018, respectively, each of Amneal and Hospira appealed the District Court decision to the U.S. Court of Appeals for the Federal Circuit. 

In December 2015, Fresenius Kabi USA LLC (Fresenius) notified Hospira that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that certain patents relating to the Precedex premix formulations and their use, all of which expire in 2032, were invalid or not infringed. In January 2016, Hospira filed suit against Fresenius in the U.S. District Court for the Northern District of Illinois, asserting the validity and infringement of those patents. In December 2018, the District Court ruled that the asserted patents were invalid. Hospira has appealed the District Court’s decision to the U.S. Court of Appeals for the Federal Circuit.

In August 2016, Par Sterile Products, LLC (Par) notified Hospira that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that four patents relating to the Precedex premix formulations and their use, all of which expire in 2032, were invalid or not infringed. In September 2016, Hospira filed suit against Par in the U.S. District Court for the District of Delaware asserting the validity and infringement of the patents that are the subject of the lawsuit. In December 2016, the case was stayed pending the outcome of Hospira’s suit against Amneal (including all appeals).

In December 2017, Gland Pharma Limited (Gland) notified Hospira that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that six patents relating to the Precedex premix formulations and their use, all of which expire in 2032, were invalid or not infringed. In February 2018, Hospira filed suit against Gland in the U.S. District Court for the District of Delaware asserting the validity and infringement of four patents that are the subject of the lawsuit.

In December 2017, Jiangsu Hengrui Medicine Co., Ltd. (Hengrui) notified Hospira that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Hospira’s premix version of Precedex and containing allegations that six patents relating to the Precedex premix formulations and their use, all of which expire in 2032, were invalid or not infringed. In February 2018, Hospira filed suit against Hengrui in the U.S. District Court for the District of Delaware asserting the validity and infringement of four patents that are the subject of the lawsuit.

In February 2018, Baxter Healthcare Corporation (Baxter) filed a declaratory judgment action against Hospira in the U.S. District Court for the District of Delaware seeking a declaration of non-infringement of four patents relating to the Precedex premix formulations and their use. One of the patents included in the action expires in 2019 and the other three patents expire in 2032. In March 2018, Hospira filed a counterclaim for infringement of the patent expiring in 2019. In November 2018, the case was dismissed by mutual agreement of the parties.
Xeljanz (tofacitinib)
In February 2017, we brought a patent-infringement action against MicroLabs USA Inc. and MicroLabs Ltd. (collectively, MicroLabs) in the U.S. District Court for the District of Delaware asserting the infringement and validity of three patents challenged by MicroLabs in its abbreviated new drug application seeking approval to market a generic version of tofacitinib 5 mg tablets. In November 2018, we settled all of our claims against MicroLabs on terms not material to Pfizer.

Separately, also in February 2017, we brought a patent-infringement action against Sun Pharmaceutical Industries Ltd. in the U.S. District Court for the District of Delaware asserting the infringement and validity of our patent covering a polymorphic form of tofacitinib, expiring in 2023, that was challenged by Sun Pharmaceutical Industries Ltd. in its abbreviated new drug application seeking approval to market a generic version of tofacitinib 11 mg extended release tablets. In November 2017, we brought an additional patent-infringement action against Sun Pharmaceutical Industries Ltd. in the U.S. District Court for the District of Delaware asserting the infringement and validity of another patent challenged by Sun Pharmaceutical Industries Ltd, which covers the active ingredient and expires in December 2025. In October 2018, we brought a third patent infringement action against Sun Pharmaceutical Industries Ltd. in the U.S. District Court for the District of Delaware asserting the infringement and validity of our patent covering the extended release formulation of tofacitinib, which expires in 2034.

In March 2017, we brought a patent-infringement action against Zydus Pharmaceuticals (USA) Inc. and Cadila Healthcare Ltd. (collectively, Zydus) in the U.S. District Court for the District of Delaware asserting the infringement and validity of three patents: the patent covering the active ingredient expiring in December 2025, the patent covering an entiomer of tofacitinib expiring in 2022, and the patent covering a polymorphic form of tofacitinib expiring in 2023, which Zydus challenged in its abbreviated new drug application seeking approval to market a generic version of tofacitinib 5 mg tablets.

Also, in March 2017, we brought separate actions in the U.S. District Court for the District of Delaware against Prinston Pharmaceutical Inc., Zhejiang Huahai Pharmaceutical Co., Ltd., Huahai US Inc. and Solco Healthcare US, LLC (collectively, Prinston) and against Breckenridge Pharmaceutical Inc., Pensa Pharma S.A. and Laboratorios Del Dr. Esteve, S.A. (collectively, Breckenridge) on the two patents expiring in 2022 and 2023, respectively, that were challenged by Prinston and Breckenridge in their respective abbreviated new drug applications seeking approval to market generic versions of tofacitinib 5 mg tablets. In October 2017, we brought an additional patent-infringement action against Breckenridge in the U.S. District Court for the District of Delaware asserting the infringement and validity of four additional patents challenged by Breckenridge, three of which expire in December 2020 and one of which expires in December 2025. In March 2018, we brought another patent infringement action against Prinston in the U.S. District Court for the District of Delaware asserting the infringement and validity of an additional patent, which had been subsequently challenged by Prinston and which expires in December 2025. In May 2018, we settled all of our claims against Breckenridge on terms not material to Pfizer. In January 2019, we settled all of our claims against Prinston on terms not material to Pfizer.

In December 2018, we brought a separate patent infringement action against Teva Pharmaceuticals USA, Inc. (Teva) in the U.S. District Court for the District of Delaware asserting the infringement and validity of our patent covering extended release formulations of tofacitinib that was challenged by Teva in its abbreviated new drug application seeking approval to market a generic version of tofacitinib 11 mg extended release tablets. 
Inlyta (axitinib)
In April 2018, Apotex Inc. notified us that it had filed an abbreviated new drug application with the FDA seeking approval to market a generic version of Inlyta. Apotex Inc. asserts the invalidity and non-infringement of the crystalline form patent for Inlyta that expires in 2030. In May 2018, we filed suit against Apotex Inc. in the U.S. District Court for the District of Delaware, asserting the validity and infringement of the crystalline form patent for Inlyta.
Kerydin (tavaborole)
In September 2018, several generic companies notified us that they had filed abbreviated new drug applications with the FDA seeking approval to market generic versions of Kerydin. The generic companies assert the invalidity and non-infringement of methods of use and formulation patents for tavaborole that expire in 2026 and 2027, including pediatric exclusivity. In October 2018, Anacor, our wholly-owned subsidiary, filed infringement lawsuits against each of the generic filers in the U.S. District Court for the District of Delaware and the U.S. District Court for the District of West Virginia.

Matters Involving Our Collaboration/Licensing Partners

Toviaz (fesoterodine)––Inter-Partes Reviews
In January 2016, Mylan Pharmaceuticals and Mylan Laboratories (collectively, Mylan) filed petitions with the U.S. Patent and Trademark Office requesting inter partes reviews of five of the patents covering fesoterodine, the active ingredient in Toviaz: three composition-of-matter patents and a method-of-use patent that expire in 2019 and a patent covering salts of fesoterodine that expires in 2022. The patents are owned by UCB Pharma GmbH, and we have an exclusive, worldwide license to market Toviaz from UCB Pharma GmbH. In July 2016, the Patent Trial and Appeal Board agreed to institute inter partes reviews of all five patents. Amerigen Pharmaceuticals Limited (Amerigen), Alembic Pharmaceuticals Limited and Torrent Pharmaceuticals Limited joined the inter partes reviews. In July 2017, the U.S. Patent and Trademark Office issued decisions upholding all five patents. In September 2017, Mylan and Amerigen appealed the U.S. Patent and Trademark Office decisions to the U.S. Court of Appeals for the Federal Circuit. In January 2018, Mylan withdrew its appeal. Amerigen’s appeal of the decision upholding the patent covering salts of fesoterodine that expires in 2022 was the only pending appeal. In January 2019, the U.S. Court of Appeals for the Federal Circuit affirmed the U.S. Patent and Trademark Office’s decision upholding the validity of the patent covering salts of fesoterodine that expires in 2022.

Xtandi (enzalutamide)
In December 2016, Medivation and Medivation Prostate Therapeutics, Inc. (collectively, the Medivation Group); Astellas Pharma Inc., Astellas US LLC and Astellas Pharma US, Inc. (collectively, Astellas); and The Regents of the University of California filed patent-infringement suits in the U.S. District Court for the District of Delaware against Actavis Laboratories FL, Inc. and Actavis LLC (collectively, Actavis); Zydus; and Apotex Inc. and Apotex Corp. (collectively, Apotex) in connection with those companies’ respective abbreviated new drug applications filed with the FDA for approval to market generic versions of enzalutamide. The generic manufacturers are challenging patents, which expire as early as 2026, covering enzalutamide and treatments for prostate cancer. In May 2017, the Medivation Group filed a patent-infringement suit against Roxane Laboratories Inc. (Roxane) in the same court in connection with Roxane’s abbreviated new drug application with the FDA for approval to market a generic version of enzalutamide. In June and July 2018, we settled all of our claims against Actavis and Apotex, respectively, on terms not material to Pfizer.

Eliquis
In February, March, and April 2017, twenty-five generic companies sent BMS Paragraph-IV certification letters informing BMS that they had filed abbreviated new drug applications seeking approval of generic versions of Eliquis, challenging the validity and infringement of one or more of the three patents listed in the Orange Book for Eliquis. The patents currently are set to expire in 2019, 2026, and 2031. Eliquis has been jointly developed and is being commercialized by BMS and Pfizer. In April 2017, BMS and Pfizer filed patent-infringement actions against all generic filers in the U.S. District Court for the District of Delaware and the U.S. District Court for the District of West Virginia, asserting that each of the generic companies’ proposed products would infringe each of the patent(s) that each generic filer challenged. Some generic filers challenged only the 2031 patent, some challenged both the 2031 and 2026 patent, and one generic company challenged all three patents. We and BMS have settled with certain of the generic companies on terms not material to Pfizer, and we and BMS may settle with other generic companies in the future.
Actions In Which We Are The Defendant
Inflectra (infliximab-dyyb)
In March 2015, Janssen and New York University, together, brought a patent-infringement action in the U.S. District Court for the District of Massachusetts against Hospira, Celltrion Healthcare Co. Ltd. and Celltrion Inc. alleging that infliximab-dyyb, to be marketed by Hospira in the U.S. under the brand name Inflectra, would infringe six patents relating to infliximab, its manufacture and use. Claims with respect to four of the patents were dismissed by the plaintiffs, leaving two patents at issue: the infliximab antibody patent and a patent relating to cell culture media. In January 2018, the antibody patent was declared invalid by the Court of Appeals for the Federal Circuit. In July 2018, the U.S. District Court for the District of Massachusetts granted defendants’ motion for summary judgment and ruled that the patent relating to cell culture media was not infringed. Janssen has appealed the District Court’s decision to the U.S. Court of Appeals for the Federal Circuit.
Bavencio (avelumab)
In July 2017, BMS, E.R. Squibb & Sons LLC, Ono Pharmaceutical Co. Ltd., and Tasuku Honjo brought a patent-infringement action in the U.S. District Court for the District of Delaware against Pfizer, Merck KGaA, and EMD Serono, Inc., alleging that Bavencio (avelumab) infringes one patent relating to methods for treating tumors with anti-PD-L1 antibodies, which expires in 2023. In February 2019, we settled this matter on terms not material to Pfizer.
A2. Legal Proceedings––Product Litigation

Like other pharmaceutical companies, we are defendants in numerous cases, including but not limited to those discussed below, related to our pharmaceutical and other products. Plaintiffs in these cases seek damages and other relief on various grounds for alleged personal injury and economic loss.
Asbestos
Between 1967 and 1982, Warner-Lambert owned American Optical Corporation (American Optical), which manufactured and sold respiratory protective devices and asbestos safety clothing. In connection with the sale of American Optical in 1982, Warner-Lambert agreed to indemnify the purchaser for certain liabilities, including certain asbestos-related and other claims. As of December 31, 2018, approximately 46,400 claims naming American Optical and numerous other defendants were pending in various federal and state courts seeking damages for alleged personal injury from exposure to asbestos and other allegedly hazardous materials. Warner-Lambert was acquired by Pfizer in 2000 and is a wholly-owned subsidiary of Pfizer. Warner-Lambert is actively engaged in the defense of, and will continue to explore various means of resolving, these claims.

Numerous lawsuits are pending against Pfizer in various federal and state courts seeking damages for alleged personal injury from exposure to products allegedly containing asbestos and other allegedly hazardous materials sold by Pfizer and certain of its previously owned subsidiaries.
There also are a small number of lawsuits pending in various federal and state courts seeking damages for alleged exposure to asbestos in facilities owned or formerly owned by Pfizer or its subsidiaries.

Effexor
Beginning in May 2011, actions, including purported class actions, were filed in various federal courts against Wyeth and, in certain of the actions, affiliates of Wyeth and certain other defendants relating to Effexor XR, which is the extended-release formulation of Effexor. The plaintiffs in each of the class actions seek to represent a class consisting of all persons in the U.S. and its territories who directly purchased, indirectly purchased or reimbursed patients for the purchase of Effexor XR or generic Effexor XR from any of the defendants from June 14, 2008 until the time the defendants’ allegedly unlawful conduct ceased. The plaintiffs in all of the actions allege delay in the launch of generic Effexor XR in the U.S. and its territories, in violation of federal antitrust laws and, in certain of the actions, the antitrust, consumer protection and various other laws of certain states, as the result of Wyeth fraudulently obtaining and improperly listing certain patents for Effexor XR in the Orange Book, enforcing certain patents for Effexor XR and entering into a litigation settlement agreement with a generic drug manufacturer with respect to Effexor XR. Each of the plaintiffs seeks treble damages (for itself in the individual actions or on behalf of the putative class in the purported class actions) for alleged price overcharges for Effexor XR or generic Effexor XR in the U.S. and its territories since June 14, 2008. All of these actions have been consolidated in the U.S. District Court for the District of New Jersey.
In October 2014, the District Court dismissed the direct purchaser plaintiffs’ claims based on the litigation settlement agreement, but declined to dismiss the other direct purchaser plaintiff claims. In January 2015, the District Court entered partial final judgments as to all settlement agreement claims, including those asserted by direct purchasers and end-payer plaintiffs, which plaintiffs appealed to the U.S. Court of Appeals for the Third Circuit. In August 2017, the U.S. Court of Appeals for the Third Circuit reversed the District Court’s decisions and remanded the claims to the District Court.
Lipitor
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Antitrust Actions
Beginning in November 2011, purported class actions relating to Lipitor were filed in various federal courts against, among others, Pfizer, certain affiliates of Pfizer, and, in most of the actions, Ranbaxy, Inc. (Ranbaxy) and certain affiliates of Ranbaxy. The plaintiffs in these various actions seek to represent nationwide, multi-state or statewide classes consisting of persons or entities who directly purchased, indirectly purchased or reimbursed patients for the purchase of Lipitor (or, in certain of the actions, generic Lipitor) from any of the defendants from March 2010 until the cessation of the defendants’ allegedly unlawful conduct (the Class Period). The plaintiffs allege delay in the launch of generic Lipitor, in violation of federal antitrust laws and/or state antitrust, consumer protection and various other laws, resulting from (i) the 2008 agreement pursuant to which Pfizer and Ranbaxy settled certain patent litigation involving Lipitor, and Pfizer granted Ranbaxy a license to sell a generic version of Lipitor in various markets beginning on varying dates, and (ii) in certain of the actions, the procurement and/or enforcement of certain patents for Lipitor. Each of the actions seeks, among other things, treble damages on behalf of the putative class for alleged price overcharges for Lipitor (or, in certain of the actions, generic Lipitor) during the Class Period. In addition, individual actions have been filed against Pfizer, Ranbaxy and certain of their affiliates, among others, that assert claims and seek relief for the plaintiffs that are substantially similar to the claims asserted and the relief sought in the purported class actions described above. These various actions have been consolidated for pre-trial proceedings in a Multi-District Litigation (In re Lipitor Antitrust Litigation MDL-2332) in the U.S. District Court for the District of New Jersey.

In September 2013 and 2014, the District Court dismissed with prejudice the claims by direct purchasers. In October and November 2014, the District Court dismissed with prejudice the claims of all other Multi-District Litigation plaintiffs. All plaintiffs have appealed the District Court’s orders dismissing their claims with prejudice to the U.S. Court of Appeals for the Third Circuit. In addition, the direct purchaser class plaintiffs appealed the order denying their motion to amend the judgment and for leave to amend their complaint to the U.S. Court of Appeals for the Third Circuit. In August 2017, the U.S. Court of Appeals for the Third Circuit reversed the District Court’s decisions and remanded the claims to the District Court.

Also, in January 2013, the State of West Virginia filed an action in West Virginia state court against Pfizer and Ranbaxy, among others, that asserts claims and seeks relief on behalf of the State of West Virginia and residents of that state that are substantially similar to the claims asserted and the relief sought in the purported class actions described above.
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Personal Injury Actions
A number of individual and multi-plaintiff lawsuits have been filed against us in various federal and state courts alleging that the plaintiffs developed type 2 diabetes purportedly as a result of the ingestion of Lipitor. Plaintiffs seek compensatory and punitive damages.
In February 2014, the federal actions were transferred for consolidated pre-trial proceedings to a Multi-District Litigation (In re Lipitor (Atorvastatin Calcium) Marketing, Sales Practices and Products Liability Litigation (No. II) MDL-2502) in the U.S. District Court for the District of South Carolina. Since 2016, certain cases in the Multi-District Litigation were remanded to certain state courts. In January 2017, the District Court granted our motion for summary judgment, dismissing substantially all of the remaining cases pending in the Multi-District Litigation. In January 2017, the plaintiffs appealed the District Court’s decision to the U.S. Court of Appeals for the Fourth Circuit. In June 2018, the U.S. Court of Appeals for the Fourth Circuit affirmed the District Court’s decision.
Viagra
A number of individual and multi-plaintiff lawsuits have been filed against us in various federal and state courts alleging that the plaintiffs developed melanoma and/or the exacerbation of melanoma purportedly as a result of the ingestion of Viagra. Plaintiffs seek compensatory and punitive damages.
In April 2016, the federal actions were transferred for coordinated pre-trial proceedings to a Multi-District Litigation (In Re: Viagra (Sildenafil Citrate) Products Liability Litigation, MDL-2691) in the U.S. District Court for the Northern District of California. In December 2016, federal actions filed against Lilly and filed against both us and Lilly, were transferred for coordinated pre-trial proceedings to the Multi-District Litigation (In re: Viagra (Sildenafil Citrate) and Cialis (Tadalafil) Products Liability Litigation, MDL-2691).
Intravenous Solutions
Beginning in November 2016, purported class actions were filed in the U.S. District Court for the Northern District of Illinois against Hospira, Hospira Worldwide, Inc. and certain other defendants relating to intravenous saline solution. Plaintiffs seek to represent a class consisting of all persons and entities in the U.S. who directly purchased intravenous saline solution sold by any of the defendants from January 1, 2013 until the time the defendants’ allegedly unlawful conduct ceases. Plaintiffs allege that the defendants’ conduct restricts output and artificially fixes, raises, maintains and/or stabilizes the prices of intravenous saline solution sold throughout the U.S. in violation of federal antitrust laws. Plaintiffs seek treble damages (for themselves and on behalf of the putative classes) and an injunction against defendants for alleged price overcharges for intravenous saline solution in the U.S. since January 1, 2013. All of these actions have been consolidated in the U.S. District Court for the Northern District of Illinois. In July 2018, the District Court granted defendants’ motions to dismiss the consolidated amended complaint without prejudice. Plaintiffs filed a second amended complaint in September 2018. On February 3, 2017, we completed the sale of our global infusion systems net assets, HIS, which includes intravenous saline solution, to ICU Medical. The litigation is the subject of cross-claims for indemnification by both Pfizer and ICU Medical under the purchase agreement.
Hormone Therapy Consumer Class Action
A certified consumer class action is pending against Wyeth in the U.S. District Court for the Southern District of California based on the alleged off-label marketing of its hormone therapy products. The case was originally filed in December 2003. The class consists of California consumers who purchased Wyeth’s hormone-replacement products between January 1995 and January 2003 and who do not seek personal injury damages therefrom. The class seeks compensatory and punitive damages, including a full refund of the purchase price.
Eliquis
A number of individual and multi-plaintiff lawsuits have been filed against us and BMS in various federal and state courts pursuant to which plaintiffs seek to recover for personal injuries, including wrongful death, due to bleeding allegedly as a result of the ingestion of Eliquis. Plaintiffs seek compensatory and punitive damages.
In February 2017, the federal actions were transferred for coordinated pre-trial proceedings to a Multi-District Litigation (In Re: Eliquis (Apixaban) Products Liability Litigation MDL-2754) in the U.S. District Court for the Southern District of New York. In July 2017, the District Court dismissed substantially all of the actions that were pending in the Multi-District Litigation. In August 2017, certain plaintiffs appealed the District Court’s dismissal to the U.S. Court of Appeals for the Second Circuit.
EpiPen
Beginning in February 2017, purported class actions were filed in various federal courts by indirect purchasers of EpiPen against Pfizer, and/or its affiliates King and Meridian, and/or various entities affiliated with Mylan N.V., and Mylan N.V. Chief Executive Officer, Heather Bresch. The plaintiffs in these actions seek to represent U.S. nationwide classes comprising persons or entities who paid for any portion of the end-user purchase price of an EpiPen between 2009 until the cessation of the defendants’ allegedly unlawful conduct. In August 2017, a similar lawsuit brought in the U.S. District Court for the District of New Jersey on behalf of a purported class of direct purchaser plaintiffs against Pfizer, King, Meridian and Mylan was voluntarily dismissed without prejudice. Against Pfizer and/or its affiliates, plaintiffs generally allege that Pfizer’s and/or its affiliates’ settlement of patent litigation regarding EpiPen delayed market entry of generic EpiPen in violation of federal antitrust laws and various state antitrust or consumer protection laws. At least one lawsuit also alleges that Pfizer and/or Mylan N.V. violated the federal Racketeer Influenced and Corrupt Organizations Act. Plaintiffs also filed various consumer protection and unjust enrichment claims against, and relating to conduct attributable solely to, Mylan Pharmaceuticals regarding EpiPen. Plaintiffs seek treble damages for alleged overcharges for EpiPen since 2009. In August 2017, the actions were consolidated for coordinated pre-trial proceedings in a Multi-District Litigation (In re: EpiPen (Epinephrine Injection, USP) Marketing, Sales Practices and Antitrust Litigation, MDL-2785) in the U.S. District Court for the District of Kansas with other EpiPen-related actions against Mylan N.V. and/or its affiliates to which Pfizer, King and Meridian are not parties.
Nexium 24HR and Protonix
A number of individual and multi-plaintiff lawsuits have been filed against Pfizer, certain of its subsidiaries and/or other pharmaceutical manufacturers in various federal and state courts alleging that the plaintiffs developed kidney-related injuries purportedly as a result of the ingestion of certain proton pump inhibitors. The cases against us involve Nexium 24HR and/or Protonix and seek compensatory and punitive damages and, in some cases, treble damages, restitution or disgorgement. In August 2017, the federal actions were ordered transferred for coordinated pre-trial proceedings to a Multi-District Litigation (In re: Proton-Pump Inhibitor Products Liability Litigation (No. II)) in the U.S. District Court for the District of New Jersey.
Docetaxel 
•
Personal Injury Actions
A number of lawsuits have been filed against Hospira and Pfizer in various federal and state courts alleging that plaintiffs who were treated with Docetaxel developed permanent hair loss. The significant majority of the cases also name other defendants, including the manufacturer of the branded product, Taxotere. Plaintiffs seek compensatory and punitive damages.
In October 2016, the federal cases were transferred for coordinated pre-trial proceedings to a Multi-District Litigation (In re Taxotere (Docetaxel) Products Liability Litigation, MDL-2740) in the U.S. District Court for the Eastern District of Louisiana.
•
Mississippi Attorney General Government Investigation
In October 2018, the Attorney General of Mississippi filed a complaint in Mississippi state court against the manufacturer of the branded product and eight other manufacturers including Pfizer and Hospira, alleging, with respect to Pfizer and Hospira, a failure to warn about a risk of permanent hair loss in violation of the Mississippi Consumer Protection Act. The action seeks civil penalties and injunctive relief. 
A3. Legal Proceedings––Commercial and Other Matters
Average Wholesale Price Litigation
Pfizer, certain of its subsidiaries and other pharmaceutical manufacturers were sued in various state courts by a number of states alleging that the defendants provided average wholesale price (AWP) information for certain of their products that was higher than the actual average prices at which those products were sold. The AWP is used to determine reimbursement levels under Medicare Part B and Medicaid and in many private-sector insurance policies and medical plans. All but one of those actions have been resolved through settlement, dismissal or final judgment. The plaintiff state, Illinois, in the one remaining action, claims that the alleged spread between the AWPs at which purchasers were reimbursed and the actual sale prices was promoted by the defendants as an incentive to purchase certain of their products. The action alleges, among other things, fraud and violation of the state’s unfair trade practices and consumer protection statutes and seeks monetary and other relief, including civil penalties and treble damages.

Monsanto-Related Matters
In 1997, Monsanto Company (Former Monsanto) contributed certain chemical manufacturing operations and facilities to a newly formed corporation, Solutia Inc. (Solutia), and spun off the shares of Solutia. In 2000, Former Monsanto merged with Pharmacia & Upjohn Company to form Pharmacia. Pharmacia then transferred its agricultural operations to a newly created subsidiary, named Monsanto Company (New Monsanto), which it spun off in a two-stage process that was completed in 2002. Pharmacia was acquired by Pfizer in 2003 and is a wholly-owned subsidiary of Pfizer.
In connection with its spin-off that was completed in 2002, New Monsanto assumed, and agreed to indemnify Pharmacia for, any liabilities related to Pharmacia’s former agricultural business. New Monsanto has defended and/or is defending Pharmacia in connection with various claims and litigation arising out of, or related to, the agricultural business, and has been indemnifying Pharmacia when liability has been imposed or settlement has been reached regarding such claims and litigation.
In connection with its spin-off in 1997, Solutia assumed, and agreed to indemnify Pharmacia for, liabilities related to Former Monsanto’s chemical businesses. As the result of its reorganization under Chapter 11 of the U.S. Bankruptcy Code, Solutia’s indemnification obligations relating to Former Monsanto’s chemical businesses are primarily limited to sites that Solutia has owned or operated. In addition, in connection with its spinoff that was completed in 2002, New Monsanto assumed, and agreed to indemnify Pharmacia for, any liabilities primarily related to Former Monsanto’s chemical businesses, including, but not limited to, any such liabilities that Solutia assumed. Solutia’s and New Monsanto’s assumption of, and agreement to indemnify Pharmacia for, these liabilities apply to pending actions and any future actions related to Former Monsanto’s chemical businesses in which Pharmacia is named as a defendant, including, without limitation, actions asserting environmental claims, including alleged exposure to polychlorinated biphenyls. Solutia and/or New Monsanto are defending Pharmacia in connection with various claims and litigation arising out of, or related to, Former Monsanto’s chemical businesses, and have been indemnifying Pharmacia when liability has been imposed or settlement has been reached regarding such claims and litigation.
Environmental Matters
In 2009, we submitted to the U.S. Environmental Protection Agency (EPA) a corrective measures study report with regard to Pharmacia’s discontinued industrial chemical facility in North Haven, Connecticut. In September 2010, our corrective measures study report was approved by the EPA, and we commenced construction of the site remedy in late 2011 under an Updated Administrative Order on Consent with the EPA.
Also, in 2009, we submitted a revised site-wide feasibility study with regard to Wyeth Holdings Corporation’s (formerly, American Cyanamid Company) discontinued industrial chemical facility in Bound Brook, New Jersey. In July 2011, Wyeth Holdings Corporation finalized an Administrative Settlement Agreement with the EPA and Order on Consent for Removal Action (the 2011 Administrative Settlement Agreement) with the EPA with regard to the Bound Brook facility. In May 2012, we completed construction of an interim remedy to address the discharge of impacted groundwater from that facility to the Raritan River. In September 2012, the EPA issued a final remediation plan for the Bound Brook facility’s main plant area, which is generally in accordance with one of the remedies evaluated in our revised site-wide feasibility study. In March 2013, Wyeth Holdings Corporation (now Wyeth Holdings LLC) entered into an Administrative Settlement Agreement and Order on Consent with the EPA to allow us to undertake detailed engineering design of the remedy for the main plant area and to perform a focused feasibility study for two adjacent lagoons. In September 2015, the U.S., on behalf of the EPA, filed a complaint and consent decree with the federal District Court for the District of New Jersey that allows Wyeth Holdings LLC to complete the design and to implement the remedy for the main plant area. In December 2015, the consent decree (which supersedes the 2011 Administrative Settlement Agreement) was entered by the District Court. We have accrued for the estimated costs of the site remedies for the North Haven and Bound Brook facilities. In September 2018, the EPA issued a final remediation plan for the two adjacent lagoons, which is generally in accordance with one of the remedies evaluated in our focused feasibility study.

We are a party to a number of other proceedings brought under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, and other state, local or foreign laws in which the primary relief sought is the cost of past and/or future remediation.
Contracts with Iraqi Ministry of Health
In October 2017, a number of United States service members, civilians, and their families brought a complaint in the Federal District Court for the District of Columbia against a number of pharmaceutical and medical devices companies, including Pfizer and certain of its subsidiaries, alleging that the defendants violated the United States Anti-Terrorism Act. The complaint alleges that the defendants provided funding for terrorist organizations through their sales practices pursuant to pharmaceutical and medical device contracts with the Iraqi Ministry of Health, and seeks monetary relief. In July 2018, the U.S. Department of Justice requested documents related to this matter, which are being provided.
Allergan Complaint for Indemnity
In August 2018, Pfizer was named as a defendant in a third-party complaint for indemnity, along with King, a Pfizer subsidiary, filed by Allergan Finance LLC (Allergan) in a Multi-District Litigation (In re National Prescription Opiate Litigation MDL 2804) in the U.S. District Court for the Northern District of Ohio. The lawsuit asserts claims for indemnity related to Kadian, which was owned for a short period by King in 2008, prior to Pfizer's acquisition of King in 2010. In December 2018, the District Court dismissed the lawsuit.
A4. Legal Proceedings––Government Investigations

Like other pharmaceutical companies, we are subject to extensive regulation by government agencies in the U.S., other developed markets and multiple emerging markets in which we operate. As a result, we have interactions with government agencies on an ongoing basis. Criminal charges, substantial fines and/or civil penalties, limitations on our ability to conduct business in applicable jurisdictions, corporate integrity or deferred prosecution agreements, as well as reputational harm and increased public interest in the matter could result from government investigations. In addition, in a qui tam lawsuit in which the government declines to intervene, the relator may still pursue a suit for the recovery of civil damages and penalties on behalf of the government. Among the investigations by government agencies are the matters discussed below.
Phenytoin Sodium Capsules
In 2012, Pfizer sold the U.K. Marketing Authorisation for phenytoin sodium capsules to a third party, but retained the right to supply the finished product to that third party. In May 2013, the U.K. Competition & Markets Authority (CMA) informed us that it had launched an investigation into the supply of phenytoin sodium capsules in the U.K. market. In August 2015, the CMA issued a Statement of Objections alleging that Pfizer and Pfizer Limited, a U.K. subsidiary, engaged in conduct that violates U.K. and EU antitrust laws. In December 2016, the CMA imposed a £84.2 million fine on Pfizer and Pfizer Limited. Pfizer appealed the CMA decision to The Competition Appeal Tribunal in February 2017. On June 7, 2018, the Competition Appeal Tribunal overturned the CMA decision as well as the associated fine. The CMA has appealed the judgment to the Court of Appeal.
Greenstone Investigations
Since July 2017, the U.S. Department of Justice’s Antitrust Division has been investigating our Greenstone generics business. We believe this is related to an ongoing antitrust investigation of the generic pharmaceutical industry. The government has been obtaining information from Greenstone. In April 2018, Greenstone received requests for information from the Antitrust Department of the Connecticut Office of the Attorney General. We have been providing information pursuant to these requests.
Subpoena relating to Manufacturing of Quillivant XR
In October 2018, we received a subpoena from the U.S. Attorney’s Office for the Southern District of New York seeking records relating to our relationship with another drug manufacturer and its production and manufacturing of drugs including, but not limited to, Quillivant XR. We are producing records pursuant to the subpoena.

Civil Investigative Demand relating to Meridian Medical Technologies
In February 2019, we received a civil investigative demand from the U.S. Attorney’s Office for the Southern District of New York (SDNY).  The civil investigative demand seeks records and information related to alleged quality issues involving the manufacture of auto-injectors at our Meridian site.  We will be producing records in response to this civil investigative demand.

Intravenous Solutions
See Note 17A5. Contingencies and Certain Commitments Legal Proceedings––Matters Resolved During 2018––Intravenous Solutions Government Investigation below for information regarding government investigations related to sales of intravenous solution products.
Contracts with Iraqi Ministry of Health
See Note 17A3. Contingencies and Certain Commitments: Legal Proceedings––Commercial and Other Matters––Contracts with Iraqi Ministry of Health above for information regarding U.S. government investigations related to contracts with the Iraqi Ministry of Health.
Docetaxel––Mississippi Attorney General Government Investigation
See Note 17A2. Contingencies and Certain Commitments: Legal Proceedings––Product Litigation––Docetaxel––Mississippi Attorney General Government Investigation above for information regarding a government investigation related to Docetaxel marketing practices.
A5. Legal Proceedings––Matters Resolved During 2018
During 2018, certain matters, including the matters discussed below, were resolved or were the subject of definitive settlement agreements or settlement agreements-in-principle.
Celebrex
Beginning in July 2014, purported class actions were filed in the U.S. District Court for the Eastern District of Virginia against Pfizer and certain subsidiaries of Pfizer relating to Celebrex. The plaintiffs sought to represent U.S. nationwide or multi-state classes consisting of persons or entities who directly purchased from the defendants, or indirectly purchased or reimbursed patients for some or all of the purchase price of, Celebrex or generic Celebrex from May 31, 2014 until the cessation of the defendants’ allegedly unlawful conduct. The plaintiffs alleged delay in the launch of generic Celebrex in violation of federal antitrust laws or certain state antitrust, consumer protection and various other laws as a result of Pfizer fraudulently obtaining and improperly listing a patent on Celebrex, engaging in sham litigation and prolonging the impact of sham litigation through settlement activity that further delayed generic entry. Each of the actions sought treble damages on behalf of the putative class for alleged price overcharges for Celebrex since May 31, 2014. In December 2014, the District Court granted the parties’ joint motions to consolidate the direct purchaser and end-payer cases, and all such cases were consolidated as of March 2015. In October 2014 and March 2015, we filed motions to dismiss the direct purchasers’ and end-payers’ amended complaints, respectively. In November 2015, the District Court denied in part and granted in part our motion to dismiss the direct purchasers’ amended complaint. In February 2016, the District Court denied in part and granted in part our motion to dismiss the end-payers’ amended complaint, and in August 2016, the District Court dismissed substantially all of the end-payers’ remaining claims. In February 2017, the District Court dismissed with prejudice all of the end-payers’ claims. In March 2017, the end-payers appealed the District Court’s order dismissing their claims with prejudice to the U.S. Court of Appeals for the Fourth Circuit. In August 2017, the District Court granted the direct purchasers’ motion for class certification. In November 2017, Pfizer and the direct purchasers entered into an agreement to resolve the direct purchasers’ class action for $94 million. In April 2018, the court approved the agreement. In November 2017, Pfizer and the end-payers entered into an agreement to resolve the claims of the end-payer plaintiffs on terms not material to Pfizer.
Subpoenas relating to Copayment Assistance Organizations
In December 2015 and July 2016, Pfizer received subpoenas from the U.S. Attorney’s Office for the District of Massachusetts requesting documents related to the Patient Access Network Foundation and other IRC 501(c)(3) organizations that provide financial assistance to Medicare patients. In May 2018, Pfizer entered into a civil settlement to resolve the matter. Pfizer paid $23.85 million to the United States, and entered into a five-year Corporate Integrity Agreement with the Office of the Inspector General of the Department of Health and Human Services.
Civil Investigative Demand relating to Pharmacy Benefit Managers
In March 2016, Pfizer received a civil investigative demand from the U.S. Attorney’s Office for the SDNY related to Pfizer’s contractual relationships with pharmacy benefit managers with respect to certain pharmaceutical products over the period from January 1, 2006 to the present. We have provided information to the government in response to this civil investigative demand. In July 2018, Pfizer was served with a qui tam complaint that appears to be related to the SDNY investigation. The complaint was unsealed following the government’s decision not to intervene in the case.
Intravenous Solutions Government Investigation
In April 2017, Pfizer, Hospira and two employees of Pfizer received grand jury subpoenas issued by the United States District Court for the Eastern District of Pennsylvania, in connection with an investigation by the U.S. Department of Justice, Antitrust Division. The subpoenas seek documents related to the sale, manufacture, pricing and shortages of intravenous solutions, including saline, as well as communications among industry participants regarding these issues. The Department of Justice investigation is also the subject of cross-claims for indemnification by both Pfizer and ICU Medical under the purchase agreement. In addition, in August 2015, the New York Attorney General issued a subpoena to Hospira for similar information. Hospira has produced records to the New York Attorney General and coordinated with ICU Medical to produce records to the U.S. Department of Justice. In December 2018, the U.S. Department of Justice informed Pfizer that it had closed its investigation.
B. Guarantees and Indemnifications
In the ordinary course of business and in connection with the sale of assets and businesses and other transactions, we often indemnify our counterparties against certain liabilities that may arise in connection with the transaction or that are related to events and activities prior to or following a transaction. If the indemnified party were to make a successful claim pursuant to the terms of the indemnification, we may be required to reimburse the loss. These indemnifications are generally subject to various restrictions and limitations. Historically, we have not paid significant amounts under these provisions and, as of December 31, 2018, the estimated fair value of these indemnification obligations was not significant.
In addition, in connection with our entry into certain agreements, our counterparties agree to indemnify us. For example, our collaboration agreement with EMD Serono, Inc. to co-promote Rebif in the U.S. expired at the end of 2015 and included certain indemnity provisions. Patent litigation brought by Biogen Idec MA Inc. against EMD Serono Inc. and Pfizer is pending in the U.S. District Court for the District of New Jersey and the United States Court of Appeals for the Federal Circuit. EMD Serono Inc. has acknowledged that it is obligated to satisfy any award of damages.
Pfizer Inc. has also guaranteed the long-term debt of certain companies that it acquired and that now are subsidiaries of Pfizer.
C. Certain Commitments
•
As of December 31, 2018, we had agreements totaling $3.7 billion to purchase goods and services that are enforceable and legally binding and include amounts relating to advertising, information technology services, employee benefit administration services, and potential milestone payments deemed reasonably likely to occur.
•
As of December 31, 2018, we have obligations to make guaranteed fixed annual payments over an eight-year period in connection with the U.S. and EU approvals for Besponsa ($422 million) and an obligation to make guaranteed fixed annual payments over a nine-year period for Bosulif ($240 million), both associated with R&D arrangements.
•
As of December 31, 2018, in connection with the TCJA, we have an estimated $15 billion repatriation tax liability on accumulated post-1986 earnings of foreign subsidiaries for which we plan to elect, with the filing of our 2018 U.S. Federal Consolidated Income Tax Return, payment over eight years through 2026. The first installment, due in April 2019, is reported in Income taxes payable and the remaining installments are reported in Other taxes payable in our consolidated balance sheet as of December 31, 2018. Our obligations may vary as a result of changes in our uncertain tax positions and/or availability of attributes such as foreign tax and other credit carryforwards. See Note 5A for additional information.
v3.10.0.1
Segment, Geographic and Other Revenue Information
 12 Months Ended
Dec. 31, 2018
Segment Reporting [Abstract]  
Segment, Geographic and Other Revenue Information
Segment, Geographic and Other Revenue Information

A. Segment Information

We regularly review our segments and the approach used by management to evaluate performance and allocate resources. At the
beginning of our fiscal year 2019, we reorganized our commercial operations. Prior to the reorganization effective January 1, 2019, we managed our commercial operations through two distinct business segments: Pfizer Innovative Health (IH) and Pfizer Essential Health (EH). The IH and EH operating segments were each led by a single manager. Each operating segment had responsibility for its commercial activities and for certain IPR&D projects for new investigational products and additional indications for in-line products that generally have achieved proof-of-concept. Each business had a geographic footprint across developed and emerging markets. Our chief operating decision maker used the revenues and earnings of the two operating segments, among other factors, for performance evaluation and resource allocation. As described in Note 1A, acquisitions and divestitures have impacted our results of operations in 2018, 2017 and 2016.

Some additional information about our business segments and other costs and business activities as of December 31, 2018 (prior to our new 2019 commercial organizational re-alignment) follows:

Operating Segments
pihlogo.jpg
 
pehlogo.jpg
IH focused on developing and commercializing novel, value-creating medicines and vaccines that significantly improve patients’ lives, as well as products for consumer healthcare.

Key therapeutic areas included internal medicine, vaccines, oncology, inflammation & immunology, rare disease and consumer healthcare.
 
EH included legacy brands that have lost or will soon lose market exclusivity in both developed and emerging markets, branded generics, generic sterile injectable products, biosimilars and select branded products including anti-infectives. EH also included an R&D organization, as well as our contract manufacturing business. Through February 2, 2017, EH also included HIS.
Leading brands included:
- Prevnar 13/Prevenar 13
- Xeljanz
- Eliquis
- Lyrica (U.S., Japan and certain other markets)
- Enbrel (outside the U.S. and Canada)
- Ibrance
- Xtandi
- Chantix/Champix
- Several OTC consumer healthcare products (e.g., Centrum and Advil)
 
Leading brands included:
- Lipitor
- Norvasc
- Lyrica (Europe, Russia, Turkey, Israel and Central Asia countries)
- Celebrex
- Viagra*
- Inflectra/Remsima
- Sulperazon
- Several other sterile injectable products

*
Viagra lost exclusivity in the U.S. in December 2017. In 2018, revenues for Viagra in the U.S. and Canada, which were reported in IH through 2017, were reported in EH (which reported all other Viagra revenues excluding the U.S. and Canada through 2017). Therefore, in 2018, total Viagra worldwide revenues were reported in EH.
The following organizational change impacted our operating segments in 2018:
•
Effective in the first quarter of 2018, certain costs for Pfizer’s StratCO group, which were previously reported in the operating results of our operating segments and Corporate, are reported in Other Unallocated. StratCO costs primarily include headcount costs, vendor costs and data costs largely in support of Pfizer’s commercial operations. The majority of the StratCO costs reflect additional amounts that our operating segments would have incurred had each segment operated as a standalone company during the periods presented. The reporting change was made to streamline accountability and speed decision making. In 2017, we reclassified approximately $468 million of costs from IH, approximately $176 million of costs from EH and approximately $70 million of costs from Corporate to Other unallocated costs to conform to the current period presentation, and in 2016, we reclassified approximately $312 million of costs from IH, approximately $167 million of costs from EH and approximately $43 million of costs from Corporate to Other unallocated costs to conform to the current period presentation.
Other Costs and Business Activities

Certain pre-tax costs are not allocated to our operating segment results, such as costs associated with the following:
•
WRD, which is generally responsible for research projects for our IH business until proof-of-concept is achieved and then for transitioning those projects to the IH segment via the GPD organization for possible clinical and commercial development. R&D spending may include upfront and milestone payments for intellectual property rights. The WRD organization also has responsibility for certain science-based and other platform-services organizations, which provide technical expertise and other services to the various R&D projects, including EH R&D projects. WRD is also responsible for facilitating all regulatory submissions and interactions with regulatory agencies, including all safety-event activities.
•
GPD, which is generally responsible for the operational execution of clinical trials for both early-stage assets in the WRD portfolio as well as late-stage assets in the Innovative portfolio. GPD also provides technical support and other services to Pfizer R&D projects.
•
Corporate, representing platform functions (such as worldwide technology, global real estate operations, legal, finance, human resources, worldwide public affairs, compliance and worldwide procurement), the provision of medical information to healthcare providers, patients and other parties, transparency and disclosure activities, clinical trial results publication, grants for healthcare quality improvement and medical education, and partnerships with global public health and medical associations, as well as certain compensation and other corporate costs, such as interest income and expense, and gains and losses on investments. Effective in the first quarter of 2018, certain costs for StratCO, which were previously reported in the operating results of our operating segments and Corporate, are reported in Other Unallocated. For additional information, see note below on Other unallocated costs.
•
Other unallocated costs, representing overhead expenses associated with our manufacturing and commercial operations that are not directly assessed to an operating segment, as business unit (segment) management does not manage these costs (which include manufacturing variances associated with production). In connection with the StratCO reporting change, in 2017, we reclassified approximately $468 million of costs from IH, approximately $176 million of costs from EH and approximately $70 million of costs from Corporate to Other unallocated costs to conform to the current period presentation, and in 2016, we reclassified approximately $312 million of costs from IH, approximately $167 million of costs from EH and approximately $43 million of costs from Corporate to Other unallocated costs to conform to the current period presentation.
•
Certain transactions and events such as (i) purchase accounting adjustments, where we incur expenses associated with the amortization of fair value adjustments to inventory, intangible assets and PP&E; (ii) acquisition-related costs, where we incur costs for executing the transaction, integrating the acquired operations and restructuring the combined company; and (iii) certain significant items, representing substantive and/or unusual, and in some cases recurring, items (such as restructuring or legal charges) that are evaluated on an individual basis by management and that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis. Such items can include, but are not limited to, non-acquisition-related restructuring costs, as well as costs incurred for legal settlements, asset impairments and disposals of assets or businesses, including, as applicable, any associated transition activities.

Segment Assets

We manage our assets on a total company basis, not by operating segment, as many of our operating assets are shared (such as our plant network assets) or commingled (such as accounts receivable, as many of our customers are served by both operating segments). Therefore, our chief operating decision maker does not regularly review any asset information by operating segment and, accordingly, we do not report asset information by operating segment. Total assets were approximately $159 billion as of December 31, 2018 and approximately $172 billion as of December 31, 2017.
Selected Income Statement Information
As described in Note 1A, acquisitions and divestitures have impacted our results of operations in 2018, 2017 and 2016.
The following table provides selected income statement information by reportable segment:
 
 
Revenues
 
Earnings(a)
 
Depreciation and Amortization(b)
 
 
Year Ended December 31,
 
Year Ended December 31,
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

Reportable Segments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
IH(c)
 
$
33,426

 
$
31,422

 
$
29,197

 
$
20,258

 
$
18,809

 
$
16,166

 
$
629

 
$
534

 
$
583

EH(c)
 
20,221

 
21,124

 
23,627

 
10,712

 
11,460

 
13,065

 
547

 
579

 
600

Total reportable segments
 
53,647

 
52,546

 
52,824

 
30,970

 
30,269

 
29,231

 
1,175

 
1,113

 
1,183

Other business activities(d), (e)
 
—

 
—

 
—

 
(2,977
)
 
(3,137
)
 
(3,020
)
 
93

 
90

 
85

Reconciling Items:
 
 

 
 

 


 
 

 
 

 


 


 


 


Corporate(c), (e)
 
—

 
—

 
—

 
(5,096
)
 
(5,452
)
 
(5,448
)
 
363

 
337

 
356

Purchase accounting adjustments(e)
 
—

 
—

 
—

 
(4,786
)
 
(4,758
)
 
(4,185
)
 
4,620

 
4,565

 
3,890

Acquisition-related costs(e)
 
—

 
—

 
—

 
(318
)
 
(456
)
 
(785
)
 
12

 
39

 
7

Certain significant items(f)
 
—

 
—

 
—

 
(4,305
)
 
(2,647
)
 
(5,888
)
 
38

 
52

 
200

Other unallocated(c), (e)
 
—

 
—

 
—

 
(1,603
)
 
(1,514
)
 
(1,554
)
 
82

 
72

 
35

 
 
$
53,647

 
$
52,546

 
$
52,824

 
$
11,885

 
$
12,305

 
$
8,351

 
$
6,384

 
$
6,269

 
$
5,757

(a) 
Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
(b) 
Certain production facilities are shared. Depreciation is allocated based on estimates of physical production. Amounts here relate solely to the depreciation and amortization associated with continuing operations.
(c) 
In connection with the StratCO reporting change, in 2017, we reclassified approximately $468 million of costs from IH, approximately $176 million of costs from EH and approximately $70 million of costs from Corporate to Other unallocated costs, and in 2016, we reclassified approximately $312 million of costs from IH, approximately $167 million of costs from EH and approximately $43 million of costs from Corporate to Other unallocated costs to conform to the current period presentation.
(d) 
Other business activities includes the costs managed by our WRD and GPD organizations.
(e) 
For a description, see the “Other Costs and Business Activities” section above.
(f) 
Certain significant items are substantive and/or unusual, and in some cases recurring, items (such as restructuring or legal charges) that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis.
For Earnings in 2018, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $977 million, (ii) net charges for certain legal matters of $157 million, (iii) income of $1 million, representing an adjustment to amounts previously recorded to write down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $3.1 billion, (v) charges for business and legal entity alignment of $4 million, (vi) net losses on early retirement of debt of $3 million and (vii) other charges of $65 million, which includes, among other things, a non-cash $343 million pre-tax gain in Other (income)/deductions––net associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system, a $119 million charge, in the aggregate, in Selling, informational and administrative expenses, for a special one-time bonus paid to virtually all Pfizer colleagues, excluding executives, which was one of several actions taken by us after evaluating the expected positive net impact of the December 2017 enactment of the legislation commonly referred to as the TCJA, $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily including consulting, legal, tax, and advisory services and a non-cash $50 million pre-tax gain in Other (income)/deductions––net as a result of the contribution of our allogeneic CAR T cell therapy development program assets in connection with our contribution agreement entered into with Allogene. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2017, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $204 million, (ii) charges for certain legal matters of $237 million, (iii) charges of $55 million, representing adjustments to amounts previously recorded to write-down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $379 million, (v) charges for business and legal entity alignment of $71 million, (vi) net losses on early retirement of debt of $999 million and (vii) other charges of $700 million. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $1.4 billion, (ii) charges for certain legal matters of $494 million, (iii) an impairment charge related to the write-down of the HIS net assets to fair value less estimated costs to sell of $1.7 billion, (iv) certain asset impairment charges of $1.4 billion, (v) charges for business and legal entity alignment of $261 million, (vi) net losses on early retirement of debt of $312 million and (vii) other charges of $294 million. For additional information, see Note 3 and Note 4.
Equity in the net income of investees accounted for by the equity-method is not significant for any of our operating segments.
The operating segment information does not purport to represent the revenues, costs and Income from continuing operations before provision/(benefit) for taxes on income that each of our operating segments would have recorded had each segment operated as a standalone company during the periods presented.

B. Geographic Information
As described in Note 1A, the February 3, 2017 sale of HIS impacted our results of operations in 2018, 2017 and 2016.
The following table provides revenues by geographic area:
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
2018

 
2017

 
2016

United States
$
25,329

 
$
26,026

 
$
26,369

Developed Europe(a)
9,116

 
8,508

 
9,306

Developed Rest of World(b)
6,551

 
6,612

 
6,729

Emerging Markets (c)
12,651

 
11,399

 
10,420

Revenues
$
53,647

 
$
52,546

 
$
52,824


(a) 
Developed Europe region includes the following markets: Western Europe, Scandinavian countries and Finland. Revenues denominated in euros were $7.3 billion in 2018, $6.8 billion in 2017 and $7.2 billion in 2016.
(b) 
Developed Rest of World region includes the following markets: Japan, Canada, South Korea, Australia and New Zealand.
(c) 
Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Eastern Europe, Africa, the Middle East, Central Europe and Turkey.
Revenues exceeded $500 million in each of 11 countries outside the U.S. in 2018, 2017 and 2016. The U.S. is the only country to contribute more than 10% of total revenue in 2018, 2017 and 2016. As a percentage of revenues, our two largest national markets outside the U.S. were Japan, which contributed 8% of total revenue in each of 2018, 2017 and 2016, and China, which contributed 8% of total revenue in 2018, 7% of total revenue in 2017 and 6% of total revenues in 2016.
The following table provides long-lived assets by geographic area:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Property, plant and equipment, net
 
 
 
 
 
 
United States
 
$
7,089

 
$
6,971

 
$
6,649

Developed Europe(a)
 
4,204

 
4,345

 
4,228

Developed Rest of World(b)
 
490

 
632

 
643

Emerging Markets(c)
 
1,602

 
1,917

 
1,797

Property, plant and equipment, net
 
$
13,385

 
$
13,865

 
$
13,318


(a) 
Developed Europe region includes the following markets: Western Europe, Scandinavian countries and Finland.
(b) 
Developed Rest of World region includes the following markets: Japan, Canada, South Korea, Australia and New Zealand.
(c) 
Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Eastern Europe, Africa, the Middle East, Central Europe and Turkey.
C. Other Revenue Information

Significant Customers

We sell our biopharmaceutical products primarily to customers in the wholesale sector. In 2018, sales to our three largest U.S. wholesaler customers represented approximately 15%, 11% and 10% of total revenues, respectively, and, collectively, represented approximately 34% of total trade accounts receivable as of December 31, 2018. In 2017, sales to our three largest U.S. wholesaler customers represented approximately 16%, 12% and 10% of total revenues, respectively, and, collectively, represented approximately 36% of total trade accounts receivable as of December 31, 2017. In 2016, sales to our three largest U.S. wholesaler customers represented approximately 16%, 12% and 10% of total revenues, respectively, and, collectively, represented approximately 29% of total trade accounts receivable as of December 31, 2016. For all years presented, these sales and related trade accounts receivable were concentrated in our biopharmaceutical businesses.
Significant Product Revenues
As described in Note 1A, acquisitions and divestitures have impacted our results of operations in 2018, 2017 and 2016.
The following table provides detailed revenue information for several of our major products:
(MILLIONS OF DOLLARS)
 
 
 
Year Ended December 31,
PRODUCT
 
PRIMARY INDICATION OR CLASS
 
2018

 
2017

 
2016

TOTAL REVENUES
 
 
 
$
53,647

 
$
52,546

 
$
52,824

PFIZER INNOVATIVE HEALTH (IH)(a)
 
$
33,426

 
$
31,422

 
$
29,197

Internal Medicine
 
$
9,996

 
$
9,684

 
$
8,858

Lyrica IH(b)
 
Epilepsy, post-herpetic neuralgia and diabetic peripheral neuropathy, fibromyalgia, neuropathic pain due to spinal cord injury
 
4,622

 
4,511

 
4,165

Eliquis alliance revenues and direct sales
 
Atrial fibrillation, deep vein thrombosis, pulmonary embolism
 
3,434

 
2,523

 
1,713

Chantix/Champix
 
An aid to smoking cessation treatment in adults 18 years of age or older
 
1,085

 
997

 
842

BMP2
 
Development of bone and cartilage
 
279

 
261

 
251

Toviaz
 
Overactive bladder
 
271

 
257

 
258

Viagra IH(c)
 
Erectile dysfunction
 
—

 
823

 
1,181

All other Internal Medicine
 
Various
 
306

 
312

 
447

Vaccines
 
$
6,332

 
$
6,001

 
$
6,071

Prevnar 13/Prevenar 13
 
Vaccines for prevention of pneumococcal disease
 
5,802

 
5,601

 
5,718

FSME/IMMUN-TicoVac
 
Tick-borne encephalitis vaccine
 
184

 
134

 
114

Trumenba
 
Meningococcal Group B vaccine
 
116

 
88

 
84

All other Vaccines
 
Various
 
230

 
177

 
155

Oncology
 
$
7,202

 
$
6,056

 
$
4,563

Ibrance
 
Advanced breast cancer
 
4,118

 
3,126

 
2,135

Sutent
 
Advanced and/or metastatic RCC, adjuvant RCC, refractory GIST (after disease progression on, or intolerance to, imatinib mesylate) and advanced pancreatic neuroendocrine tumor
 
1,049

 
1,081

 
1,095

Xtandi alliance revenues
 
Castration-resistant prostate cancer
 
699

 
590

 
140

Xalkori
 
ALK-positive and ROS1-positive advanced NSCLC
 
524

 
594

 
561

Inlyta
 
Advanced RCC
 
298

 
339

 
401

Bosulif
 
Philadelphia chromosome–positive chronic myelogenous leukemia
 
296


233


167

All other Oncology
 
Various
 
219

 
93

 
63

Inflammation & Immunology (I&I)
 
$
4,080

 
$
3,968

 
$
3,928

Enbrel (Outside the U.S. and Canada)
 
RA, juvenile idiopathic arthritis, PsA, plaque psoriasis, pediatric plaque psoriasis, ankylosing spondylitis and nonradiographic axial spondyloarthritis
 
2,112

 
2,452

 
2,909

Xeljanz
 
RA, PsA, ulcerative colitis
 
1,774

 
1,345

 
927

Eucrisa
 
Mild-to-moderate atopic dermatitis (eczema)
 
147


67


—

All other I&I
 
Various
 
46

 
103

 
93

Rare Disease
 
$
2,211

 
$
2,240

 
$
2,369

Genotropin
 
Replacement of human growth hormone
 
558

 
532

 
579

BeneFIX
 
Hemophilia
 
554

 
604

 
712

Refacto AF/Xyntha
 
Hemophilia
 
514

 
551

 
554

Somavert
 
Acromegaly
 
267

 
254

 
232

All other Rare Disease
 
Various
 
318

 
300

 
292

Consumer Healthcare
 
 
 
$
3,605

 
$
3,472

 
$
3,407

PFIZER ESSENTIAL HEALTH (EH)(d)
 
$
20,221

 
$
21,124

 
$
23,627

Legacy Established Products (LEP)(e)
 
$
10,540

 
$
10,894

 
$
11,197

Lipitor
 
Reduction of LDL cholesterol
 
2,062

 
1,915

 
1,758

Norvasc
 
Hypertension
 
1,024

 
926

 
962

Premarin family
 
Symptoms of menopause
 
832

 
977

 
1,017

Xalatan/Xalacom
 
Glaucoma and ocular hypertension
 
318

 
335

 
363

Effexor
 
Depression and certain anxiety disorders
 
311

 
297

 
278

EpiPen
 
Epinephrine injection used in treatment of life-threatening allergic reactions
 
303

 
290

 
386

Zoloft
 
Depression and certain anxiety disorders
 
298

 
291

 
304

Zithromax
 
Bacterial infections
 
290

 
270

 
272

Xanax
 
Anxiety disorders
 
223

 
225

 
222

Sildenafil Citrate
 
Erectile dysfunction
 
56

 
56

 
—

All other LEP
 
Various
 
4,822

 
5,313

 
5,636

(MILLIONS OF DOLLARS)
 
 
 
Year Ended December 31,
PRODUCT
 
PRIMARY INDICATION OR CLASS
 
2018

 
2017

 
2016

Sterile Injectable Pharmaceuticals (SIP)(f)
 
$
5,214

 
$
5,673

 
$
6,014

Sulperazon
 
Treatment of infections
 
613

 
471

 
396

Medrol
 
Steroid anti-inflammatory
 
427

 
483

 
450

Fragmin
 
Slows blood clotting
 
293

 
306

 
318

Tygacil
 
Tetracycline class antibiotic
 
249

 
260

 
274

Zosyn/Tazocin
 
Antibiotic
 
229

 
194

 
146

Precedex
 
Sedation agent in surgery or intensive care
 
213

 
243

 
264

All other SIP
 
Various
 
3,191

 
3,715

 
4,166

Peri-LOE Products(g)
 
$
2,944

 
$
3,223

 
$
4,220

Celebrex
 
Arthritis pain and inflammation, acute pain
 
686

 
775

 
733

Viagra EH(c)
 
Erectile dysfunction
 
636

 
382

 
383

Vfend
 
Fungal infections
 
392

 
421

 
590

Lyrica EH(b)
 
Epilepsy, neuropathic pain and generalized anxiety disorder
 
347

 
553

 
801

Zyvox
 
Bacterial infections
 
236

 
281

 
421

Revatio
 
Pulmonary arterial hypertension
 
227

 
252

 
285

Pristiq
 
Depression
 
206

 
303

 
732

All other Peri-LOE Products
 
Various
 
213

 
257

 
276

Biosimilars(h)
 
Various
 
$
769

 
$
531

 
$
319

Inflectra/Remsima
 
Inflammatory diseases
 
642

 
419

 
192

All other Biosimilars
 
Various
 
127

 
112

 
127

Pfizer CentreOne(i)
 
 
 
$
755

 
$
706

 
$
718

Hospira Infusion Systems (HIS)(j)
 
Various
 
$
—

 
$
97

 
$
1,158

Total Lyrica(b)
 
Epilepsy, post-herpetic neuralgia and diabetic peripheral neuropathy, fibromyalgia, neuropathic pain due to spinal cord injury
 
$
4,970

 
$
5,065

 
$
4,966

Total Viagra(c)
 
Erectile dysfunction
 
$
636

 
$
1,204

 
$
1,564

Total Alliance revenues
 
Various
 
$
3,838

 
$
2,927

 
$
1,746

(a) 
The IH business encompasses Internal Medicine, Vaccines, Oncology, Inflammation & Immunology, Rare Disease and Consumer Healthcare. Through December 31, 2016, includes Duavive/Duavee and Viviant (recorded in All other Internal Medicine in 2016), which were transferred from Innovative Health to Essential Health effective January 1, 2017 (recorded in All other LEP (EH) beginning January 1, 2017), in order to align these products with our management of the women’s health portfolio within EH.
(b) 
Lyrica revenues from all of Europe, Russia, Turkey, Israel and Central Asia countries are included in Lyrica EH. All other Lyrica revenues are included in Lyrica IH. Total Lyrica revenues represent the aggregate of worldwide revenues from Lyrica IH and Lyrica EH.
(c) 
Viagra lost exclusivity in the U.S. in December 2017. In 2018, revenues for Viagra in the U.S. and Canada, which were reported in IH through 2017, were reported in EH (which reported all other Viagra revenues excluding the U.S. and Canada through 2017). Therefore, in 2018, total Viagra worldwide revenues were reported in EH. Total Viagra revenues in 2017 and 2016 represented the aggregate of worldwide revenues from Viagra IH and Viagra EH.
(d) 
The EH business encompasses Legacy Established Products, Sterile Injectable Pharmaceuticals, Peri-LOE Products, Biosimilars, Pfizer CentreOne and HIS (through February 2, 2017).
(e) 
Legacy Established Products primarily include products that have lost patent protection (excluding Sterile Injectable Pharmaceuticals and Peri-LOE Products). In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
Effective January 1, 2017, All other LEP includes Duavive/Duavee and Viviant, which were transferred from Innovative Health (recorded in All other Internal Medicine (IH) in 2016), in order to align these products with our management of the women’s health portfolio within EH. See note (a) above.
(f) 
Sterile Injectable Pharmaceuticals includes branded and generic injectables (excluding Peri-LOE Products). In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
(g) 
Peri-LOE Products include products that have recently lost or are anticipated to soon lose patent protection. These products primarily include: Lyrica in Europe, Russia, Turkey, Israel and Central Asia; and worldwide revenues for Celebrex, Pristiq, Zyvox, Vfend, Revatio and Inspra; and in 2018, Viagra revenues for all countries (and Viagra revenues for all countries other than the U.S. and Canada in 2017 and 2016), see note (c) above.
(h) 
Biosimilars include Inflectra/Remsima (biosimilar infliximab) in the U.S. and certain international markets, Nivestim (biosimilar filgrastim) in certain European, Asian and Africa/Middle Eastern markets and in the U.S. and Retacrit (biosimilar epoetin zeta) in the U.S. and certain European and Africa/Middle Eastern markets.
(i) 
Pfizer CentreOne includes revenues from our contract manufacturing and active pharmaceutical ingredient sales operation, including sterile injectables contract manufacturing, and revenues related to our manufacturing and supply agreements, including with Zoetis Inc. In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
(j) 
HIS (through February 2, 2017) includes Medication Management Systems products composed of infusion pumps and related software and services, as well as IV Infusion Products, including large volume IV solutions and their associated administration sets.
v3.10.0.1
Subsequent Event
 12 Months Ended
Dec. 31, 2018
Subsequent Events [Abstract]  
Subsequent Event
Subsequent Event

A. Accelerated Share Repurchase Agreement
On February 7, 2019, we entered into an accelerated share repurchase agreement with GS&Co. to repurchase approximately $6.8 billion of our common stock. Pursuant to the terms of the agreement, on February 12, 2019, we paid approximately $6.8 billion to GS&Co. and received an initial delivery of approximately 130 million shares of our common stock from GS&Co., which represented, based on the closing price of our common stock on the NYSE on February 7, 2019, approximately 80% of the notional amount of the accelerated share repurchase agreement. As of February 28, 2019, the common stock received is included in Treasury Stock. At settlement of the agreement, which is expected to occur during or prior to the third quarter of 2019, GS&Co. may be required to deliver additional shares of common stock to us, or, under certain circumstances, we may be required to deliver shares of our common stock or may elect to make a cash payment to GS&Co., with the number of shares to be delivered or the amount of such payment, as well as the final price per share, based on the volume-weighted average price, less a discount, of Pfizer’s common stock during the term of the transaction. This agreement was entered into pursuant to our previously announced share repurchase authorization. After giving effect to the accelerated share repurchase agreement and other share repurchases through February 28, 2019, our remaining share-purchase authorization was approximately $5.3 billion on February 28, 2019.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies (Policies)
 12 Months Ended
Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation
The consolidated financial statements include our parent company and all subsidiaries, and are prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Consolidation
The decision of whether or not to consolidate an entity requires consideration of majority voting interests, as well as effective economic or other control over the entity. Typically, we do not seek control by means other than voting interests. For subsidiaries operating outside the U.S., the financial information is included as of and for the year ended November 30 for each year presented. Pfizer's fiscal year-end for U.S. subsidiaries is as of and for the year ended December 31 for each year presented. Substantially all unremitted earnings of international subsidiaries are free of legal and contractual restrictions. All significant transactions among our businesses have been eliminated.
Adoption of New Accounting Standards in 2018
Adoption of New Accounting Standards in 2018

On January 1, 2018, we adopted eleven new accounting standards. The quantitative impacts on our prior period consolidated financial statements of adopting the following new standards are summarized in the tables within the section titled Impacts to our Consolidated Financial Statements, further below.

Revenues––We adopted a new accounting standard for revenue recognition and changed our revenue recognition policies accordingly. Generally, the previous revenue recognition standards permitted recognition when persuasive evidence of a contract existed, delivery had occurred, and the seller's price to the buyer was fixed or determinable. Under the new standard, revenue is recognized upon transfer of control of the product to our customer in an amount that reflects the consideration we expect to receive in exchange. We adopted the new accounting standard utilizing the modified retrospective method, and, therefore, no adjustments were made to amounts in our prior period financial statements. We recorded the cumulative effect of adopting the standard as an adjustment to increase the opening balance of Retained earnings by $584 million on a pre-tax basis ($450 million after-tax). This amount includes $500 million (pre-tax) related to the timing of recognizing Other (income)/deductions––net primarily for upfront and milestone payments on our collaboration arrangements ($394 million, pre-tax) and, to a lesser extent, product rights and out-licensing arrangements, and $84 million (pre-tax) related to the timing of recognizing Revenues and Cost of sales on certain product shipments. The impact of adoption did not have a material impact to our consolidated statement of income for the year ended December 31, 2018 nor on our consolidated balance sheet as of December 31, 2018. For additional information, see Note 1G and Note 1H.
Financial Assets and Liabilities––The new accounting standard related to the recognition and measurement of financial assets and liabilities makes the following changes to prior guidance and requires:
•
certain equity investments to be measured at fair value with changes in fair value now recognized in net income. However, equity investments that do not have readily determinable fair values may be measured at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer;
•
a qualitative assessment of equity investments without readily determinable fair values to identify impairment; and
•
separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or in the accompanying notes to the financial statements.
We adopted the new accounting standard utilizing the modified retrospective method, and, therefore, no adjustments were made to amounts in our prior period financial statements. We recorded the cumulative effect of adopting the standard as an adjustment to increase the opening balance of Retained earnings by $462 million on a pre-tax basis ($419 million after-tax) related to the net impact of unrealized gains and losses primarily on available-for-sale equity securities, restricted stock and private equity securities. In 2018, we recorded net unrealized gains on equity securities of $477 million, in Other (income)/deductions––net. For additional information, see Note 4 and Note 7.

Presentation of Net Periodic Pension and Postretirement Benefit Cost––We adopted a new accounting standard that requires the net periodic pension and postretirement benefit costs other than the service costs be presented in Other (income)/deductions––net, and that the presentation be applied retrospectively. We adopted the presentation of the net periodic benefit costs other than service costs by reclassifying these costs from Cost of sales, Selling, informational and administrative expenses, Research and development expenses and Restructuring charges and certain acquisition-related costs to Other (income)/deductions––net. We elected to apply the practical expedient as it is impracticable to determine the disaggregation of the cost components for amounts capitalized within Inventories and property, plant and equipment and amortized in each of those periods. We have therefore reclassified the prior period net periodic benefit costs/(credits) disclosed in Note 11 to apply the retrospective presentation for comparative periods.
As of January 1, 2018, only service costs will be included in amounts capitalized in Inventories or property, plant and equipment, while the other components of net periodic benefit costs will be included in Other (income)/deductions––net. For additional information, see Note 4 and Note 11.
Income Tax Accounting––The new guidance removes the prohibition against recognizing current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to a third party, unless the asset transferred is inventory. We adopted the standard utilizing the modified retrospective method, and, therefore, no adjustments were made to amounts in our prior period financial statements. We recorded the cumulative effect of adopting the standard as an adjustment to decrease the opening balance of Retained earnings by $189 million.
Accounting for Hedging Activities––The standard includes the following changes:
•
Permits hedge accounting for risk components in hedging relationships involving nonfinancial risk and interest rate risk;
•
Changes the guidance for designating fair value hedges of interest rate risk and for measuring the change in fair value of the hedged item in fair value hedges of interest rate risk;
•
No longer requires the separate measurement and reporting of hedge ineffectiveness, but requires the income statement presentation of the earnings effect of the hedging instrument with the earnings effect of the hedged item;
•
Permits us to exclude the portion of the change in fair value of a currency swap that is attributable to a cross-currency basis spread from the assessment of hedge effectiveness; and
•
Simplifies hedge effectiveness testing.
We early adopted the new accounting standard on January 1, 2018 on a prospective basis. In 2018, we recorded income of $107 million in Other (income)/deductions––net, whereas this item would have been classified in interest income in prior periods. For additional information, see Note 7F.
Reclassification of Certain Tax Effects from AOCI––We early adopted a new accounting standard that provides guidance on the reclassification of certain tax effects from AOCI. Under the new guidance, we elected to reclassify the stranded tax amounts related to the TCJA from AOCI to Retained earnings. We adopted the new accounting standard utilizing the modified retrospective method, and recorded the cumulative effect of adopting the standard as an adjustment to increase the opening balance of Retained earnings by $495 million, primarily due to the effect of the change in the U.S. Federal corporate tax rate. The impact on other stranded tax amounts related to the application of the TCJA was not material to our consolidated financial statements.
Classification of Certain Transactions in the Statement of Cash Flows––We retrospectively adopted an accounting standard that changed the presentation of certain information in the consolidated statements of cash flows, including the classification of:
•
debt prepayment and extinguishment costs, resulting in an increase in Operating activities––Other adjustments, net and a decrease in Financing activities––Other financing activities, net of $7 million for the year ended December 31, 2018; and
•
accreted interest on the settlement of commercial paper debt instruments, resulting in a decrease in Operating activities––Other adjustments, net, and an increase in Financing activities––Other financing activities, net of $83 million for the year ended December 31, 2018.
The new standard also establishes guidance on the classification of certain cash flows related to contingent consideration in a business acquisition. Cash payments made soon after a business acquisition date will be classified as Investing activities, while payments made thereafter will be classified as Financing activities. Payments made in excess of the amount of the original contingent consideration liability will be classified as Operating activities. The adoption of this guidance did not have a material impact to our consolidated financial statements.
Presentation of Restricted Cash in the Statement of Cash Flows––We adopted, on a retrospective basis, the new accounting standard, which requires that restricted cash and restricted cash equivalents be included with Cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown in the consolidated statements of cash flows. As a result, for the year ended December 31, 2018, $2 million is presented as a decrease in Cash, cash equivalents, restricted cash and restricted cash equivalents.
Definition of a Business––We prospectively adopted the standard for determining whether business development transactions should be accounted for as acquisitions (or disposals) of assets or businesses. If substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset, the transaction will not qualify for treatment as a business. To be considered a business, a set of integrated activities and assets must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs, without regard as to whether a purchaser could replace missing elements. In addition, the definition of the term “output” has been narrowed to make it consistent with the updated revenue recognition guidance. In 2018, there was no impact to our consolidated financial statements from the adoption of this new standard.
Derecognition of Nonfinancial Assets––We prospectively adopted the standard, which applies to the full or partial sale or transfer of nonfinancial assets, including intangible assets, real estate and inventory. The standard provides that the gain or loss is determined by the difference between the consideration received and the carrying value of the asset. In 2018, there was no impact to our consolidated financial statements from the adoption of this new standard.
Accounting for Modifications of Share-Based Payment Awards––We prospectively adopted the standard, which clarifies that certain changes in the terms or conditions of a share-based payment award be accounted for as a modification. There was no impact to our consolidated financial statements from the adoption of this new standard.
Impacts to our Consolidated Financial Statements––The impacts on our prior period consolidated financial statements of adopting the new standards described above are summarized in the following tables:
Adoption of the standard related to pension and postretirement benefit costs impacted our prior period consolidated statements of income as follows:
 
 
2017
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Effect of Change
Higher/(Lower)

 
As Restated

Cost of sales
 
$
11,240

 
$
(12
)
 
$
11,228

Selling, informational and administrative expenses
 
14,784

 
20

 
14,804

Research and development expenses
 
7,657

 
27

 
7,683

Restructuring charges and certain acquisition-related costs
 
487

 
(136
)
 
351

Other (income)/deductions––net
 
1,315

 
101

 
1,416

Income from continuing operations before provision for taxes on income
 
12,305

 
—

 
12,305

 
 
 
 
 
 
 
 
 
2016
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Effect of Change
Higher/(Lower)

 
As Restated

Cost of sales

$
12,329


$
(7
)

$
12,322

Selling, informational and administrative expenses

14,837


7


14,844

Research and development expenses

7,872


20


7,892

Restructuring charges and certain acquisition-related costs

1,724


(159
)

1,565

Other (income)/deductions––net

3,655


139


3,794

Income from continuing operations before provision for taxes on income

8,351


—


8,351

Adoption of the standards impacted our consolidated balance sheet as follows:
 
 
 
 
Effect of New Accounting Standards Higher/(Lower)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported Balance at December 31, 2017

 
Revenues

 
Financial Assets and Liabilities

 
Income Tax Accounting

 
Reclassification of Certain Tax Effects from AOCI

 
Balance at January 1, 2018

Trade accounts receivable
 
$
8,221

 
$
13

 
$
—

 
$
—

 
$
—

 
$
8,234

Inventories
 
7,578

 
(11
)
 
—

 
—

 
—

 
7,567

Current tax assets
 
3,050

 
(11
)
 
—

 
(3
)
 
—

 
3,036

Noncurrent deferred tax assets and other noncurrent tax assets
 
1,855

 
(17
)
 
—

 
—

 
—

 
1,838

Other noncurrent assets
 
3,227

 
—

 
—

 
(204
)
 
—

 
3,023

Other current liabilities
 
11,115

 
(123
)
 
—

 
—

 
—

 
10,992

Noncurrent deferred tax liabilities
 
3,900

 
106

 
—

 
(18
)
 
—

 
3,988

Other noncurrent liabilities
 
6,149

 
(459
)
 
—

 
—

 
—

 
5,690

Retained earnings
 
85,291

 
450

 
419

 
(189
)
 
495

 
86,466

Accumulated other comprehensive loss
 
(9,321
)
 
—

 
(419
)
 
—

 
(495
)
 
(10,235
)
Adoption of the standards related to the classification of certain transactions in the statements of cash flows and the presentation of restricted cash in the statement of cash flows impacted our consolidated statement of cash flows as follows:
 
 
2017
 
 
 
 
Effect of New Accounting Standards Inflow/(Outflow)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Cash Flow Classification

 
Restricted Cash

 
As Restated

Operating Activities
 
 
 
 
 
 
 
 
Other adjustments, net
 
$
50

 
$
294

 
$
—

 
$
344

Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets
 
(31
)
 
—

 
38

 
7

Investing Activities
 
 
 
 
 
 
 
 
Proceeds from redemptions/sales of short-term investments
 
10,307

 
—

 
(5
)
 
10,302

Proceeds from redemptions/sales of long-term investments
 
3,594

 
—

 
(14
)
 
3,579

Other investing activities, net
 
650

 
21

 
—

 
671

Financing Activities
 
 
 
 
 
 
 
 
Principal payments on short-term borrowings
 
(9,990
)
 
43

 
—

 
(9,947
)
Net proceeds from short-term borrowings with original maturities of three months or less
 
1,401

 
20

 
—

 
1,422

Other financing activities, net
 
(233
)
 
(378
)
 
—

 
(611
)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents
 
(1,254
)
 
—

 
19

 
(1,235
)
Cash and cash equivalents and restricted cash and cash equivalents, beginning
 
2,595

 
—

 
70

 
2,666

Cash and cash equivalents and restricted cash and cash equivalents, ending
 
1,342

 
—

 
89

 
1,431

 
 
 
 
 
 
 
 
 
 
 
2016
 
 
 
 
Effect of New Accounting Standards Inflow/(Outflow)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Cash Flow Classification

 
Restricted Cash

 
As Restated

Operating Activities
 
 
 
 
 
 
 
 
Other adjustments, net
 
$
208

 
$
278

 
$
—

 
$
487

Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets
 
(60
)
 
—

 
13

 
(47
)
Investing Activities
 
 
 
 
 
 
 
 
Proceeds from redemptions/sales of short-term investments
 
29,436

 
—

 
(22
)
 
29,414

Proceeds from redemptions/sales of long-term investments
 
11,254

 
—

 
14

 
11,268

Other investing activities, net
 
51

 
28

 
—

 
80

Financing Activities
 
 
 
 
 
 
 
 
Principal payments on short-term borrowings
 
(5,102
)
 
9

 
—

 
(5,093
)
Net (payments on)/proceeds from short-term borrowings with original maturities of three months or less
 
(3,084
)
 
24

 
—

 
(3,060
)
Other financing activities, net
 
(196
)
 
(340
)
 
—

 
(536
)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents
 
(1,046
)
 
—

 
5

 
(1,041
)
Cash and cash equivalents and restricted cash and cash equivalents, beginning
 
3,641

 
—

 
65

 
3,707

Cash and cash equivalents and restricted cash and cash equivalents, ending
 
2,595

 
—

 
70

 
2,666

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheet that sum to the total of the same amounts shown in the consolidated statements of cash flows:
(MILLIONS OF DOLLARS)
 
December 31, 2018

 
December 31,
2017

Cash and cash equivalents
 
$
1,139

 
$
1,342

Restricted cash and cash equivalents in Short-term investments
 
32

 
—

Restricted cash and cash equivalents in Long-term investments
 
55

 
—

Restricted cash and cash equivalents in Other current assets
 
—

 
14

Restricted cash and cash equivalents in Other noncurrent assets
 
—

 
75

Total cash and cash equivalents and restricted cash and cash equivalents shown in the consolidated balance sheets
 
$
1,225

 
$
1,431


Amounts included in restricted cash represent those required to be set aside by a contractual agreement in connection with ongoing litigation or to secure delivery of Pfizer medicines at the agreed upon terms. The restriction will lapse upon the resolution of the litigation or the proper delivery of the medicines.
Estimates and Assumptions
Estimates and Assumptions

In preparing the consolidated financial statements, we use certain estimates and assumptions that affect reported amounts and disclosures, including amounts recorded and disclosed in connection with acquisitions. These estimates and underlying assumptions can impact all elements of our financial statements. For example, in the consolidated statements of income, estimates are used when accounting for deductions from revenues (such as rebates, chargebacks, sales allowances and sales returns), determining the cost of inventory that is sold, allocating cost in the form of depreciation and amortization, and estimating restructuring charges and the impact of contingencies, as well as determining provisions for taxes on income. On the consolidated balance sheets, estimates are used in determining the valuation and recoverability of assets, such as accounts receivable, investments, inventories, deferred tax assets, fixed assets and intangible assets (including acquired IPR&D assets), and estimates are used in determining the reported amounts of liabilities, such as taxes payable, benefit obligations, accruals for contingencies, rebates, chargebacks, sales allowances and sales returns, and restructuring reserves, all of which also impact the consolidated statements of income.

Our estimates are often based on complex judgments and assumptions that we believe to be reasonable, but that can be inherently uncertain and unpredictable. If our estimates and assumptions are not representative of actual outcomes, our results could be materially impacted.

As future events and their effects cannot be determined with precision, our estimates and assumptions may prove to be incomplete or inaccurate, or unanticipated events and circumstances may occur that might cause us to change those estimates and assumptions. We are subject to risks and uncertainties that may cause actual results to differ from estimated amounts, such as changes in the healthcare environment, competition, litigation, legislation and regulations. We regularly evaluate our estimates and assumptions using historical experience and expectations about the future. We adjust our estimates and assumptions when facts and circumstances indicate the need for change.
Acquisitions
Acquisitions

Our consolidated financial statements include the operations of acquired businesses after the completion of the acquisitions. We account for acquired businesses using the acquisition method of accounting, which requires, among other things, that most assets acquired and liabilities assumed be recognized at their estimated fair values as of the acquisition date and that the fair value of acquired IPR&D be recorded on the balance sheet. Transaction costs are expensed as incurred. Any excess of the consideration transferred over the assigned values of the net assets acquired is recorded as goodwill. When we acquire net assets that do not constitute a business, as defined in U.S. GAAP, no goodwill is recognized and acquired IPR&D is expensed.

Contingent consideration in a business combination is included as part of the acquisition cost and is recognized at fair value as of the acquisition date. Fair value is generally estimated by using a probability-weighted discounted cash flow approach. Any liability resulting from contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved. These changes in fair value are recognized in earnings in Other (income)/deductions––net.

Amounts recorded in connection with an acquisition can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.
Fair Value
Fair Value

We are often required to measure certain assets and liabilities at fair value, either upon initial recognition or for subsequent accounting or reporting. For example, we use fair value extensively in the initial recognition of net assets acquired in a business combination, when measuring certain impairment losses and when accounting for and reporting of certain financial instruments. We estimate fair value using an exit price approach, which requires, among other things, that we determine the price that would be received to sell an asset or paid to transfer a liability in an orderly market. The determination of an exit price is considered from the perspective of market participants, considering the highest and best use of non-financial assets and, for liabilities, assuming that the risk of non-performance will be the same before and after the transfer.

When estimating fair value, depending on the nature and complexity of the asset or liability, we may use one or all of the following techniques:
•
Income approach, which is based on the present value of a future stream of net cash flows.
•
Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities.
•
Cost approach, which is based on the cost to acquire or construct comparable assets, less an allowance for functional and/or economic obsolescence.

Our fair value methodologies depend on the following types of inputs:
•
Quoted prices for identical assets or liabilities in active markets (Level 1 inputs).
•
Quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are directly or indirectly observable, or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means (Level 2 inputs).
•
Unobservable inputs that reflect estimates and assumptions (Level 3 inputs).

A single estimate of fair value can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.
Foreign Currency Translation
Foreign Currency Translation

For most of our international operations, local currencies have been determined to be the functional currencies. We translate functional currency assets and liabilities to their U.S. dollar equivalents at exchange rates in effect as of the balance sheet date and we translate functional currency income and expense amounts to their U.S. dollar equivalents at average exchange rates for the period. The U.S. dollar effects that arise from changing translation rates are recorded in Other comprehensive income/(loss). The effects of converting non-functional currency monetary assets and liabilities into the functional currency are recorded in Other (income)/deductions––net. For operations in highly inflationary economies, we translate monetary items at rates in effect as of the balance sheet date, with translation adjustments recorded in Other (income)/deductions––net, and we translate non-monetary items at historical rates.
Revenue and Collaborative Arrangements
Collaborative Arrangements

Payments to and from our collaboration partners are presented in our consolidated statements of income based on the nature of the arrangement (including its contractual terms), the nature of the payments and applicable accounting guidance. Under co-promotion agreements, we record the amounts received from our collaboration partners as alliance revenues, a component of Revenues, when our collaboration partners are the principal in the transaction and we receive a share of their net sales or profits. Alliance revenues are recorded as we perform co-promotion services for the collaboration and the collaboration partners sell the products to their customers within the applicable period. The related expenses for selling and marketing these products are included in Selling, informational and administrative expenses. In collaborative arrangements where we manufacture a product for our collaboration partners, we record revenues when we transfer control of the product to our collaboration partners. In collaboration arrangements where we are the principal in the transaction, we record amounts paid to collaboration partners for their share of net sales or profits earned, and all royalty payments to collaboration partners as Cost of sales. Royalty payments received from collaboration partners are included in Other (income)/deductions—net.
Reimbursements to or from our collaboration partners for development costs are recorded net in Research and development expenses. Upfront payments and pre-approval milestone payments due from us to our collaboration partners in development stage collaborations are recorded as Research and development expenses. Milestone payments due from us to our collaboration partners after regulatory approval has been attained for a medicine are recorded in Identifiable intangible assets—Developed technology rights. Upfront and pre-approval milestone payments earned from our collaboration partners by us are recognized in Other (income)/deductions—net over the development period for the collaboration products, when our performance obligations include providing R&D services to our collaboration partners. Upfront, pre-approval and post-approval milestone payments earned by us may be recognized in Other (income)/deductions—net immediately when earned or over other periods depending upon the nature of our performance obligations in the applicable collaboration. Where the milestone event is regulatory approval for a medicine, we generally recognize milestone payments due to us in the transaction price when regulatory approval in the applicable jurisdiction has been attained. We may recognize milestone payments due to us in the transaction price earlier than the milestone event in certain circumstances when recognition of the income would not be probable of a significant reversal.
Revenues and Trade Accounts Receivable

On January 1, 2018, we adopted a new accounting standard for revenue recognition. For further information, see Note 1B.
We recorded direct product sales and/or alliance revenues of more than $1 billion for each of ten products in 2018 and for each of nine products in 2017 and 2016. In the aggregate, these direct products sales and/or alliance product revenues represent 51% of our revenues in 2018, 46% of our revenues in 2017 and 43% of our revenues in 2016. See Note 18C for additional information. The loss or expiration of intellectual property rights can have a significant adverse effect on our revenues as our contracts with customers will generally be at lower selling prices due to added competition and we generally provide for higher sales returns during the period in which individual markets begin to near the loss or expiration of intellectual property rights. Our Consumer Healthcare business includes OTC brands with a focus on dietary supplements, pain management, gastrointestinal and respiratory and personal care. We sell biopharmaceutical products after patent expiration, and under patent, and, to a much lesser extent, consumer healthcare products worldwide to developed and emerging market countries.
Revenue Recognition––We record revenues from product sales when there is a transfer of control of the product from us to the customer. We determine transfer of control based on when the product is shipped or delivered and title passes to the customer.
•
Customers––Our biopharmaceutical products are sold principally to wholesalers but we also sell directly to retailers, hospitals, clinics, government agencies and pharmacies, and, in the case of our vaccine products in the U.S., we primarily sell directly to the CDC, wholesalers, individual provider offices, retail pharmacies and integrated delivery networks. Our consumer healthcare customers include retailers and, to a lesser extent, wholesalers and distributors.
Biopharmaceutical products that ultimately are used by patients are generally covered under governmental programs, managed care programs and insurance programs, including those managed through pharmacy benefit managers, and are subject to sales allowances and/or rebates payable directly to those programs. Those sales allowances and rebates are generally negotiated, but government programs may have legislated amounts by type of product (e.g., patented or unpatented).
•
Our Sales Contracts––Sales on credit are typically under short-term contracts. Collections are based on market payment cycles common in various markets, with shorter cycles in the U.S. Sales are adjusted for sales allowances, chargebacks, rebates and sales returns and cash discounts. Sales returns occur due to loss of exclusivity, product recalls or a changing competitive environment.
•
Deductions from Revenues––Our gross product revenues are subject to a variety of deductions, which generally are estimated and recorded in the same period that the revenues are recognized. Such variable consideration represents chargebacks, rebates, sales allowances and sales returns. These deductions represent estimates of the related obligations and, as such, knowledge and judgment is required when estimating the impact of these revenue deductions on gross sales for a reporting period.
Specifically:
•
In the U.S., we sell our products to distributors and hospitals under our sales contracts. However, we also have contracts with managed care or pharmacy benefit managers and legislatively mandated contracts with the federal and state governments under which we provide rebates to them based on medicines utilized by the lives they cover. We record provisions for Medicare, Medicaid, and performance-based contract pharmaceutical rebates based upon our experience ratio of rebates paid and actual prescriptions written during prior quarters. We apply the experience ratio to the respective period’s sales to determine the rebate accrual and related expense. This experience ratio is evaluated regularly to ensure that the historical trends are as current as practicable. We estimate discounts on branded prescription drug sales to Medicare Part D participants in the Medicare “coverage gap,” also known as the “doughnut hole,” based on the historical experience of beneficiary prescriptions and consideration of the utilization that is expected to result from the discount in the coverage gap. We evaluate this estimate regularly to ensure that the historical trends and future expectations are as current as practicable. For performance-based contract rebates, we also consider current contract terms, such as changes in formulary status and rebate rates.
•
Outside the U.S., the majority of our pharmaceutical sales allowances are contractual or legislatively mandated and our estimates are based on actual invoiced sales within each period, which reduces the risk of variations in the estimation process. In certain European countries, rebates are calculated on the government’s total unbudgeted pharmaceutical spending or on specific product sales thresholds and we apply an estimated allocation factor against our actual invoiced sales to project the expected level of reimbursement. We obtain third-party information that helps us to monitor the adequacy of these accruals.
•
Provisions for pharmaceutical chargebacks (primarily reimbursements to U.S. wholesalers for honoring contracted prices to third parties) closely approximate actual amounts incurred, as we settle these deductions generally within two to five weeks of incurring the liability.
•
Provisions for pharmaceutical sales returns are based on a calculation for each market that incorporates the following, as appropriate: local returns policies and practices; historical returns as a percentage of sales; an understanding of the reasons for past returns; estimated shelf life by product; an estimate of the amount of time between shipment and return or lag time; and any other factors that could impact the estimate of future returns, such as loss of exclusivity, product recalls or a changing competitive environment. Generally, returned products are destroyed, and customers are refunded the sales price in the form of a credit.
•
We record sales incentives as a reduction of revenues at the time the related revenues are recorded or when the incentive is offered, whichever is later. We estimate the cost of our sales incentives based on our historical experience with similar incentives programs to predict customer behavior.
Amounts recorded for revenue deductions can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions. For information about the risks associated with estimates and assumptions, see Note 1C.

Taxes collected from customers relating to product sales and remitted to governmental authorities are excluded from Revenues.
Trade Accounts Receivable
Trade Accounts Receivable—Trade accounts receivable are stated at their net realizable value. The allowance against gross trade accounts receivable reflects the best estimate of probable losses inherent in the receivables portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other current information. Trade accounts receivable are written off after all reasonable means to collect the full amount (including litigation, where appropriate) have been exhausted.
Cost of Sales and Inventories
Cost of Sales and Inventories

We carry inventories at the lower of cost or net realizable value. The cost of finished goods, work in process and raw materials is determined using average actual cost. We regularly review our inventories for impairment and reserves are established when necessary.
Selling, Informational and Administrative Expenses
Selling, Informational and Administrative Expenses

Selling, informational and administrative costs are expensed as incurred. Among other things, these expenses include the internal and external costs of marketing, advertising, shipping and handling, information technology and legal defense.
Research and Development Expenses
Research and Development Expenses

R&D costs are expensed as incurred. These expenses include the costs of our proprietary R&D efforts, as well as costs incurred in connection with certain licensing arrangements. Before a compound receives regulatory approval, we record upfront and milestone payments made by us to third parties under licensing arrangements as expense. Upfront payments are recorded when incurred, and milestone payments are recorded when the specific milestone has been achieved. Once a compound receives regulatory approval, we record any milestone payments in Identifiable intangible assets, less accumulated amortization and, unless the asset is determined to have an indefinite life, we amortize the payments on a straight-line basis over the remaining agreement term or the expected product life cycle, whichever is shorter.
Property, Plant and Equipment
Property, plant and equipment, less accumulated depreciation—These assets are recorded at cost and are increased by the cost of any significant improvements after purchase. Property, plant and equipment assets, other than land and construction in progress, are depreciated on a straight-line basis over the estimated useful life of the individual assets. Depreciation begins when the asset is ready for its intended use. For tax purposes, accelerated depreciation methods are used as allowed by tax laws.
Intangible Assets and Goodwill
•
Identifiable intangible assets, less accumulated amortization—These acquired assets are recorded at fair value. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives. Intangible assets with indefinite lives that are associated with marketed products are not amortized until a useful life can be determined.
•
Goodwill—Goodwill represents the excess of the consideration transferred for an acquired business over the assigned values of its net assets. Goodwill is not amortized.

Amortization expense related to finite-lived acquired intangible assets that contribute to our ability to sell, manufacture, research, market and distribute products, compounds and intellectual property is included in Amortization of intangible assets as these intangible assets benefit multiple business functions. Amortization expense related to intangible assets that are associated with a single function and depreciation of property, plant and equipment are included in Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses, as appropriate.
Specifically:
•
For finite-lived intangible assets, such as developed technology rights, and for other long-lived assets, such as property, plant and equipment, whenever impairment indicators are present, we calculate the undiscounted value of the projected cash flows associated with the asset, or asset group, and compare this estimated amount to the carrying amount. If the carrying amount is found to be greater, we record an impairment loss for the excess of book value over fair value. In addition, in all cases of an impairment review, we re-evaluate the remaining useful lives of the assets and modify them, as appropriate.
•
For indefinite-lived intangible assets, such as Brands and IPR&D assets, when necessary, we determine the fair value of the asset and record an impairment loss, if any, for the excess of book value over fair value. In addition, in all cases of an impairment review other than for IPR&D assets, we re-evaluate whether continuing to characterize the asset as indefinite-lived is appropriate.
•
For goodwill, when necessary, we determine the fair value of each reporting unit and compare that value to its book value. If the carrying amount is found to be greater, we then determine the implied fair value of goodwill by subtracting the fair value of all the identifiable net assets other than goodwill from the fair value of the reporting unit and record an impairment loss, if any, for the excess of the book value of goodwill over the implied fair value.
Property, Plant and Equipment, Impairment
We review all of our long-lived assets for impairment indicators throughout the year. We perform impairment testing for indefinite-lived intangible assets and goodwill at least annually and for all other long-lived assets whenever impairment indicators are present. When necessary, we record charges for impairments of long-lived assets for the amount by which the fair value is less than the carrying value of these assets.
Restructuring Charges and Certain Acquisition-Related Costs
Restructuring Charges and Certain Acquisition-Related Costs

We may incur restructuring charges in connection with acquisitions when we implement plans to restructure and integrate the acquired operations or in connection with our cost-reduction and productivity initiatives. Included in Restructuring charges and certain acquisition-related costs are all restructuring charges, as well as certain other costs associated with acquiring and integrating an acquired business. If the restructuring action results in a change in the estimated useful life of an asset, that incremental impact is classified in Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses, as appropriate. Termination costs are generally recorded when the actions are probable and estimable. Transaction costs, such as banking, legal, accounting and other similar costs incurred in connection with a business acquisition are expensed as incurred.

Amounts recorded for restructuring charges and other associated costs can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.
Cash Equivalents
Cash equivalents include items almost as liquid as cash, such as certificates of deposit and time deposits with maturity periods of three months or less when purchased. If items meeting this definition are part of a larger investment pool, we classify them as Short-term investments.
Statement of Cash Flows
Cash flows associated with financial instruments designated as fair value or cash flow hedges may be included in operating, investing or financing activities, depending on the classification of the items being hedged. Cash flows associated with financial instruments designated as net investment hedges are classified according to the nature of the hedge instrument. Cash flows associated with financial instruments that do not qualify for hedge accounting treatment are classified according to their purpose and accounting nature.
Investments
Our investments are comprised of the following: trading funds and securities, available-for-sale securities, held-to-maturity securities (when we have both the positive intent and ability to hold the investment to maturity) and private equity securities. The classification of an investment can depend on the nature of the investment, our intent and ability to hold the investment, and the degree to which we may exercise influence.
•
Trading securities are carried at fair value, with changes in fair value reported in Other (income)/deductions—net.
•
Available-for-sale debt securities are carried at fair value, with changes in fair value reported in Other comprehensive income/(loss) until realized.
•
Held-to-maturity debt securities are carried at amortized cost.
•
Private equity securities are carried at equity-method or at cost. For additional information, see Note 1B. For equity investments where we have significant influence over the financial and operating policies of the investee, we use the equity-method of accounting. Under the equity-method, we record our share of the investee’s income and expenses in Other (income)/deductions—net. The excess of the cost of the investment over our share of the equity of the investee as of the acquisition date is allocated to the identifiable assets of the investee, with any remaining excess amount allocated to goodwill. Such investments are initially recorded at cost, which typically does not include amounts of contingent consideration.

Realized gains or losses on sales of investments are determined by using the specific identification cost method.

We regularly evaluate all of our financial assets for impairment. For investments in debt and equity securities, when a decline in fair value, if any, is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis in the investment is established.
Derivative Financial Instruments
Derivative financial instruments are carried at fair value in various balance sheet categories (see Note 7A), with changes in fair value reported in Net income or, for derivative financial instruments in certain qualifying hedging relationships, in Other comprehensive income/(loss) (see Note 7F).

Tax Assets and Liabilities and Income Tax Contingencies
Tax Assets and Liabilities and Income Tax Contingencies

On January 1, 2018, we adopted new accounting standards for income tax accounting as well as reclassification of certain tax effects from AOCI. For further information, see Note 1B.
Current tax assets primarily includes income tax receivables that are expected to be recovered either as refunds from taxing authorities or as a reduction to future tax obligations.

Deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates and laws, including the TCJA enacted in December 2017. We provide a valuation allowance when we believe that our deferred tax assets are not recoverable based on an assessment of estimated future taxable income that incorporates ongoing, prudent and feasible tax-planning strategies, that would be implemented, if necessary, to realize the deferred tax assets. All deferred tax assets and liabilities within the same tax jurisdiction are presented as a net amount in the noncurrent section of our consolidated balance sheet.

Other taxes payable in our consolidated balance sheet as of December 31, 2018 includes liabilities for uncertain tax positions and the noncurrent portion of the repatriation tax liability on the deemed repatriated accumulated post-1986 foreign earnings recorded in connection with the TCJA for which we plan to elect, with the filing of our 2018 U.S. Federal Consolidated Income Tax Return, payment over eight years through 2026. See Note 5A for additional information.

We account for income tax contingencies using a benefit recognition model. If we consider that a tax position is more likely than not to be sustained upon audit, based solely on the technical merits of the position, we recognize the benefit. We measure the benefit by determining the amount that is greater than 50% likely of being realized upon settlement, presuming that the tax position is examined by the appropriate taxing authority that has full knowledge of all relevant information.

Under the benefit recognition model, if our initial assessment fails to result in the recognition of a tax benefit, we regularly monitor our position and subsequently recognize the tax benefit: (i) if there are changes in tax law, analogous case law or there is new information that sufficiently raise the likelihood of prevailing on the technical merits of the position to “more likely than not”; (ii) if the statute of limitations expires; or (iii) if there is a completion of an audit resulting in a favorable settlement of that tax year with the appropriate agency. We regularly re-evaluate our tax positions based on the results of audits of federal, state and local and foreign income tax filings, statute of limitations expirations, changes and clarification in tax law or receipt of new information that would either increase or decrease the technical merits of a position relative to the more-likely-than-not standard. Liabilities associated with uncertain tax positions are classified as current only when we expect to pay cash within the next 12 months. Interest and penalties, if any, are recorded in Provision/(benefit) for taxes on income and are classified on our consolidated balance sheet with the related tax liability.

Amounts recorded for valuation allowances and income tax contingencies can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.
Pension and Postretirement Benefit Plans
Pension and Postretirement Benefit Plans

On January 1, 2018, we adopted a new accounting standard for the presentation of net periodic pension and postretirement benefit cost. For further information, see Note 1B.
The majority of our employees worldwide are covered by defined benefit pension plans, defined contribution plans or both. In the U.S., we have both IRC-qualified and supplemental (non-qualified) defined benefit plans and defined contribution plans, as well as other postretirement benefit plans consisting primarily of medical insurance for retirees and their eligible dependents. We recognize the overfunded or underfunded status of each of our defined benefit plans as an asset or liability on our consolidated balance sheet. The obligations are generally measured at the actuarial present value of all benefits attributable to employee service rendered, as provided by the applicable benefit formula. Our pension and other postretirement obligations may include assumptions such as expected employee turnover and participant mortality. For our pension plans, the obligation may also include assumptions as to future compensation levels. For our other postretirement benefit plans, the obligation may include assumptions as to the expected cost of providing medical insurance benefits, as well as the extent to which those costs are shared with the employee or others (such as governmental programs). Plan assets are measured at fair value. Net periodic pension and postretirement benefit costs other than the service costs are recognized in Other (income)/deductions—net.

Amounts recorded for pension and postretirement benefit plans can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.
Legal and Environmental Contingencies
Legal and Environmental Contingencies

We and certain of our subsidiaries are subject to numerous contingencies arising in the ordinary course of business, such as patent litigation, product liability and other product-related litigation, commercial litigation, environmental claims and proceedings, government investigations and guarantees and indemnifications. We record accruals for these contingencies to the extent that we conclude that a loss is both probable and reasonably estimable. If some amount within a range of loss appears to be a better estimate than any other amount within the range, we accrue that amount. Alternatively, when no amount within a range of loss appears to be a better estimate than any other amount, we accrue the lowest amount in the range. We record anticipated recoveries under existing insurance contracts when recovery is assured.
Amounts recorded for contingencies can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.
Share-Based Payments
Share-Based Payments

Our compensation programs can include share-based payments. Generally, grants under share-based payment programs are accounted for at fair value and these fair values are generally amortized on a straight-line basis over the vesting terms into Cost of sales, Selling, informational and administrative expenses and/or Research and development expenses, as appropriate.

Amounts recorded for share-based compensation can result from a complex series of judgments about future events and uncertainties and can rely heavily on estimates and assumptions.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies (Tables)
 12 Months Ended
Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Impact of Adoption of Accounting Standard Updates
The impacts on our prior period consolidated financial statements of adopting the new standards described above are summarized in the following tables:
Adoption of the standard related to pension and postretirement benefit costs impacted our prior period consolidated statements of income as follows:
 
 
2017
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Effect of Change
Higher/(Lower)

 
As Restated

Cost of sales
 
$
11,240

 
$
(12
)
 
$
11,228

Selling, informational and administrative expenses
 
14,784

 
20

 
14,804

Research and development expenses
 
7,657

 
27

 
7,683

Restructuring charges and certain acquisition-related costs
 
487

 
(136
)
 
351

Other (income)/deductions––net
 
1,315

 
101

 
1,416

Income from continuing operations before provision for taxes on income
 
12,305

 
—

 
12,305

 
 
 
 
 
 
 
 
 
2016
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Effect of Change
Higher/(Lower)

 
As Restated

Cost of sales

$
12,329


$
(7
)

$
12,322

Selling, informational and administrative expenses

14,837


7


14,844

Research and development expenses

7,872


20


7,892

Restructuring charges and certain acquisition-related costs

1,724


(159
)

1,565

Other (income)/deductions––net

3,655


139


3,794

Income from continuing operations before provision for taxes on income

8,351


—


8,351

Adoption of the standards impacted our consolidated balance sheet as follows:
 
 
 
 
Effect of New Accounting Standards Higher/(Lower)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported Balance at December 31, 2017

 
Revenues

 
Financial Assets and Liabilities

 
Income Tax Accounting

 
Reclassification of Certain Tax Effects from AOCI

 
Balance at January 1, 2018

Trade accounts receivable
 
$
8,221

 
$
13

 
$
—

 
$
—

 
$
—

 
$
8,234

Inventories
 
7,578

 
(11
)
 
—

 
—

 
—

 
7,567

Current tax assets
 
3,050

 
(11
)
 
—

 
(3
)
 
—

 
3,036

Noncurrent deferred tax assets and other noncurrent tax assets
 
1,855

 
(17
)
 
—

 
—

 
—

 
1,838

Other noncurrent assets
 
3,227

 
—

 
—

 
(204
)
 
—

 
3,023

Other current liabilities
 
11,115

 
(123
)
 
—

 
—

 
—

 
10,992

Noncurrent deferred tax liabilities
 
3,900

 
106

 
—

 
(18
)
 
—

 
3,988

Other noncurrent liabilities
 
6,149

 
(459
)
 
—

 
—

 
—

 
5,690

Retained earnings
 
85,291

 
450

 
419

 
(189
)
 
495

 
86,466

Accumulated other comprehensive loss
 
(9,321
)
 
—

 
(419
)
 
—

 
(495
)
 
(10,235
)
Adoption of the standards related to the classification of certain transactions in the statements of cash flows and the presentation of restricted cash in the statement of cash flows impacted our consolidated statement of cash flows as follows:
 
 
2017
 
 
 
 
Effect of New Accounting Standards Inflow/(Outflow)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Cash Flow Classification

 
Restricted Cash

 
As Restated

Operating Activities
 
 
 
 
 
 
 
 
Other adjustments, net
 
$
50

 
$
294

 
$
—

 
$
344

Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets
 
(31
)
 
—

 
38

 
7

Investing Activities
 
 
 
 
 
 
 
 
Proceeds from redemptions/sales of short-term investments
 
10,307

 
—

 
(5
)
 
10,302

Proceeds from redemptions/sales of long-term investments
 
3,594

 
—

 
(14
)
 
3,579

Other investing activities, net
 
650

 
21

 
—

 
671

Financing Activities
 
 
 
 
 
 
 
 
Principal payments on short-term borrowings
 
(9,990
)
 
43

 
—

 
(9,947
)
Net proceeds from short-term borrowings with original maturities of three months or less
 
1,401

 
20

 
—

 
1,422

Other financing activities, net
 
(233
)
 
(378
)
 
—

 
(611
)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents
 
(1,254
)
 
—

 
19

 
(1,235
)
Cash and cash equivalents and restricted cash and cash equivalents, beginning
 
2,595

 
—

 
70

 
2,666

Cash and cash equivalents and restricted cash and cash equivalents, ending
 
1,342

 
—

 
89

 
1,431

 
 
 
 
 
 
 
 
 
 
 
2016
 
 
 
 
Effect of New Accounting Standards Inflow/(Outflow)
 
 
(MILLIONS OF DOLLARS)
 
As Previously Reported

 
Cash Flow Classification

 
Restricted Cash

 
As Restated

Operating Activities
 
 
 
 
 
 
 
 
Other adjustments, net
 
$
208

 
$
278

 
$
—

 
$
487

Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets
 
(60
)
 
—

 
13

 
(47
)
Investing Activities
 
 
 
 
 
 
 
 
Proceeds from redemptions/sales of short-term investments
 
29,436

 
—

 
(22
)
 
29,414

Proceeds from redemptions/sales of long-term investments
 
11,254

 
—

 
14

 
11,268

Other investing activities, net
 
51

 
28

 
—

 
80

Financing Activities
 
 
 
 
 
 
 
 
Principal payments on short-term borrowings
 
(5,102
)
 
9

 
—

 
(5,093
)
Net (payments on)/proceeds from short-term borrowings with original maturities of three months or less
 
(3,084
)
 
24

 
—

 
(3,060
)
Other financing activities, net
 
(196
)
 
(340
)
 
—

 
(536
)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents
 
(1,046
)
 
—

 
5

 
(1,041
)
Cash and cash equivalents and restricted cash and cash equivalents, beginning
 
3,641

 
—

 
65

 
3,707

Cash and cash equivalents and restricted cash and cash equivalents, ending
 
2,595

 
—

 
70

 
2,666
Reconciliation of Cash, Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheet that sum to the total of the same amounts shown in the consolidated statements of cash flows:
(MILLIONS OF DOLLARS)
 
December 31, 2018

 
December 31,
2017

Cash and cash equivalents
 
$
1,139

 
$
1,342

Restricted cash and cash equivalents in Short-term investments
 
32

 
—

Restricted cash and cash equivalents in Long-term investments
 
55

 
—

Restricted cash and cash equivalents in Other current assets
 
—

 
14

Restricted cash and cash equivalents in Other noncurrent assets
 
—

 
75

Total cash and cash equivalents and restricted cash and cash equivalents shown in the consolidated balance sheets
 
$
1,225

 
$
1,431
Information About Balance Sheet Classification of Accruals
The following table provides information about the balance sheet classification of these accruals:
  
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Reserve against Trade accounts receivable, less allowance for doubtful accounts
 
$
1,288

 
$
1,352

 
 
 
 
 
Other current liabilities:
 
 
 
 
Accrued rebates
 
3,208

 
2,674

Other accruals
 
531

 
512

 
 
 
 
 
Other noncurrent liabilities
 
399

 
385

Total accrued rebates and other accruals
 
$
5,426

 
$
4,923
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment (Tables)
 12 Months Ended
Dec. 31, 2018
Business Combinations, Discontinued Operations And Disposal Groups, Collaborative Arrangements And Equity Method Investments [Abstract]  
Summary of Assets and Liabilities Held For Sale
The amounts associated with the Consumer Healthcare business, as well as other assets classified as held for sale consisted of the following:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Assets Held for Sale
 
 
 
 
Cash and cash equivalents
 
$
32

 
$
—

Trade accounts receivable, less allowance for doubtful accounts
 
532

 
—

Inventories
 
538

 
—

Other current assets
 
56

 
—

PP&E
 
675

 
—

Identifiable intangible assets, less accumulated amortization
 
5,763

 
—

Goodwill
 
1,972

 
—

Noncurrent deferred tax assets and other noncurrent tax assets
 
54

 
—

Other noncurrent assets
 
57

 
—

Total Consumer assets held for sale
 
9,678

 
—

Other assets held for sale(a)
 
46

 
12

Assets held for sale
 
$
9,725

 
$
12

 
 
 
 
 
Liabilities Held for Sale
 
 
 
 
 
 
 
 
 
Trade accounts payable
 
$
406

 
$
—

Income taxes payable
 
39

 
—

Accrued compensation and related items
 
93

 
—

Other current liabilities
 
353

 
—

Pension benefit obligations, net
 
39

 
—

Postretirement benefit obligations, net
 
33

 
—

Noncurrent deferred tax liabilities
 
870

 
—

Other noncurrent liabilities
 
56

 
—

Total Consumer liabilities held for sale
 
$
1,890

 
$
—

(a) 
Other assets held for sale consist of PP&E.
Schedule of Collaborative Arrangements and Non-collaborative Arrangement Transactions
The following table provides the amounts and classification of payments (income/(expense)) between us and our collaboration partners:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Revenues—Revenues(a)
 
$
571

 
$
606

 
$
659

Revenues—Alliance revenues(b)
 
3,838

 
2,927

 
1,746

Total revenues from collaborative arrangements
 
4,409

 
3,533

 
2,405

Cost of sales(c)
 
(296
)
 
(329
)
 
(315
)
Selling, informational and administrative expenses(d)
 
(90
)
 
(54
)
 
(5
)
Research and development expenses(e)
 
162

 
222

 
64

Other income/(deductions)—net(f)
 
281

 
249

 
542

(a) 
Represents sales to our partners of products manufactured by us.
(b) 
Substantially all relates to amounts earned from our partners under co-promotion agreements. The increases in 2018 and 2017 reflect increases in alliance revenues from Eliquis and Xtandi.
(c) 
Primarily relates to amounts paid to collaboration partners for their share of net sales or profits earned in collaboration arrangements where we are the principal in the transaction, and cost of sales associated with inventory purchased from our partners.
(d) 
Represents net reimbursements to our partners for selling, informational and administrative expenses incurred.
(e) 
Primarily relates to upfront payments and pre-approval milestone payments earned by our partners as well as net reimbursements. The upfront and milestone payments were as follows: $50 million in 2018, $15 million in 2017 and $15 million in 2016. Our collaboration with Lilly (see below) also includes reimbursements of $98 million in 2018, $147 million in 2017 and $120 million in 2016.
(f) 
Primarily relates to royalties from our collaboration partners. The decrease in 2017 is due to the October 31, 2016 expiration of our 36 month royalty arrangement on sales of Enbrel in the U.S. and Canada, partially offset by a full year of royalties earned in 2017, versus a partial year in 2016, on Xtandi ex-U.S. sales.
v3.10.0.1
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives (Tables)
 12 Months Ended
Dec. 31, 2018
Restructuring and Related Activities [Abstract]  
Schedule Providing Components of Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives
The following table provides the components of costs associated with acquisitions and cost-reduction/productivity initiatives:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Restructuring charges/(credits):
 
 
 
 
 
 
Employee terminations
 
$
459

 
$
(181
)
 
$
839

Asset impairments(a)
 
290

 
190

 
142

Exit costs
 
33

 
21

 
74

Total restructuring charges(b)
 
782

 
30

 
1,055

Transaction costs(c)
 
1

 
4

 
127

Integration costs(d)
 
260

 
317

 
383

Restructuring charges and certain acquisition-related costs
 
1,044

 
351

 
1,565

Net periodic benefit costs recorded in Other (income)/deductions––net(e)
 
146

 
136

 
159

Additional depreciation––asset restructuring, virtually all of which is recorded in Cost of sales(f)
 
50

 
91

 
207

Implementation costs recorded in our consolidated statements of income as follows(g):
 
 
 
 
 
 
Cost of sales
 
83

 
118

 
230

Selling, informational and administrative expenses
 
72

 
71

 
81

Research and development expenses
 
39

 
38

 
25

Other (income)/deductions––net
 
—

 
—

 
3

Total implementation costs
 
194

 
227

 
340

Total costs associated with acquisitions and cost-reduction/productivity initiatives
 
$
1,434

 
$
805

 
$
2,271

(a) 
The asset impairment charges for 2018 are largely associated with cost reduction initiatives not associated with acquisitions. The asset impairment charges for 2017 are largely associated with our acquisitions of Hospira and Medivation. The asset impairment charges included in restructuring charges for 2017 and 2016 are primarily associated with abandoned assets. See (b) below for additional information.
(b) 
In 2018, restructuring charges were primarily related to employee termination costs and asset write downs. The employee termination costs are associated with our improvements to operational effectiveness as part of the realignment of our organizational structure effective at the beginning of 2019. In 2017, restructuring charges are primarily associated with our acquisitions of Hospira and Medivation, partially offset by credits associated with cost-reduction and productivity initiatives not associated with acquisitions that mostly related to the reversal of previously recorded accruals for employee termination costs resulting from revisions of our severance benefit estimates. In 2016, restructuring charges are largely associated with cost-reduction and productivity initiatives not associated with acquisitions, as well as our acquisitions of Hospira and Medivation. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.
The restructuring activities in 2018 are associated with the following:
•
IH ($176 million charge); EH ($31 million charge); WRD/GPD ($135 million charge); manufacturing operations ($403 million charge); and Corporate ($38 million charge).
The restructuring activities in 2017 are associated with the following:
•
IH ($83 million credit); EH ($6 million credit); WRD/GPD ($19 million charge); manufacturing operations ($89 million charge); and Corporate ($12 million charge),
The restructuring activities in 2016 are associated with the following:
•
IH ($255 million charge); EH ($155 million charge); WRD/GPD ($145 million charge); manufacturing operations ($328 million charge); and Corporate ($172 million charge).
(c) 
Transaction costs represent external costs for banking, legal, accounting and other similar services, which in 2017 were directly related to our acquisitions of Hospira, Anacor and Medivation.Transaction costs in 2016 were mostly related to our acquisitions of Medivation and Anacor, and the terminated transaction with Allergan.
(d) 
Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes. In 2018, integration costs were primarily related to our acquisition of Hospira. In 2017, integration costs primarily related to our acquisitions of Hospira and Medivation, as well as a net gain of $12 million related to the settlement of the Hospira U.S. qualified defined benefit pension plan (see Note 11). In 2016, integration costs primarily related to our acquisition of Hospira and the terminated transaction with Allergan.
(e) 
In 2018, primarily represents the net pension curtailments and settlements included in Other (income)/deductions––net upon the adoption of a new accounting standard in the first quarter of 2018. In 2017, primarily represents the net pension curtailments and settlements, partially offset by net periodic benefit credits, excluding service costs, related to our acquisition of Hospira, both of which were reclassified to Other (income)/deductions––net as a result of the retrospective adoption of a new accounting standard in the first quarter of 2018. These credits included a net settlement gain, partially offset by accelerated amortization of actuarial losses and prior service costs upon the settlement of the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. In 2016, primarily represents the net pension curtailments and settlements as well as the accelerated amortization of unrecognized loss and prior service costs related to our acquisition of Hospira, which were reclassified to Other (income)/deductions––net as a result of the retrospective adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 1B and Note 11.
(f) 
Additional depreciation––asset restructuring represents the impact of changes in the estimated useful lives of assets involved in restructuring actions.
(g) 
Implementation costs represent external, incremental costs directly related to implementing our non-acquisition-related cost-reduction/productivity initiatives.
Schedule of Restructuring Reserve by Type of Cost
The following table provides the components of and changes in our restructuring accruals:
(MILLIONS OF DOLLARS)
 
Employee
Termination
Costs

 
Asset
Impairment
Charges

 
Exit Costs

 
Accrual

Balance, January 1, 2017
 
$
1,547

 
$
—

 
$
36

 
$
1,583

Provision/(Credit)
 
(181
)
 
190

 
21

 
30

Utilization and other(a)
 
(326
)
 
(190
)
 
9

 
(508
)
Balance, December 31, 2017(b)
 
1,039

 
—

 
66

 
1,105

Provision
 
459

 
290

 
33

 
782

Utilization and other(a)
 
(295
)
 
(290
)
 
(51
)
 
(636
)
Balance, December 31, 2018(c)
 
$
1,203

 
$
—

 
$
49

 
$
1,252

(a) 
Includes adjustments for foreign currency translation.
(b) 
Included in Other current liabilities ($643 million) and Other noncurrent liabilities ($462 million).
(c) 
Included in Other current liabilities ($823 million) and Other noncurrent liabilities ($428 million).
v3.10.0.1
Other (Income)/Deductions - Net (Tables)
 12 Months Ended
Dec. 31, 2018
Other Income and Expenses [Abstract]  
Schedule of Other Nonoperating Income (Expense)
The following table provides components of Other (income)/deductions––net:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Interest income(a)
 
$
(333
)
 
$
(391
)
 
$
(470
)
Interest expense(a)
 
1,316

 
1,270

 
1,186

Net interest expense
 
983

 
879

 
716

Royalty-related income(b)
 
(495
)
 
(499
)
 
(905
)
Net (gains)/losses on asset disposals(c)
 
(71
)
 
45

 
(51
)
Net gains recognized during the period on investments in equity securities(d)
 
(586
)
 
(224
)
 
(18
)
Net realized (gains)/losses on sales of investments in debt securities(e)
 
141

 
(45
)
 
(35
)
Income from collaborations, out-licensing arrangements and sales of compound/product rights(f)
 
(488
)
 
(217
)
 
(108
)
Net periodic benefit costs/(credits) other than service costs(g)
 
(288
)
 
101

 
139

Certain legal matters, net(h)
 
157

 
240

 
510

Certain asset impairments(i)
 
3,115

 
395

 
1,447

Loss on sale and impairment on remeasurement of HIS net assets(j)
 
(1
)
 
55

 
1,712

Business and legal entity alignment costs(k)
 
4

 
71

 
261

Net losses on early retirement of debt(l)
 
3

 
999

 
312

Other, net(m)
 
(357
)
 
(383
)
 
(186
)
Other (income)/deductions––net
 
$
2,116

 
$
1,416

 
$
3,794

(a) 
2018 v. 2017––Interest income decreased primarily driven by a lower investment balance. Interest expense increased primarily as a result of higher short-term interest rates, offset, in part, by refinancing activity that occurred in the fourth quarter of 2017. 2017 v. 2016––Interest income decreased primarily driven by a lower investment balance. Interest expense increased, primarily as a result of higher short-term interest rates, offset, in part, by the retirement of high-coupon debt and the issuance of new low-coupon debt. Capitalized interest expense totaled $73 million in 2018, $72 million in 2017 and $61 million in 2016.
(b) 
Royalty-related income decreased in 2017, primarily due to lower royalty income for Enbrel of $470 million in 2017, compared to 2016, resulting from the expiration on October 31, 2016 of the 36-month royalty period under the collaboration agreement for Enbrel in the U.S. and Canada (the collaboration period under the agreement expired on October 31, 2013), partially offset by increases in Xtandi royalty-related income of $176 million in 2017, compared to 2016.
(c) 
In 2018, primarily includes a realized gain on sale of property of $60 million. In 2017, primarily includes an $81 million realized loss related to the sale of our then 49%-owned equity-method investment in Hisun Pfizer and a realized net loss of $30 million related to the sale of our 40% ownership investment in Teuto, including the extinguishment of a put option for the then remaining 60% ownership interest, partially offset by a realized gain on sale of property of $52 million. In 2016, primarily includes realized gains on sales of property and other assets.
(d) 
The net gains on investments in equity securities in 2018, include unrealized net gains on equity securities of $477 million, reflecting the adoption of a new accounting standard in the first quarter of 2018. Net gains in 2018 were primarily driven by unrealized gains of $466 million related to our investment in Allogene. Prior to the adoption of a new accounting standard in the first quarter of 2018, net unrealized gains and losses on virtually all equity securities with readily determinable fair values were reported in Accumulated other comprehensive income. For additional information, see Note 1B, Note 2B and Note 7B.
(e) 
In 2018, primarily includes gross realized losses on sales of available-for-sale debt securities of $402 million and a net loss of $18 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities, partially offset by gross realized gains on sales of available-for-sale debt securities of $280 million. Proceeds from the sale of available-for-sale debt securities were $5.7 billion in 2018.
In 2017, primarily includes gross realized gains on sales of available-for-sale debt securities of $451 million, partially offset by gross realized losses on sales of available-for-sale debt securities of $281 million and a net loss of $120 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities. Proceeds from the sale of available-for-sale debt securities were $5.1 billion in 2017.
In 2016, primarily includes gross realized gains on sales of available-for-sale debt securities of $666 million, partially offset by gross realized losses on sales of available-for-sale debt securities of $548 million and a net loss of $64 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities. Proceeds from the sale of available-for-sale debt securities were $10.2 billion in 2016.
(f) 
Includes income from upfront and milestone payments from our collaboration partners and income from out-licensing arrangements and sales of compound/product rights. In 2018, primarily includes, among other things, (i) approximately $118 million in milestone income from multiple licensees, (ii) $110 million in milestone payments received from Shire, of which $75 million was received in the first quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of ulcerative colitis and $35 million was received from Shire in the third quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of Crohn’s disease, (iii) an upfront payment to us and a recognized milestone totaling $85 million for the sale of an AMPA receptor potentiator for CIAS to Biogen, (iv) $62 million in gains related to sales of compound/product rights and (v) a $40 million milestone payment from Merck in conjunction with the approval of ertugliflozin in the EU. For additional information, see Note 2B, Note 2C, Note 2D and Note 2E. In 2017, primarily includes, among other things, $101 million in milestone payments received from multiple licensees and an $85 million gain related to sales of compound/product rights. In 2016, primarily includes, among other things, a $50 million gain related to sales of compound/product rights and $33 million in milestone payments received from multiple licensees.
(g) 
Represents the net periodic benefit costs/(credits), excluding service costs, as a result of the adoption of a new accounting standard in the first quarter of 2018. Effective January 1, 2018, the U.S. Pfizer Consolidated Pension Plan was frozen to future benefit accruals and for 2018, resulted in the recognition of lower net periodic benefit costs due to the extension of the amortization period for the actuarial losses. There was also a greater than expected gain on plan assets due to a higher plan asset base compared to 2017. For additional information, see Note 1B and Note 11.
(h) 
In 2018, primarily includes legal reserves for certain pending legal matters, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In 2017, primarily includes a $94 million charge to resolve a class action lawsuit filed by direct purchasers relating to Celebrex, which was approved by the court in April 2018, and a $79 million charge to reflect damages awarded by a jury in a patent matter. In 2016, primarily includes amounts to resolve a Multi-District Litigation relating to Celebrex and Bextra pending against the Company in New York federal court for $486 million, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In addition, 2016 includes a settlement related to a patent matter.
(i) 
In 2018, primarily includes intangible asset impairment charges of $3.1 billion, mainly composed of (i) $2.6 billion related to EH developed technology rights, $242 million related to EH licensing agreements and $80 million related to EH IPR&D, all of which relate to our acquisition of Hospira, for generic sterile injectable products associated with various indications; (ii) $117 million related to a multi-antigen vaccine IPR&D program for adults undergoing elective spinal fusion surgery; (iii) $31 million related to an IH developed technology right, acquired in connection with our acquisition of Anacor, for the treatment for toenail fungus market marketed in the U.S. market only; and (iv) $17 million of other IPR&D assets acquired in connection with our acquisition of Innopharma. In 2018, the intangible asset impairment charges associated with the generic sterile injectable products reflect, among other things, updated commercial forecasts, reflecting an increased competitive environment as well as higher manufacturing costs, largely stemming from ongoing manufacturing and supply issues. The intangible asset impairment charge for the multi-antigen vaccine IPR&D program was the result of the Phase 2b trial reaching futility at a pre-planned interim analysis. The intangible asset impairment charge related to the IH developed technology right reflects, among other things, updated commercial forecasts. In addition, 2018 includes other asset impairments of $13 million.
In 2017, primarily includes intangible asset impairment charges of $337 million, reflecting (i) $127 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a generic sterile injectable product for the treatment of edema associated with certain conditions; (ii) $124 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a sterile injectable pain reliever; (iii) $39 million related to developed technology rights, acquired in connection with our acquisition of NextWave, for the treatment of attention deficit hyperactivity disorder; (iv) $26 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a generic injectable antibiotic product for the treatment of bacterial infections; and (v) $20 million related to other developed technology rights. The intangible asset impairment charges for 2017 are associated with EH and reflect, among other things, updated commercial forecasts and an increased competitive environment. In addition, 2017 includes a loss of $43 million for an impairment of our AM-Pharma B.V. long-term investment (see Note 2G).
In 2016, primarily includes intangible asset impairment charges of $869 million, reflecting (i) $366 million related to developed technology rights for a generic injectable antibiotic product for the treatment of bacterial infections; and (ii) $265 million related to an IPR&D compound for the treatment of anemia, both acquired in connection with our acquisition of Hospira; (iii) $128 million of sterile injectable IPR&D compounds acquired in connection with our acquisition of InnoPharma; and (iv) $110 million of other IPR&D assets, $81 million of which were acquired in connection with our acquisition of Hospira and $29 million of which were acquired in connection with our acquisition of King in 2011. The intangible asset impairment charges for 2016 are associated with the following: EH ($840 million) and IH ($29 million). In addition, 2016 includes an impairment loss of $452 million related to Pfizer’s then 49%-owned equity-method investment with Hisun in China, Hisun Pfizer, and an impairment loss of $50 million related to Pfizer's 40%-owned equity-method investment in Teuto. For additional information concerning Hisun Pfizer and Teuto, see Note 2F.
The intangible asset impairment charge for 2016 for the IPR&D compound for the treatment of anemia acquired in connection with our acquisition of Hospira reflects, among other things, the impact of regulatory delays, including delays resulting from a then recent court ruling, requiring a 180-day waiting period after approval before a biosimilar product can be launched. The intangible asset impairment charges for 2016 for the sterile injectable IPR&D compounds acquired in connection with our acquisition of InnoPharma reflect, among other things, the impact of portfolio prioritization decisions and decreased commercial profiles of certain compounds. The intangible asset impairment charges for 2016 for developed technology rights and other IPR&D assets acquired in connection with our acquisition of Hospira reflect, among other things, the impact of regulatory delays, the impact of new scientific findings, updated commercial forecasts, changes in pricing, and an increased competitive environment. The intangible asset impairment charges for 2016 for other IPR&D assets acquired in connection with our acquisition of King reflect changes in the competitive environment.
(j) 
In 2018 and 2017, represents adjustments to amounts previously recorded in 2016 to write down the HIS net assets to fair value less costs to sell related to the sale of HIS net assets to ICU Medical on February 3, 2017. In 2016, represents a charge related to the write-down of the HIS net assets to fair value less estimated costs to sell. See Note 2B for additional information.
(k) 
Represents expenses for changes to our infrastructure to align our commercial operations that existed through December 31, 2018, including costs to internally separate our businesses into distinct legal entities, as well as to streamline our intercompany supply operations to better support each business.
(l) 
In 2017 and 2016, represents net losses due to the early retirement of debt, inclusive of the related termination of cross currency swaps in 2017 and inclusive of the related termination of interest rate swaps in 2016.
(m) 
In 2018, includes (i) a non-cash $343 million pre-tax gain associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system (see Note 2B), (ii) dividend income of $253 million from our investment in ViiV, (iii) a non-cash $50 million pre-tax gain on the contribution of Pfizer’s allogeneic CAR T therapy development program assets obtained from Cellectis and Servier in connection with our contribution agreement entered into with Allogene in which Pfizer obtained a 25% ownership stake in Allogene (see Note 2B), and (iv) a non-cash $17 million pre-tax gain on the cash settlement of a liability that we incurred in April 2018 upon the EU approval of Mylotarg (see Note 7E), partially offset by charges of $207 million, reflecting the change in the fair value of contingent consideration and $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily include consulting, legal, tax, and advisory services. In 2017, includes, among other things, dividend income of $266 million from our investment in ViiV, and income of $62 million from resolution of a contract disagreement. In 2016, includes among other things, $150 million paid to Allergan for reimbursement of Allergan’s expenses associated with the terminated transaction (see Note 1A); and income of $116 million from resolution of a contract disagreement.
Schedule of Additional Information About Intangible Assets Impaired
The following table provides additional information about the intangible assets that were impaired during 2018 in Other (income)/deductions––net:
 
 
 
 
Year Ended December 31,

 
 
Fair Value(a)
 
2018

(MILLIONS OF DOLLARS)
 
Amount

 
Level 1

 
Level 2

 
Level 3

 
Impairment

Intangible assets––Developed technology rights(b)
 
$
665

 
$
—

 
$
—

 
$
665

 
$
2,647

Intangible assets––Licensing agreements and other(b)
 
150

 
—

 
—

 
150

 
242

Intangible assets––IPR&D(b)
 
95


—


—


95


214

Total
 
$
910

 
$
—

 
$
—

 
$
910

 
$
3,103

(a) 
The fair value amount is presented as of the date of impairment, as these assets are not measured at fair value on a recurring basis. See also Note 1E.
(b) 
Reflects intangible assets written down to fair value in 2018. Fair value was determined using the income approach, specifically the multi-period excess earnings method, also known as the discounted cash flow method. We started with a forecast of all the expected net cash flows associated with the asset and then applied an asset-specific discount rate to arrive at a net present value amount. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the product; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.
v3.10.0.1
Tax Matters (Tables)
 12 Months Ended
Dec. 31, 2018
Income Tax Disclosure [Abstract]  
Schedule of Income before Income Tax, Domestic and Foreign
The following table provides the components of Income from continuing operations before provision/(benefit) for taxes on income:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

United States
 
$
(4,403
)
 
$
(6,879
)
 
$
(8,534
)
International
 
16,288

 
19,184

 
16,886

Income from continuing operations before provision/(benefit) for taxes on income(a), (b)
 
$
11,885

 
$
12,305

 
$
8,351

(a) 
2018 v. 2017––The decrease in the domestic loss was primarily due to lower interest expense paid to certain foreign subsidiaries, lower net losses on the retirement of debt, higher net gains on investments in equity securities and increased revenue related to Eliquis, partially offset by higher certain asset impairments and lower revenue for Viagra and the SIP portfolio. The decrease in international income was primarily related to lower interest income received primarily from intercompany borrowings from Pfizer Inc. and higher charges related to certain cost reduction initiatives, partially offset by increased revenue related to Ibrance and Eliquis.
(b) 
2017 v. 2016––The decrease in the domestic loss was primarily due to lower restructuring charges and certain acquisition-related costs, the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower certain asset impairments and lower certain legal matters, partially offset by higher net losses on early retirement of debt, and higher amortization of intangible assets. The increase in international income was primarily due to the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower restructuring charges and certain acquisition-related costs, and lower certain asset impairments.
Schedule of Provision for Taxes on Income
The following table provides the components of Provision/(benefit) for taxes on income based on the location of the taxing authorities:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

United States
 
 
 
 
 
 
Current income taxes:
 
 
 
 
 
 
Federal
 
$
668

 
$
1,267

 
$
342

State and local
 
9

 
45

 
(52
)
Deferred income taxes:
 
 
 
 
 
 
Federal
 
(1,663
)
 
(2,064
)
 
(419
)
State and local
 
16

 
(304
)
 
(106
)
Total U.S. tax provision
 
(970
)
 
(1,055
)
 
(235
)
TCJA(a)
 
 
 
 
 
 
Current income taxes
 
(3,035
)
 
13,135

 
—

Deferred Income taxes
 
2,439

 
(23,795
)
 
—

Total TCJA tax provision
 
(596
)
 
(10,660
)
 
—

International
 
 
 
 
 
 
Current income taxes
 
2,831

 
2,709

 
1,532

Deferred income taxes
 
(558
)
 
(42
)
 
(175
)
Total international tax provision
 
2,273

 
2,667

 
1,358

Provision/(benefit) for taxes on income
 
$
706

 
$
(9,049
)
 
$
1,123


(a) 
The 2018 current tax benefit and deferred tax expense primarily relate to the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See discussion below and Note 5C.
Schedule of Effective Income Tax Rate Reconciliation
The reconciliation of the U.S. statutory income tax rate to our effective tax rate for Income from continuing operations follows:
 
 
Year Ended December 31,
 
 
2018

 
2017

 
2016

U.S. statutory income tax rate
 
21.0
 %
 
35.0
 %
 
35.0
 %
TCJA impact(a)
 
(5.0
)
 
(86.6
)
 
—

Taxation of non-U.S. operations (b), (c), (d)
 
(6.1
)
 
(17.0
)
 
(13.8
)
Tax settlements and resolution of certain tax positions(e)
 
(5.8
)
 
(1.2
)
 
(5.5
)
U.S. Healthcare Legislation(e), (f)
 
(0.4
)
 
0.9

 
1.3

U.S. R&D tax credit and manufacturing deduction(e)
 
(0.7
)
 
(0.7
)
 
(1.0
)
Certain legal settlements and charges(e)
 
(0.1
)
 
0.1

 
(2.9
)
All other, net(g)
 
3.1

 
(3.9
)
 
0.3

Effective tax rate for income from continuing operations
 
5.9
 %
 
(73.5
)%
 
13.4
 %
(a) 
For a discussion about the enactment of the TCJA, see Note 5A.
(b) 
For taxation of non-U.S. operations, this rate impact reflects the income tax rates and relative earnings in the locations where we do business outside the U.S., together with the cost of repatriation decisions, which, for 2017, includes the repatriation tax on deemed repatriated 2017 earnings of foreign subsidiaries discussed in Note 5A, changes in uncertain tax positions not included in the reconciling item called “Tax settlements and resolution of certain tax positions,” as well as changes in valuation allowances. Specifically: (i) the jurisdictional location of earnings is a significant component of our effective tax rate each year, and the rate impact of this component is influenced by the specific location of non-U.S. earnings and the level of such earnings as compared to our total earnings; (ii) the cost of repatriation decisions, and other U.S. tax implications of our foreign operations, is a significant component of our effective tax rate each year and generally offsets some of the reduction to our effective tax rate each year resulting from the jurisdictional location of earnings; and (iii) the impact of changes in uncertain tax positions not included in the reconciling item called “Tax settlements and resolution of certain tax positions” is a component of our effective tax rate each year that can result in either an increase or decrease to our effective tax rate. The jurisdictional mix of earnings, which includes the impact of the location of earnings as well as repatriation costs, can vary as a result of the repatriation decisions, as a result of operating fluctuations in the normal course of business and as a result of the extent and location of other income and expense items, such as restructuring charges, asset impairments and gains and losses on strategic business decisions. See also Note 5A for the components of pre-tax income and Provision/(benefit) for taxes on income, which is based on the location of the taxing authorities, and for information about settlements and other items impacting Provision/(benefit) for taxes on income.
(c) 
In all periods presented, the reduction in our effective tax rate resulting from the jurisdictional location of earnings is largely due to lower tax rates in certain jurisdictions, as well as manufacturing and other incentives associated with our subsidiaries in Puerto Rico and Singapore. 2016 also includes incentives in Costa Rica and the Dominican Republic related to the Hospira infusion systems business, which was sold to ICU Medical in February 2017. We benefit from a Puerto Rican incentive grant that expires in 2029. Under the grant, we are partially exempt from income, property and municipal taxes. In Singapore, we benefit from incentive tax rates effective through 2031 on income from manufacturing and other operations.
(d) 
The favorable rate impacts in 2018 and 2017 also reflect lower repatriation costs associated with the estimated income of our foreign subsidiaries. The favorable rate impact in 2016 also includes the non-recurrence of the non-deductibility of a foreign currency loss related to Venezuela.
(e) 
For a discussion about tax settlements and resolution of certain tax positions, the impact of U.S. Healthcare Legislation, the U.S. R&D tax credit and manufacturing deduction and the impact of certain legal settlements and charges, see Note 5A.
(f) 
The favorable rate impact in 2018 is a result of the updated 2017 invoice received from the federal government, which reflected a lower expense than what was previously estimated for invoiced periods, as well as certain tax initiatives.
(g) 
All other, net in 2018 is primarily due to routine business operations and the non-recurrence of tax benefits associated with certain tax initiatives. 2017 primarily relates to tax benefits associated with certain tax initiatives in the normal course of business.

Schedule of Deferred Tax Assets and Liabilities
The components of our deferred tax assets and liabilities, shown before jurisdictional netting, follow:
 
 
2018 Deferred Tax*
 
2017 Deferred Tax*
(MILLIONS OF DOLLARS)
 
Assets
 
(Liabilities)
 
Assets
 
(Liabilities)
Prepaid/deferred items
 
$
1,655

 
$
(325
)
 
$
1,837

 
$
(132
)
Inventories
 
280

 
(10
)
 
405

 
(3
)
Intangible assets(a)
 
532

 
(7,620
)
 
685

 
(10,808
)
Property, plant and equipment
 
160

 
(1,011
)
 
124

 
(755
)
Employee benefits
 
2,292

 
(134
)
 
2,346

 
(109
)
Restructurings and other charges
 
266

 
—

 
240

 
(8
)
Legal and product liability reserves
 
415

 
—

 
480

 
—

Net operating loss/tax credit carryforwards(b), (c)
 
2,512

 
—

 
4,502

 
—

Unremitted earnings
 
—

 
(83
)
 
—

 
(85
)
State and local tax adjustments
 
264

 
—

 
178

 
—

All other
 
200

 
(274
)
 
492

 
(424
)
 
 
8,576

 
(9,456
)
 
11,289

 
(12,325
)
Valuation allowances
 
(2,068
)
 
—

 
(2,203
)
 
—

Total deferred taxes
 
$
6,508

 
$
(9,456
)
 
$
9,086

 
$
(12,325
)
Net deferred tax liability(d)
 
 
 
$
(2,948
)
 
 
 
$
(3,238
)
*
For 2018 and 2017, the deferred tax assets and liabilities associated with global intangible low-taxed income are included in the relevant categories above. See Note 5A. 2018 excludes deferred tax assets and liabilities associated with fully dedicated consumer healthcare subsidiaries. For additional information, see Note 2C.
(a) 
The decrease in 2018 is primarily the result of amortization of intangible assets and certain impairment charges.
(b) 
The decrease in 2018 is primarily a result of the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See Note 5A.
(c) 
The amounts in 2018 and 2017 are reduced for unrecognized tax benefits of $3.3 billion and $3.4 billion, respectively, where we have net operating loss carryforwards, similar tax losses, and/or tax credit carryforwards that are available, under the tax law of the applicable jurisdiction, to settle any additional income taxes that would result from the disallowance of a tax position.
(d) 
In 2018, Noncurrent deferred tax assets and other noncurrent tax assets ($0.8 billion), and Noncurrent deferred tax liabilities ($3.7 billion). In 2017, Noncurrent deferred tax assets and other noncurrent tax assets ($0.7 billion), and Noncurrent deferred tax liabilities ($3.9 billion).
Schedule of Unrecognized Tax Benefits Roll Forward
The reconciliation of the beginning and ending amounts of gross unrecognized tax benefits follows:
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Balance, beginning
 
$
(6,558
)
 
$
(5,826
)
 
$
(5,919
)
Acquisitions(a)
 
—

 
10

 
(83
)
Increases based on tax positions taken during a prior period(b)
 
(192
)
 
(49
)
 
(11
)
Decreases based on tax positions taken during a prior period(b), (c)
 
561

 
28

 
409

Decreases based on settlements for a prior period(d)
 
123

 
35

 
126

Increases based on tax positions taken during the current period(b)
 
(370
)
 
(753
)
 
(489
)
Impact of foreign exchange
 
56

 
(121
)
 
(5
)
Other, net(b), (e)
 
121

 
118

 
146

Balance, ending(f)
 
$
(6,259
)
 
$
(6,558
)
 
$
(5,826
)
(a) 
For 2017 and 2016, primarily related to the acquisitions of Medivation and Anacor. See also Note 2A.
(b) 
Primarily included in Provision/(benefit) for taxes on income.
(c) 
Primarily related to effectively settling certain tax positions primarily with foreign tax authorities. See also Note 5A.
(d) 
Primarily related to cash payments and reductions of tax attributes.
(e) 
Primarily related to decreases as a result of a lapse of applicable statutes of limitations.
(f) 
In 2018, included in Income taxes payable ($11 million), Current tax assets ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($47 million), Noncurrent deferred tax liabilities ($3.2 billion) and Other taxes payable ($3.0 billion). In 2017, included in Income taxes payable ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($123 million), Noncurrent deferred tax liabilities ($3.3 billion) and Other taxes payable ($3.2 billion).
Schedule of Other Comprehensive Income (Loss), Components of Income Tax Expense (Benefit)
The following table provides the components of the Tax provision/(benefit) on other comprehensive income/(loss):
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Foreign currency translation adjustments, net(a)
 
$
94

 
$
(215
)
 
$
(15
)
Unrealized holding gains/(losses) on derivative financial instruments, net
 
21

 
72

 
(75
)
Reclassification adjustments for (gains)/losses included in net income
 
27

 
(224
)
 
158

Reclassification adjustments of certain tax effects from AOCI to Retained earnings(b)
 
1

 
—

 
—

 
 
50

 
(152
)
 
83

Unrealized holding gains/(losses) on available-for-sale securities, net
 
(23
)
 
102

 
49

Reclassification adjustments for (gains)/losses included in net income
 
16

 
(60
)
 
(15
)
Reclassification adjustments for tax on unrealized gains from AOCI to Retained earnings(c)
 
(45
)
 
—

 
—

 
 
(53
)
 
42

 
34

Benefit plans: actuarial losses, net
 
(141
)
 
(59
)
 
(535
)
Reclassification adjustments related to amortization
 
55

 
192

 
186

Reclassification adjustments related to settlements, net
 
33

 
42

 
45

Reclassification adjustments of certain tax effects from AOCI to Retained earnings(b)
 
637

 
—

 
—

Other
 
29

 
(39
)
 
36

 
 
612

 
137

 
(269
)
Benefit plans: prior service (costs)/credits and other, net
 
2

 
—

 
67

Reclassification adjustments related to amortization
 
(39
)
 
(67
)
 
(64
)
Reclassification adjustments related to curtailments, net
 
(4
)
 
(7
)
 
(10
)
Reclassification adjustments of certain tax effects from AOCI to Retained earnings(b)
 
(144
)
 
—

 
—

Other
 
—

 
—

 
(1
)
 
 
(185
)
 
(74
)
 
(7
)
Tax provision/(benefit) on other comprehensive income/(loss)
 
$
518

 
$
(262
)
 
$
(174
)
(a) 
Taxes are not provided for foreign currency translation adjustments relating to investments in international subsidiaries that will be held indefinitely.
(b) 
For additional information on the adoption of a new accounting standard related to reclassification of certain tax effects from AOCI, see Note 1B.
(c) 
For additional information on the adoption of a new accounting standard related to financial assets and liabilities, see Note 1B.
v3.10.0.1
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests (Tables)
 12 Months Ended
Dec. 31, 2018
Equity [Abstract]  
Schedule of Changes in Accumulated Other Comprehensive Loss, Net of Tax
The following table provides the changes, net of tax, in Accumulated other comprehensive loss:
 
 
Net Unrealized Gain/(Losses)
 
Benefit Plans
 
 
(MILLIONS OF DOLLARS)
 
Foreign Currency Translation Adjustments

 
Derivative Financial Instruments

 
Available-For-Sale Securities

 
Actuarial Gains/(Losses)

 
Prior Service (Costs)/ Credits and Other

 
Accumulated Other Comprehensive Income/(Loss)

Balance, January 1, 2016
 
$
(5,863
)
 
$
421

 
$
(227
)
 
$
(4,733
)
 
$
880

 
$
(9,522
)
Other comprehensive income/(loss)(a)
 
(797
)
 
(73
)
 
96

 
(740
)
 
(1
)
 
(1,514
)
Balance, December 31, 2016
 
(6,659
)
 
348

 
(131
)
 
(5,473
)
 
879

 
(11,036
)
Other comprehensive income/(loss)(a)
 
1,479

 
(378
)
 
532

 
211

 
(129
)
 
1,715

Balance, December 31, 2017
 
(5,180
)
 
(30
)
 
401

 
(5,262
)
 
750

 
(9,321
)
Other comprehensive income/(loss) due to the adoption of new accounting standards(b)
 
(2
)
 
(1
)
 
(416
)
 
(637
)
 
144

 
(913
)
Other comprehensive income/(loss)(a)
 
(893
)
 
198

 
(53
)
 
(128
)
 
(166
)
 
(1,041
)
Balance, December 31, 2018
 
$
(6,075
)
 
$
167

 
$
(68
)
 
$
(6,027
)
 
$
728

 
$
(11,275
)
(a) 
Amounts do not include foreign currency translation adjustments attributable to noncontrolling interests of $20 million loss in 2018, $14 million income in 2017 and $3 million loss in 2016.
(b) 
Amounts represent the cumulative effect adjustments as of January 1, 2018 from the adoption of new accounting standards related to (i) financial assets and liabilities and (ii) the reclassification of certain tax effects from AOCI. For additional information, see Note 1B.
v3.10.0.1
Financial Instruments (Tables)
 12 Months Ended
Dec. 31, 2018
Financial Instruments [Abstract]  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis
The following table presents the financial assets and liabilities measured at fair value using a market approach on a recurring basis by balance sheet categories and fair value hierarchy level as defined in Note 1E:
 
 
December 31, 2018
 
December 31, 2017
(MILLIONS OF DOLLARS)
 
Total

 
Level 1

 
Level 2

 
Total

 
Level 1

 
Level 2

Financial assets measured at fair value on a recurring basis:
 
 
 
 
 
 
 
 
 
 
 
 
Short-term investments
 
 
 
 
 
 
 
 
 
 
 
 
Classified as equity securities:
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
$
1,571

 
$
—

 
$
1,571

 
$
2,115

 
$
—

 
$
2,115

Equity(a)
 
29

 
17

 
11

 
35

 
16

 
19

 
 
1,600

 
17

 
1,583

 
2,150

 
16

 
2,134

Classified as available-for-sale debt securities:
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency—non-U.S.
 
9,609

 
—

 
9,609

 
12,242

 
—

 
12,242

Corporate and other
 
5,482

 
—

 
5,482

 
3,120

 
—

 
3,120

 
 
15,091

 
—

 
15,091

 
15,362

 
—

 
15,362

Total short-term investments
 
16,691

 
17

 
16,674

 
17,512

 
16

 
17,496

Other current assets
 
 
 
 
 
 
 
 
 
 
 
 
Derivative assets:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
97

 
—

 
97

 
104

 
—

 
104

Foreign exchange contracts
 
477

 
—

 
477

 
234

 
—

 
234

Total other current assets
 
574

 
—

 
574

 
337

 
—

 
337

Long-term investments
 
 
 
 
 
 
 
 
 
 
 
 
Classified as equity securities:
 
 
 
 
 
 
 
 
 
 
 
 
Equity(a)
 
1,223

 
1,193

 
30

 
1,440

 
1,398

 
42

Classified as trading securities:
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
50

 
50

 
—

 
73

 
73

 
—

 
 
1,273

 
1,243

 
30

 
1,514

 
1,472

 
42

Classified as available-for-sale debt securities:
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency—non-U.S.
 
94

 
—

 
94

 
387

 
—

 
387

Corporate and other
 
397

 
—

 
397

 
4,702

 
36

 
4,667

 
 
491

 
—

 
491

 
5,090

 
36

 
5,054

Total long-term investments
 
1,764

 
1,243

 
521

 
6,603

 
1,507

 
5,096

Other noncurrent assets
 
 
 
 
 
 
 
 
 
 
 
 
Derivative assets:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
335

 
—


335

 
477

 
—

 
477

Foreign exchange contracts
 
232

 
—


232

 
7

 
—

 
7

Total other noncurrent assets
 
566

 
—


566

 
484

 
—

 
484

Total assets
 
$
19,595

 
$
1,260


$
18,335

 
$
24,937

 
$
1,523

 
$
23,414

 
 
 
 
 
 
 
 
 
 
 
 
 
Financial liabilities measured at fair value on a recurring basis:
 
 
 
 
 
 
 
 
 
 
 
 
Other current liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
$
5

 
$
—

 
$
5

 
$
1

 
$
—

 
$
1

Foreign exchange contracts
 
78

 
—

 
78

 
201

 
—

 
201

Total other current liabilities
 
82

 
—

 
82

 
201

 
—

 
201

Other noncurrent liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
378

 
—

 
378

 
177

 
—

 
177

Foreign exchange contracts
 
564

 
—

 
564

 
313

 
—

 
313

Total other noncurrent liabilities
 
942

 
—

 
942

 
490

 
—

 
490

Total liabilities
 
$
1,024

 
$
—

 
$
1,024

 
$
691

 
$
—

 
$
691

(a) 
As of December 31, 2018, short-term equity securities of $11 million and long-term equity securities of $29 million are held in trust for benefits attributable to the former Pharmacia Savings Plus Plan. As of December 31, 2017, short-term equity securities of $19 million and long-term equity securities of $42 million are held in trust for benefits attributable to the former Pharmacia Savings Plus Plan.
Financial Liabilities Not Measured at Fair Value on a Recurring Basis
The following table presents the financial liabilities not measured at fair value on a recurring basis, including the carrying values and estimated fair values using a market approach:
 
 
December 31, 2018
 
December 31, 2017
 
 
Carrying Value

 
Estimated Fair Value
 
Carrying Value
 
Estimated Fair Value
(MILLIONS OF DOLLARS)
 
 
 
Total

 
Level 2

 
 
 
Total

 
Level 2

Financial Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Long-term debt, excluding the current portion
 
$
32,909

 
$
35,260

 
$
35,260

 
$
33,538

 
$
37,253

 
$
37,253
Summary of Investments
The following table represents our investments by classification type:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018
 
2017
Short-term investments
 
 
 
 
Equity securities
 
$
1,600

 
$
2,150

Available-for-sale debt securities
 
15,091

 
15,362

Held-to-maturity debt securities
 
1,003

 
1,138

Total Short-term investments
 
$
17,694

 
$
18,650

 
 
 
 
 
Long-term investments
 
 
 
 
Equity securities
 
$
1,223

 
$
1,440

Trading equity securities
 
50

 
73

Available-for-sale debt securities
 
491

 
5,090

Held-to-maturity debt securities
 
59

 
4

Private equity investments carried at equity-method or cost
 
944

 
408

Total Long-term investments
 
$
2,767

 
$
7,015

Held-to-maturity cash equivalents
 
$
199

 
$
719
Contractual Maturities of Available-for-sale and Held-to-maturity Securities
At December 31, 2018 and 2017, the investment securities portfolio consisted of debt securities that were virtually all investment-grade.
Information on investments in debt and equity securities at December 31, 2018 and December 31, 2017 is as follows, including, as of December 31, 2018, the contractual maturities, or as necessary, the estimated maturities, of the available-for-sale and held-to-maturity debt securities:
 
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Gross Unrealized
 
 
 
Maturities (in Years)
 
 
 
 
Gross Unrealized
 
 
 
(MILLIONS OF DOLLARS)
 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

 
Within 1

 
Over 1
to 5

 
Over 5

 
Total

 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

Available-for-sale debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency––non-U.S.
 
$
9,754

 
$
7

 
$
(58
)
 
$
9,703

 
$
9,609

 
$
94

 
$
—

 
$
9,703

 
$
12,616

 
$
61

 
$
(48
)
 
$
12,629

Corporate and other(a)
 
5,905

 
—

 
(27
)
 
5,878

 
5,482

 
394

 
3

 
5,878

 
7,859

 
15

 
(52
)
 
7,823

Held-to-maturity debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Time deposits and other
 
668

 
—

 
—

 
668

 
610

 
24

 
35

 
668

 
1,091

 
—

 
—

 
1,091

Government and agency––non-U.S.
 
592

 
—

 
—

 
592

 
592

 
—

 
—

 
592

 
770

 
—

 
—

 
770

Total debt securities
 
$
16,920

 
$
8

 
$
(85
)
 
$
16,842

 
$
16,293

 
$
512

 
$
38

 
$
16,842

 
$
22,337

 
$
77

 
$
(100
)
 
$
22,313

Available-for-sale equity securities(b)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,115

 
$
—

 
$
—

 
$
2,115

Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
728

 
586

 
(124
)
 
1,190

Total available-for-sale equity securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,843

 
$
586

 
$
(124
)
 
$
3,304

(a) 
Primarily issued by a diverse group of corporations.
(b) 
Upon the 2018 adoption of a new accounting standard related to financial assets and liabilities, available-for-sale equity securities were classified as equity securities. For additional information see Note 1B.
Schedule of Available-for-sale Securities Reconciliation
At December 31, 2018 and 2017, the investment securities portfolio consisted of debt securities that were virtually all investment-grade.
Information on investments in debt and equity securities at December 31, 2018 and December 31, 2017 is as follows, including, as of December 31, 2018, the contractual maturities, or as necessary, the estimated maturities, of the available-for-sale and held-to-maturity debt securities:
 
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Gross Unrealized
 
 
 
Maturities (in Years)
 
 
 
 
Gross Unrealized
 
 
 
(MILLIONS OF DOLLARS)
 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

 
Within 1

 
Over 1
to 5

 
Over 5

 
Total

 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

Available-for-sale debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency––non-U.S.
 
$
9,754

 
$
7

 
$
(58
)
 
$
9,703

 
$
9,609

 
$
94

 
$
—

 
$
9,703

 
$
12,616

 
$
61

 
$
(48
)
 
$
12,629

Corporate and other(a)
 
5,905

 
—

 
(27
)
 
5,878

 
5,482

 
394

 
3

 
5,878

 
7,859

 
15

 
(52
)
 
7,823

Held-to-maturity debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Time deposits and other
 
668

 
—

 
—

 
668

 
610

 
24

 
35

 
668

 
1,091

 
—

 
—

 
1,091

Government and agency––non-U.S.
 
592

 
—

 
—

 
592

 
592

 
—

 
—

 
592

 
770

 
—

 
—

 
770

Total debt securities
 
$
16,920

 
$
8

 
$
(85
)
 
$
16,842

 
$
16,293

 
$
512

 
$
38

 
$
16,842

 
$
22,337

 
$
77

 
$
(100
)
 
$
22,313

Available-for-sale equity securities(b)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,115

 
$
—

 
$
—

 
$
2,115

Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
728

 
586

 
(124
)
 
1,190

Total available-for-sale equity securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,843

 
$
586

 
$
(124
)
 
$
3,304

(a) 
Primarily issued by a diverse group of corporations.
(b) 
Upon the 2018 adoption of a new accounting standard related to financial assets and liabilities, available-for-sale equity securities were classified as equity securities. For additional information see Note 1B.
Schedule of Gains and Losses on Investment Securities
The following table presents the net unrealized gains and losses for the period that relate to equity securities still held at the reporting date, calculated as follows:
(MILLIONS OF DOLLARS)
 
December 31, 2018

Net gains recognized during the period on investments in equity securities(a)
 
$
586

Less: Net gains recognized during the period on equity securities sold during the period
 
(109
)
Net unrealized gains during the reporting period on equity securities still held at the reporting date
 
$
477

(a) 
The net gains on investments in equity securities are reported in Other (income)/deductions––net and, for 2018, include unrealized net gains on equity securities reflecting the adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 4.
Held-to-maturity Securities
At December 31, 2018 and 2017, the investment securities portfolio consisted of debt securities that were virtually all investment-grade.
Information on investments in debt and equity securities at December 31, 2018 and December 31, 2017 is as follows, including, as of December 31, 2018, the contractual maturities, or as necessary, the estimated maturities, of the available-for-sale and held-to-maturity debt securities:
 
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Gross Unrealized
 
 
 
Maturities (in Years)
 
 
 
 
Gross Unrealized
 
 
 
(MILLIONS OF DOLLARS)
 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

 
Within 1

 
Over 1
to 5

 
Over 5

 
Total

 
Amortized Cost

 
Gains

 
Losses

 
Fair Value

Available-for-sale debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government and agency––non-U.S.
 
$
9,754

 
$
7

 
$
(58
)
 
$
9,703

 
$
9,609

 
$
94

 
$
—

 
$
9,703

 
$
12,616

 
$
61

 
$
(48
)
 
$
12,629

Corporate and other(a)
 
5,905

 
—

 
(27
)
 
5,878

 
5,482

 
394

 
3

 
5,878

 
7,859

 
15

 
(52
)
 
7,823

Held-to-maturity debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Time deposits and other
 
668

 
—

 
—

 
668

 
610

 
24

 
35

 
668

 
1,091

 
—

 
—

 
1,091

Government and agency––non-U.S.
 
592

 
—

 
—

 
592

 
592

 
—

 
—

 
592

 
770

 
—

 
—

 
770

Total debt securities
 
$
16,920

 
$
8

 
$
(85
)
 
$
16,842

 
$
16,293

 
$
512

 
$
38

 
$
16,842

 
$
22,337

 
$
77

 
$
(100
)
 
$
22,313

Available-for-sale equity securities(b)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,115

 
$
—

 
$
—

 
$
2,115

Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
728

 
586

 
(124
)
 
1,190

Total available-for-sale equity securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
2,843

 
$
586

 
$
(124
)
 
$
3,304

(a) 
Primarily issued by a diverse group of corporations.
(b) 
Upon the 2018 adoption of a new accounting standard related to financial assets and liabilities, available-for-sale equity securities were classified as equity securities. For additional information see Note 1B.
Schedule of Short-term Borrowings
Short-term borrowings include:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018
 
2017
Commercial paper
 
$
3,100

 
$
6,100

Current portion of long-term debt, principal amount(a) 
 
4,781

 
3,532

Other short-term borrowings, principal amount(b)
 
966

 
320

Total short-term borrowings, principal amount
 
8,847

 
9,951

Net fair value adjustments related to hedging and purchase accounting
 
(5
)
 
14

Net unamortized discounts, premiums and debt issuance costs
 
(11
)
 
(12
)
Total Short-term borrowings, including current portion of long-term debt, carried at historical proceeds, as adjusted
 
$
8,831

 
$
9,953

(a) 
For additional information, see Note 7D.
(b) 
Other short-term borrowings primarily include cash collateral. For additional information, see Note 7F.
Schedule of Long-term Debt Instruments
In 2018, we issued the following senior unsecured notes:
(MILLIONS OF DOLLARS)
 
 
 
 
Maturity Date
 
Interest Rate
 
Principal
September 2021
 
3.000% notes(a)
 
$
1,000

September 2023
 
Floating rate notes (LIBOR plus 0.33%)(b)
 
300

September 2023
 
3.200% notes(a)
 
1,000

September 2028
 
3.600% notes(a)
 
1,000

September 2038
 
4.100% notes(a)
 
700

September 2048
 
4.200% notes(a)
 
1,000

Total long-term debt issued(c)
 
$
5,000

(a) 
Fixed rate notes may be redeemed by us at any time, in whole, or in part, at varying redemption prices plus accrued and unpaid interest.
(b) 
Floating rate notes may not be redeemed by their terms prior to maturity.
(c) 
The weighted-average effective interest rate for the notes at issuance was 3.56%.
The following table provides the components of our senior unsecured long-term debt, including the weighted-average stated interest rate for 2018 and 2017 by maturity:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Notes due 2019 (1.3%)(a)
 
$
—

 
$
4,848

Notes due 2020 (1.2% and 1.1%)
 
1,474

 
1,528

Notes due 2021 (3.4% and 3.5%)
 
4,459

 
3,550

Notes due 2022 (0.3%)
 
1,145

 
1,199

Notes due 2023 (3.6% and 4.3%)
 
2,892

 
1,592

Notes due 2024 (4.4%)
 
1,500

 
1,500

Notes due 2026-2028 (3.3% and 3.2%)
 
5,718

 
4,759

Notes due 2034 (6.5%)
 
750

 
750

Notes due 2036-2039 (6.0% and 6.2%)
 
7,301

 
6,636

Notes due 2040-2044 (3.8%)
 
4,004

 
4,106

Notes due 2046-2048 (4.2%)
 
3,315

 
2,315

Total long-term debt, principal amount
 
32,558

 
32,783

Net fair value adjustments related to hedging and purchase accounting
 
479

 
872

Net unamortized discounts, premiums and debt issuance costs
 
(136
)
 
(125
)
Other long-term debt
 
7

 
8

Total long-term debt, carried at historical proceeds, as adjusted
 
$
32,909

 
$
33,538

Current portion of long-term debt, carried at historical proceeds (not included above (1.3% and 2.4%))
 
$
4,776

 
$
3,546

(a) 
At December 31, 2018, the debt issuances have been reclassified to the current portion of long-term debt.
Schedule of Derivative Financial Instruments
The following table provides the fair value of the derivative financial instruments and the related notional amounts presented between those derivatives that are designated as hedging instruments and those that are not designated as hedging instruments:
(MILLIONS OF DOLLARS)
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Fair Value
 
 
 
Fair Value
 
 
Notional
 
Asset
 
Liability
 
Notional
 
Asset
 
Liability
Derivatives designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts(a)
 
$
22,984

 
$
654

 
$
586

 
$
18,723

 
$
179

 
$
459

Interest rate contracts
 
11,145

 
432

 
383

 
12,430

 
581

 
178

 
 
 
 
1,085

 
968

 
 
 
760

 
637

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
$
15,154

 
55

 
55

 
$
14,300

 
62

 
54

 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
 
 
$
1,140

 
$
1,024

 
 
 
$
822

 
$
691

(a) 
As of December 31, 2018, the notional amount of outstanding foreign currency forward-exchange contracts hedging our intercompany forecasted inventory sales was $5.8 billion.
Schedule of Derivative Assets at Fair Value
The following table provides the fair value of the derivative financial instruments and the related notional amounts presented between those derivatives that are designated as hedging instruments and those that are not designated as hedging instruments:
(MILLIONS OF DOLLARS)
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Fair Value
 
 
 
Fair Value
 
 
Notional
 
Asset
 
Liability
 
Notional
 
Asset
 
Liability
Derivatives designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts(a)
 
$
22,984

 
$
654

 
$
586

 
$
18,723

 
$
179

 
$
459

Interest rate contracts
 
11,145

 
432

 
383

 
12,430

 
581

 
178

 
 
 
 
1,085

 
968

 
 
 
760

 
637

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
$
15,154

 
55

 
55

 
$
14,300

 
62

 
54

 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
 
 
$
1,140

 
$
1,024

 
 
 
$
822

 
$
691

(a) 
As of December 31, 2018, the notional amount of outstanding foreign currency forward-exchange contracts hedging our intercompany forecasted inventory sales was $5.8 billion.
Schedule of Derivative Liabilities at Fair Value
The following table provides the fair value of the derivative financial instruments and the related notional amounts presented between those derivatives that are designated as hedging instruments and those that are not designated as hedging instruments:
(MILLIONS OF DOLLARS)
 
December 31, 2018
 
December 31, 2017
 
 
 
 
Fair Value
 
 
 
Fair Value
 
 
Notional
 
Asset
 
Liability
 
Notional
 
Asset
 
Liability
Derivatives designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts(a)
 
$
22,984

 
$
654

 
$
586

 
$
18,723

 
$
179

 
$
459

Interest rate contracts
 
11,145

 
432

 
383

 
12,430

 
581

 
178

 
 
 
 
1,085

 
968

 
 
 
760

 
637

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
$
15,154

 
55

 
55

 
$
14,300

 
62

 
54

 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
 
 
$
1,140

 
$
1,024

 
 
 
$
822

 
$
691

(a) 
As of December 31, 2018, the notional amount of outstanding foreign currency forward-exchange contracts hedging our intercompany forecasted inventory sales was $5.8 billion.
Schedule of Gains/(Losses) Incurred to Hedge or Offset Operational Foreign Exchange or Interest Rate Risk
The following table provides information about the gains/(losses) incurred to hedge or offset operational foreign exchange or interest rate risk:
 
 
Amount of
Gains/(Losses)
Recognized in OID(a), (b)
 
Amount of Gains/(Losses)
Recognized in OCI(a), (c)
 
Amount of Gains/(Losses)
Reclassified from
OCI into OID and COS(a), (c)
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Derivative Financial Instruments in Cash Flow Hedge Relationships:
 
 

 
 

 
 

 
 

 
 

 
 

Foreign exchange contracts(d)
 
$
—

 
$
(6
)
 
$
80

 
$
(12
)
 
$
(182
)
 
$
520

Amount excluded from effectiveness testing recognized in earnings based on an amortization approach
 
—

 
 

 
140

 
 

 
153

 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Financial Instruments in Fair Value Hedge Relationships:
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
(348
)
 
(60
)
 
—

 
—

 
—

 
—

Hedged item gain
 
348

 
60

 
—

 
—

 
—

 
—

Foreign exchange contracts
 
5

 
(19
)
 
—

 
—

 
—

 
—

Hedged item gain/(loss)
 
(5
)
 
19

 
—

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Financial Instruments in Net Investment Hedge Relationships:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
—

 
—

 
175

 
—

 
—

 
—

The portion of gains/(losses) on foreign exchange contracts excluded from the assessment of hedge effectiveness
 
—

 
 

 
77

 
 

 
68

 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
Non-Derivative Financial Instruments in Net Investment Hedge Relationships:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency short-term borrowings
 
—

 
—

 
68

 
—

 
—

 
—

Foreign currency long-term debt(e)
 
—

 
—

 
149

 
(580
)
 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Financial Instruments Not Designated as Hedges:
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 
136

 
(87
)
 
—

 
—

 
—

 
—

All other net
 
—

 
—

 
(1
)
 
2

 
2

 
1

 
 
$
136

 
$
(93
)
 
$
688

 
$
(591
)
 
$
41

 
$
520


(a) 
OID = Other (income)/deductions—net, included in Other (income)/deductions—net in the consolidated statements of income. COS = Cost of Sales, included in Cost of sales in the consolidated statements of income. OCI = Other comprehensive income/(loss), included in the consolidated statements of comprehensive income.
(b) 
For 2017, there is no significant ineffectiveness.
(c) 
For derivative financial instruments in cash flow hedge relationships, the gains and losses are included in Other comprehensive income/(loss)––Unrealized holding gains/(losses) on derivative financial instruments, net. For derivative financial instruments in net investment hedge relationships and for foreign currency debt designated as hedging instruments, the effective portion is included in Other comprehensive income/(loss)––Foreign currency translation adjustments, net.
(d) 
Based on year-end foreign exchange rates that are subject to change, we expect to reclassify a pre-tax gain of $156 million within the next 12 months into Cost of sales. The maximum length of time over which we are hedging future foreign exchange cash flow relates to our $1.8 billion U.K. pound debt maturing in 2043.
(e) 
Short-term borrowings include foreign currency short-term borrowings with carrying values of $1.4 billion as of December 31, 2018, which are used as hedging instruments in net investment hedges. Long-term debt includes foreign currency long-term borrowings with carrying values of $3.2 billion as of December 31, 2018, which are used as hedging instruments in net investment hedges.
Schedule of Amounts Recorded In Balance Sheet Related to Cumulative Adjustments for Fair Value Hedges
The following table provides the total amount of each income and expense line in which the results of fair value or cash flow hedges are recorded:
(MILLIONS OF DOLLARS)
 
December 31, 2018

Cost of sales
 
$
11,248

Other (income)/deductions—net
 
2,116


The following table provides the amounts recorded in our consolidated balance sheet related to cumulative basis adjustments for fair value hedges:
 
 
Carrying Amount of Hedged Assets/Liabilities

 
Cumulative Amount of Fair Value Hedging Adjustment Gains/(Losses) Included in the Carrying Amount of the Hedged Assets/Liabilities

(MILLIONS OF DOLLARS)
 
December 31, 2018

 
December 31, 2018

Long-term investments
 
$
45

 
$
(1
)
Short-term borrowings, including current portion of long-term debt
 
1,499

 
5

Long-term debt
 
9,952

 
45
Schedule of Amounts Recorded In Balance Sheet Related to Cumulative Adjustments for Cash Flow Hedges
The following table provides the total amount of each income and expense line in which the results of fair value or cash flow hedges are recorded:
(MILLIONS OF DOLLARS)
 
December 31, 2018

Cost of sales
 
$
11,248

Other (income)/deductions—net
 
2,116
v3.10.0.1
Inventories (Tables)
 12 Months Ended
Dec. 31, 2018
Inventory Disclosure [Abstract]  
Schedule of Components of Inventories, Current
The following table provides the components of Inventories:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Finished goods
 
$
2,262

 
$
2,883

Work in process
 
4,701

 
3,908

Raw materials and supplies
 
546

 
788

Inventories(a)
 
$
7,508

 
$
7,578

Noncurrent inventories not included above(b)
 
$
618

 
$
683

(a) 
The change from December 31, 2017 primarily reflects the reclassification of $538 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and a decrease due to foreign exchange, partially offset by increases for certain products to meet targeted levels in the normal course of business, primarily for inventory build for supply recovery, new product launches and the movement of products within our manufacturing network.
(b) 
Included in Other noncurrent assets. There are no recoverability issues associated with these amounts.
Schedule of Component of Inventories, Noncurrent
The following table provides the components of Inventories:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

Finished goods
 
$
2,262

 
$
2,883

Work in process
 
4,701

 
3,908

Raw materials and supplies
 
546

 
788

Inventories(a)
 
$
7,508

 
$
7,578

Noncurrent inventories not included above(b)
 
$
618

 
$
683

(a) 
The change from December 31, 2017 primarily reflects the reclassification of $538 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and a decrease due to foreign exchange, partially offset by increases for certain products to meet targeted levels in the normal course of business, primarily for inventory build for supply recovery, new product launches and the movement of products within our manufacturing network.
(b) 
Included in Other noncurrent assets. There are no recoverability issues associated with these amounts.
v3.10.0.1
Property, Plant and Equipment (Tables)
 12 Months Ended
Dec. 31, 2018
Property, Plant and Equipment [Abstract]  
Schedule of Components of Property, Plant and Equipment
The following table provides the components of Property, plant and equipment:
 
 
Useful Lives
 
As of December 31,
(MILLIONS OF DOLLARS)
 
(Years)  
 
2018

 
2017

Land
 
-
 
$
500

 
$
540

Buildings
 
33-50
 
9,920

 
10,254

Machinery and equipment
 
8-20
 
11,871

 
11,902

Furniture, fixtures and other
 
3-12 1/2
 
4,693

 
4,661

Construction in progress
 
-
 
2,992

 
2,680

 
 
 
 
29,977

 
30,037

Less: Accumulated depreciation
 
 
 
16,591

 
16,172

Property, plant and equipment(a)
 
 
 
$
13,385

 
$
13,865

(a) 
The decrease in total property, plant and equipment is primarily due to depreciation, the reclassification of $675 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C), reductions due to asset impairments largely associated with cost reduction initiatives not associated with acquisitions (see Note 3), and the impact of foreign exchange, partially offset by capital additions.
v3.10.0.1
Identifiable Intangible Assets and Goodwill (Tables)
 12 Months Ended
Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Finite-Lived Intangible Assets
The following table provides the components of Identifiable intangible assets:
 
 
December 31, 2018
 
December 31, 2017
(MILLIONS OF DOLLARS)
 
Gross
Carrying
Amount

 
Accumulated
Amortization

 
Identifiable
Intangible
Assets, less
Accumulated
Amortization

 
Gross
Carrying
Amount

 
Accumulated
Amortization

 
Identifiable
Intangible
Assets, less
Accumulated
Amortization

Finite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Developed technology rights(a)
 
$
89,430

 
$
(58,895
)
 
$
30,535

 
$
89,550

 
$
(54,785
)
 
$
34,765

Brands(a)
 
923

 
(708
)
 
215

 
2,134

 
(1,152
)
 
982

Licensing agreements and other
 
1,436

 
(1,140
)
 
296

 
1,911

 
(1,096
)
 
815

 
 
91,788

 
(60,743
)
 
31,045

 
93,595

 
(57,033
)
 
36,562

Indefinite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Brands and other(a)
 
1,994

 


 
1,994

 
6,929

 


 
6,929

IPR&D(a)
 
2,171

 


 
2,171

 
5,249

 


 
5,249

 
 
4,165

 


 
4,165

 
12,179

 


 
12,179

Identifiable intangible assets(b)
 
$
95,954

 
$
(60,743
)
 
$
35,211

 
$
105,774

 
$
(57,033
)
 
$
48,741

(a) 
The changes in the gross carrying amount of Developed technology rights, Brands, Brands and other and IPR&D primarily reflect (i) the reclassification of $6.1 billion of Brands and Brands and other to Assets held for sale during the fourth quarter of 2018 (see Note 2C), (ii) the transfer of $2.7 billion from IPR&D to Developed technology rights to reflect the approval of Xtandi in the U.S. for the treatment of men with non-metastatic castration-resistant prostate cancer, which is being developed through a collaboration with Astellas (see Note 2A), (iii) $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E), as well as impairments of $2.9 billion of Developed technology rights (see Note 4).
(b) 
The decrease in Identifiable intangible assets, less accumulated amortization, is primarily due to the reclassification of $5.8 billion of intangible assets, net, ($6.3 billion total gross carrying amount) to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and amortization and impairments, partially offset by additions, mainly consisting of $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E).
Our identifiable intangible assets are associated with the following, as a percentage of total identifiable intangible assets, less accumulated amortization:
 
 
December 31, 2018
 
 
IH
 
EH
 
WRD
Developed technology rights
 
76
%
 
24
%
 
—

Brands, finite-lived
 
—

 
100
%
 
—

Brands, indefinite-lived
 
—

 
100
%
 
—

IPR&D
 
65
%
 
18
%
 
17
%
Schedule of Indefinite-Lived Intangible Assets
The following table provides the components of Identifiable intangible assets:
 
 
December 31, 2018
 
December 31, 2017
(MILLIONS OF DOLLARS)
 
Gross
Carrying
Amount

 
Accumulated
Amortization

 
Identifiable
Intangible
Assets, less
Accumulated
Amortization

 
Gross
Carrying
Amount

 
Accumulated
Amortization

 
Identifiable
Intangible
Assets, less
Accumulated
Amortization

Finite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Developed technology rights(a)
 
$
89,430

 
$
(58,895
)
 
$
30,535

 
$
89,550

 
$
(54,785
)
 
$
34,765

Brands(a)
 
923

 
(708
)
 
215

 
2,134

 
(1,152
)
 
982

Licensing agreements and other
 
1,436

 
(1,140
)
 
296

 
1,911

 
(1,096
)
 
815

 
 
91,788

 
(60,743
)
 
31,045

 
93,595

 
(57,033
)
 
36,562

Indefinite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Brands and other(a)
 
1,994

 


 
1,994

 
6,929

 


 
6,929

IPR&D(a)
 
2,171

 


 
2,171

 
5,249

 


 
5,249

 
 
4,165

 


 
4,165

 
12,179

 


 
12,179

Identifiable intangible assets(b)
 
$
95,954

 
$
(60,743
)
 
$
35,211

 
$
105,774

 
$
(57,033
)
 
$
48,741

(a) 
The changes in the gross carrying amount of Developed technology rights, Brands, Brands and other and IPR&D primarily reflect (i) the reclassification of $6.1 billion of Brands and Brands and other to Assets held for sale during the fourth quarter of 2018 (see Note 2C), (ii) the transfer of $2.7 billion from IPR&D to Developed technology rights to reflect the approval of Xtandi in the U.S. for the treatment of men with non-metastatic castration-resistant prostate cancer, which is being developed through a collaboration with Astellas (see Note 2A), (iii) $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E), as well as impairments of $2.9 billion of Developed technology rights (see Note 4).
(b) 
The decrease in Identifiable intangible assets, less accumulated amortization, is primarily due to the reclassification of $5.8 billion of intangible assets, net, ($6.3 billion total gross carrying amount) to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and amortization and impairments, partially offset by additions, mainly consisting of $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E).
Our identifiable intangible assets are associated with the following, as a percentage of total identifiable intangible assets, less accumulated amortization:
 
 
December 31, 2018
 
 
IH
 
EH
 
WRD
Developed technology rights
 
76
%
 
24
%
 
—

Brands, finite-lived
 
—

 
100
%
 
—

Brands, indefinite-lived
 
—

 
100
%
 
—

IPR&D
 
65
%
 
18
%
 
17
%
Schedule of Expected Amortization Expense
The following table provides the annual amortization expense expected for the years 2019 through 2023:
(MILLIONS OF DOLLARS)
 
2019

 
2020

 
2021

 
2022

 
2023

Amortization expense
 
$
4,581

 
$
3,552

 
$
3,467

 
$
3,217

 
$
2,920
Schedule of Goodwill
The following table provides the components of and changes in the carrying amount of Goodwill:
(MILLIONS OF DOLLARS)
 
IH

 
EH

 
Total

Balance, January 1, 2017
 
$
30,134

 
$
24,315

 
$
54,449

Additions(a)
 
572

 
92

 
664

Other(b)
 
435

 
404

 
840

Balance, December 31, 2017
 
31,141

 
24,811

 
55,952

Other(c)
 
(2,264
)
 
(277
)
 
(2,541
)
Balance, December 31, 2018
 
$
28,877

 
$
24,534

 
$
53,411

(a) 
IH additions primarily represent measurement period adjustments related to our Medivation acquisition, and EH additions relate to our acquisition of AstraZeneca’s small molecule anti-infectives business (see Note 2A).
(b) 
Primarily reflects the impact of foreign exchange and an adjustment of our estimate of goodwill associated with the HIS net assets sold.
(c) 
Primarily reflects the impact of the reclassification of $2.0 billion to Assets held for sale during the fourth quarter of 2018 (see Note 2C), foreign exchange and the contribution of the allogeneic CAR T developmental program assets and operations to Allogene that constituted a business for accounting purposes (see Note 2B).
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans (Tables)
 12 Months Ended
Dec. 31, 2018
Retirement Benefits [Abstract]  
Schedule of Net Periodic Benefit Costs
The following table provides the annual (income)/cost and changes in Other comprehensive income/(loss) for our benefit plans:
 
 
Year Ended December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S.
Qualified(a)
 
U.S.
Supplemental
(Non-Qualified)
 
International
 
Postretirement
Plans
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

Service cost(b)
 
$
—

 
$
269

 
$
257

 
$
—

 
$
24

 
$
18

 
$
136

 
$
171

 
$
165

 
$
39

 
$
42

 
$
41

Interest cost
 
598

 
634

 
646

 
55

 
54

 
53

 
212

 
204

 
233

 
72

 
90

 
101

Expected return on plan assets
 
(1,040
)
 
(1,005
)
 
(958
)
 
—

 
—

 
—

 
(360
)
 
(345
)
 
(381
)
 
(37
)
 
(36
)
 
(34
)
Amortization of:
 
 

 
 

 
 
 
 

 
 

 
 
 
 

 
 

 
 
 
 

 
 

 
 
Actuarial losses(b)
 
120

 
393

 
395

 
13

 
50

 
37

 
101

 
116

 
93

 
7

 
31

 
32

Prior service cost/(credits)
 
2

 
3

 
5

 
(1
)
 
(1
)
 
(1
)
 
(4
)
 
(4
)
 
(3
)
 
(178
)
 
(182
)
 
(174
)
Curtailments
 
12

 
13

 
10

 
1

 
1

 
1

 
(4
)
 
—

 
(2
)
 
(17
)
 
(19
)
 
(26
)
Settlements
 
113

 
75

 
90

 
26

 
39

 
28

 
4

 
4

 
9

 
—

 
—

 
—

Special termination benefits
 
6

 
—

 
—

 
10

 
—

 
—

 
—

 
1

 
1

 
2

 
—

 
—

Net periodic benefit costs/(income) reported in Income(c)
 
(189
)
 
382

 
444

 
103

 
166

 
137

 
84

 
147

 
115

 
(111
)
 
(75
)
 
(59
)
(Income)/cost reported in Other comprehensive income/(loss)(d)
 
361

 
141

 
253

 
(189
)
 
23

 
121

 
84

 
(301
)
 
640

 
105

 
(8
)
 
3

(Income)/cost recognized in Comprehensive income
 
$
171

 
$
523

 
$
697

 
$
(86
)
 
$
189

 
$
258

 
$
168

 
$
(154
)
 
$
755

 
$
(6
)
 
$
(83
)
 
$
(56
)
(a) 
In the second quarter of 2017, we settled the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. We purchased a group annuity contract on behalf of the remaining plan participants with a third-party insurance provider. As a result, we were relieved of the $156 million net pension benefit obligation and recorded a pretax settlement gain of $41 million, partially offset by the recognition of actuarial losses and prior service costs upon plan settlement of approximately $30 million in Other (income)/deductions—net (see Note 3).
(b) 
Effective January 1, 2018, we froze two significant defined benefit pension plans to future benefit accruals in the U.S. and U.K. and as a result, service costs for those plans are eliminated. In addition, due to the plan freeze, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans was extended to the expected life expectancy of the plan participants, whereas the average amortization period in prior years utilized the expected future service period of plan participants.
(c) 
We adopted a new accounting standard on January 1, 2018 that requires the net periodic pension and postretirement benefit costs other than service costs be presented in Other (income)/deductions––net on the consolidated statements of income. For additional information, see Note 1B and Note 4.
(d) 
In 2017 and 2016, the changes to Other comprehensive (income)/loss for the international plans was impacted by foreign currency movements. For details of the changes in Other comprehensive (income)/loss, see the benefit plan activity in the consolidated statements of comprehensive income.
Schedule of Amounts in Accumulated Other Comprehensive Income/(Loss) Expected to be Amortized into 2014 Net Periodic Benefit Costs
The following table provides the amounts in Accumulated other comprehensive loss expected to be amortized into 2019 net periodic benefit costs:
  
 
Pension Plans
 
  
(MILLIONS OF DOLLARS)
 
U.S.
Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International 
 
Postretirement Plans
Actuarial losses(a)
 
$
(148
)
 
$
(9
)
 
$
(81
)
 
$
(4
)
Prior service credits and other
 
3

 
1

 
3

 
178

Total
 
$
(145
)
 
$
(9
)
 
$
(78
)
 
$
175


(a) 
Due to the U.S. Pfizer Consolidated Pension Plan freeze effective for January 1, 2018, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans reflect the expected life expectancy of the plan participants, whereas prior years utilized the expected future service period of plan participants. The average amortization periods to be utilized for 2019 are 24.2 years for our U.S. qualified plans, 25.3 years for our U.S. supplemental (non-qualified) plans, 20 years for our international plans, and 9.3 years for our postretirement plans.
Schedule of Assumptions Used
The following table provides the weighted-average actuarial assumptions of our benefit plans:
(PERCENTAGES)
 
2018
 
2017
 
2016
Weighted-average assumptions used to determine benefit obligations
 
 
 
 
 
 
Discount rate:
 
 
 
 
 
 
U.S. qualified pension plans
 
4.4%
 
3.8%
 
4.3%
U.S. non-qualified pension plans
 
4.3%
 
3.7%
 
4.2%
International pension plans
 
2.5%
 
2.3%
 
2.4%
Postretirement plans
 
4.3%
 
3.7%
 
4.2%
Rate of compensation increase:
 
 
 
 
 
 
U.S. qualified pension plans(a)
 
—
 
2.8%
 
2.8%
U.S. non-qualified pension plans(a)
 
—
 
2.8%
 
2.8%
International pension plans
 
1.4%
 
2.5%
 
2.6%
Weighted-average assumptions used to determine net periodic benefit cost
 
 
 
 
 
 
Discount rate:
 
 
 
 
 
 
U.S. qualified pension plans
 
3.8%
 
4.3%
 
4.5%
U.S. non-qualified pension plans
 
3.7%
 
4.2%
 
4.5%
International pension plans interest cost(b)
 
2.0%
 
2.1%
 
2.7%
International pension plans service cost(b)
 
2.3%
 
2.3%
 
3.0%
Postretirement plans
 
3.7%
 
4.2%
 
4.5%
Expected return on plan assets:
 
 
 
 
 
 
U.S. qualified pension plans
 
7.5%
 
8.0%
 
8.0%
International pension plans
 
4.4%
 
4.7%
 
5.2%
Postretirement plans
 
7.5%
 
8.0%
 
8.0%
Rate of compensation increase:
 
 
 
 
 
 
U.S. qualified pension plans
 
2.8%
 
2.8%
 
2.8%
U.S. non-qualified pension plans
 
2.8%
 
2.8%
 
2.8%
International pension plans
 
2.5%
 
2.6%
 
2.6%

(a) 
Effective January 1, 2018, we froze the defined benefit plans to future benefit accruals in the U.S. and members’ accrued benefits to that date no longer increase in line with future compensation increases. The rate of compensation increase is therefore no longer an assumption used to determine the benefit obligation.
(b) 
Effective January 1, 2016, the Company changed the approach used to measure service cost and interest costs for certain international pension plans and other postretirement benefits. In accordance with this change, the effective rate for interest on the benefit obligations and effective rate for service cost, respectively, are reported for international pension plans.
Schedule of Health Care Cost Trend Rates
The following table provides the healthcare cost trend rate assumptions for our U.S. postretirement benefit plans:
 
 
2018

 
2017

Healthcare cost trend rate assumed for next year (up to age 65)
 
5.8
%
 
6.1
%
Healthcare cost trend rate assumed for next year (age 65 and older)
 
6.5
%
 
7.0
%
Rate to which the cost trend rate is assumed to decline
 
4.5
%
 
4.5
%
Year that the rate reaches the ultimate trend rate
 
2037

 
2037


The following table provides the effects as of December 31, 2018 of a one-percentage-point increase or decrease in the healthcare cost trend rate assumed for postretirement benefits:
(MILLIONS OF DOLLARS)
 
Increase

 
Decrease

Effect on total service and interest cost components
 
$
3

 
$
(2
)
Effect on postretirement benefit obligation
 
35

 
(27
)
Schedule of Effect of One-Percentage-Point Change in Assumed Health Care Cost Trend Rates
The following table provides the effects as of December 31, 2018 of a one-percentage-point increase or decrease in the healthcare cost trend rate assumed for postretirement benefits:
(MILLIONS OF DOLLARS)
 
Increase

 
Decrease

Effect on total service and interest cost components
 
$
3

 
$
(2
)
Effect on postretirement benefit obligation
 
35

 
(27
)
Schedule of Analysis of the Changes in the Benefit Obligations, Plan assets and Accounting Funded Status of Pension and Postretirement Benefit Plans
The following table provides an analysis of the changes in our benefit obligations, plan assets and funded status of our benefit plans:
  
 
Year Ended December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S. Qualified(a)
 
U.S. Supplemental
(Non-Qualified)
 
International(b)
 
Postretirement
Plans(c)
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Change in benefit obligation(d)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit obligation, beginning
 
$
16,702

 
$
15,547

 
$
1,495

 
$
1,450

 
$
10,607

 
$
9,691

 
$
2,028

 
$
2,254

Service cost
 
—

 
269

 
—

 
24

 
136

 
171

 
39

 
42

Interest cost
 
598

 
634

 
55

 
54

 
212

 
204

 
72

 
90

Employee contributions
 
—

 
—

 
—

 
—

 
7

 
6

 
102

 
94

Plan amendments
 
(22
)
 
—

 
—

 
—

 
29

 
2

 
2

 
—

Changes in actuarial assumptions and other
 
(1,219
)
 
1,614

 
(152
)
 
110

 
(169
)
 
135

 
(122
)
 
(177
)
Foreign exchange impact
 
—

 
—

 
—

 
—

 
(457
)
 
760

 
(4
)
 
5

Acquisitions/divestitures/other, net
 
—

 
—

 
—

 
—

 
(2
)
 
26

 
—

 
1

Curtailments
 
11

 
11

 
1

 
—

 
(3
)
 
—

 
(1
)
 
1

Settlements
 
(391
)
 
(842
)
 
(72
)
 
(98
)
 
(34
)
 
(31
)
 
—

 
—

Special termination benefits
 
6

 
—

 
10

 
—

 
—

 
1

 
2

 
—

Benefits paid
 
(546
)
 
(530
)
 
(58
)
 
(45
)
 
(373
)
 
(357
)
 
(249
)
 
(280
)
Benefit obligation, ending(d)
 
15,141

 
16,702

 
1,280

 
1,495

 
9,952

 
10,607

 
1,870

 
2,028

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Change in plan assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets, beginning
 
14,284

 
12,556

 
—

 
—

 
8,863

 
7,683

 
494

 
458

Actual gain/(loss) on plan assets
 
(796
)
 
2,005

 
—

 
—

 
(77
)
 
811

 
(22
)
 
39

Company contributions
 
500

 
1,095

 
129

 
143

 
209

 
160

 
145

 
183

Employee contributions
 
—

 
—

 
—

 
—

 
7

 
6

 
102

 
94

Foreign exchange impact
 
—

 
—

 
—

 
—

 
(380
)
 
561

 
—

 
—

Acquisitions/divestitures, net
 
—

 
—

 
—

 
—

 
—

 
30

 
—

 
—

Settlements
 
(391
)
 
(842
)
 
(72
)
 
(98
)
 
(34
)
 
(31
)
 
—

 
—

Benefits paid
 
(546
)
 
(530
)
 
(58
)
 
(45
)
 
(373
)
 
(357
)
 
(249
)
 
(280
)
Fair value of plan assets, ending
 
13,051

 
14,284

 
—

 
—

 
8,215

 
8,863

 
469

 
494

Funded status—Plan assets less than benefit obligation
 
$
(2,089
)
 
$
(2,418
)
 
$
(1,280
)
 
$
(1,495
)
 
$
(1,738
)
 
$
(1,745
)
 
$
(1,401
)
 
$
(1,534
)
(a)
The favorable change in the funded status of our U.S. qualified plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
(b) 
The favorable change in the international plans’ funded status was primarily due to favorable currency movements, partially offset by a decrease in the actual return on plan assets.
(c) 
The favorable change in the funded status of our postretirement plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
(d) 
For the U.S. and international pension plans, the benefit obligation is the PBO. For the postretirement plans, the benefit obligation is the ABO. The ABO for all of our U.S. qualified pension plans was $15.1 billion in 2018 and $16.7 billion in 2017. The ABO for our U.S. supplemental (non-qualified) pension plans was $1.3 billion in 2018 and $1.5 billion in 2017. The ABO for our international pension plans was $9.5 billion in 2018 and $10.1 billion in 2017.
Schedule of Amounts Recognized in Balance Sheet
The following table provides information as to how the funded status is recognized in our consolidated balance sheets:
  
 
As of December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S. Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International
 
Postretirement
Plans
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Noncurrent assets(a)
 
$
—

 
$
—

 
$
—

 
$
—

 
$
401

 
$
454

 
$
—

 
$
—

Current liabilities(b)
 
(1
)
 
—

 
(167
)
 
(160
)
 
(28
)
 
(26
)
 
(29
)
 
(31
)
Noncurrent liabilities(c)
 
(2,088
)
 
(2,418
)
 
(1,113
)
 
(1,336
)
 
(2,111
)
 
(2,172
)
 
(1,371
)
 
(1,504
)
Funded status
 
$
(2,089
)
 
$
(2,418
)
 
$
(1,280
)
 
$
(1,495
)
 
$
(1,738
)
 
$
(1,745
)
 
$
(1,401
)
 
$
(1,534
)
(a) 
Included primarily in Other noncurrent assets.
(b) 
Included in Accrued compensation and related items.
(c) 
Included in Pension benefit obligations, net and Postretirement benefit obligations, net, as appropriate.
Schedule of Amounts Recognized in Accumulated Other Comprehensive Income (Loss)
The following table provides the pre-tax components of cumulative amounts recognized in Accumulated other comprehensive loss:
 
 
As of December 31,
 
 
Pension Plans
 
 
 
 
 
 
U.S. Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International
 
Postretirement
Plans
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Actuarial losses(a)
 
$
(5,061
)
 
$
(4,677
)
 
$
(370
)
 
$
(561
)
 
$
(2,372
)
 
$
(2,322
)
 
$
(202
)
 
$
(293
)
Prior service (costs)/credits
 
1

 
(23
)
 
1

 
1

 
—

 
34

 
994

 
1,190

Total
 
$
(5,060
)
 
$
(4,699
)
 
$
(370
)
 
$
(559
)
 
$
(2,372
)
 
$
(2,288
)
 
$
792

 
$
897

(a) 
The accumulated actuarial losses primarily represent the impact of changes in discount rates and other assumptions that result in cumulative changes in our PBO, as well as the cumulative difference between the expected return and actual return on plan assets. These accumulated actuarial losses are recognized in Accumulated other comprehensive loss and are amortized into net periodic benefit costs primarily over the average remaining service period for active participants for plans that are not frozen or the expected life expectancy of plan participants for frozen plans, using the corridor approach.
Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets
The following table provides information related to the funded status of selected benefit plans:
 
 
As of December 31,
 
 
Pension Plans
 
 
U.S. Qualified
 
U.S. Supplemental (Non-Qualified)
 
International
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Pension plans with an ABO in excess of plan assets:
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets
 
$
13,051

 
$
14,284

 
$
—

 
$
—

 
$
4,514

 
$
882

ABO
 
15,141

 
16,702

 
1,280

 
1,495

 
6,286

 
2,724

Pension plans with a PBO in excess of plan assets:
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets
 
13,051

 
14,284

 
—

 
—

 
5,432

 
1,626

PBO
 
15,141

 
16,702

 
1,280

 
1,495

 
7,571

 
3,825
Schedule of Accumulated Benefit Obligations in Excess of Fair Value of Plan Assets
The following table provides information related to the funded status of selected benefit plans:
 
 
As of December 31,
 
 
Pension Plans
 
 
U.S. Qualified
 
U.S. Supplemental (Non-Qualified)
 
International
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

 
2018

 
2017

Pension plans with an ABO in excess of plan assets:
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets
 
$
13,051

 
$
14,284

 
$
—

 
$
—

 
$
4,514

 
$
882

ABO
 
15,141

 
16,702

 
1,280

 
1,495

 
6,286

 
2,724

Pension plans with a PBO in excess of plan assets:
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets
 
13,051

 
14,284

 
—

 
—

 
5,432

 
1,626

PBO
 
15,141

 
16,702

 
1,280

 
1,495

 
7,571

 
3,825
Schedule of Allocation of Plan Assets
The following table provides the components of plan assets:
  
 
  
 
Fair Value(a)
 
 
 
  
 
Fair Value(a)
 
 
(MILLIONS OF DOLLARS)
 
As of
December 31,
2018

 
Level 1
 
Level 2
 
Level 3
 
Assets Measured at NAV(b)

 
As of
December 31,
2017

 
Level 1
 
Level 2
 
Level 3
 
Assets Measured at NAV(b)

U.S. qualified pension plans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
443

 
$
53

 
$
390

 
$
—

 
$
—

 
$
655

 
$
115

 
$
540

 
$
—

 
$
—

Equity securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Global equity securities
 
3,156

 
3,119

 
37

 
—

 
—

 
4,157

 
4,118

 
38

 
1

 
—

Equity commingled funds
 
933

 
—

 
634

 
—

 
299

 
1,194

 
—

 
802

 
—

 
392

Fixed income securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Corporate debt securities
 
4,654

 
1

 
4,650

 
3

 
—

 
4,250

 
5

 
4,242

 
3

 
—

Government and agency obligations
 
1,391

 
—

 
1,391

 
—

 
—

 
1,316

 
—

 
1,316

 
—

 
—

Fixed income commingled funds
 
96

 
—

 
—

 
—

 
96

 
94

 
—

 
—

 
—

 
94

Other investments:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Partnership investments(c)
 
1,165

 
—

 
—

 
—

 
1,165

 
1,197

 
—

 
—

 
—

 
1,197

Insurance contracts
 
192

 
—

 
192

 
—

 
—

 
215

 
—

 
215

 
—

 
—

Other commingled funds(d)
 
1,021

 
—

 
—

 
—

 
1,021

 
1,206

 
—

 
—

 
—

 
1,206

Total
 
$
13,051

 
$
3,173

 
$
7,294

 
$
3

 
$
2,581

 
$
14,284

 
$
4,238

 
$
7,153

 
$
4

 
$
2,889

International pension plans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
246

 
$
39

 
$
208

 
$
—

 
$
—

 
$
385

 
$
48

 
$
337

 
$
—

 
$
—

Equity securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Global equity securities
 
2

 
2

 
—

 
—

 
—

 
154

 
146

 
8

 
—

 
—

Equity commingled funds
 
1,876

 
—

 
1,413

 
—

 
463

 
2,897

 
—

 
1,594

 
—

 
1,303

Fixed income securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Corporate debt securities
 
727

 
—

 
727

 
—

 
—

 
588

 
—

 
588

 
—

 
—

Government and agency obligations(e)
 
1,305

 
—

 
1,305

 
—

 
—

 
716

 
—

 
716

 
—

 
—

Fixed income commingled funds
 
1,770

 
—

 
1,007

 
—

 
762

 
2,181

 
—

 
1,340

 
—

 
841

Other investments:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Partnership investments(c)
 
57

 
—

 
4

 
—

 
53

 
42

 
—

 
7

 
—

 
35

Insurance contracts(f)
 
759

 
—

 
74

 
684

 
1

 
496

 
—

 
75

 
420

 
1

Other(d), (f)
 
1,473

 
—

 
71

 
382

 
1,020

 
1,404

 
—

 
408

 
468

 
528

Total
 
$
8,215

 
$
40

 
$
4,809

 
$
1,065

 
$
2,300

 
$
8,863

 
$
194

 
$
5,073

 
$
887

 
$
2,709

U.S. postretirement plans(g)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Equity securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Global equity securities
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Equity commingled funds
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Fixed income securities:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Corporate debt securities
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Government and agency obligations
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Fixed income commingled funds
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Other investments:
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

Partnership investments(c)
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Insurance contracts
 
469

 
—

 
469

 
—

 
—

 
494

 
—

 
494

 
—

 
—

Other commingled funds(d)
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total
 
$
469

 
$
—

 
$
469

 
$
—

 
$
—

 
$
494

 
$
—

 
$
494

 
$
—

 
$
—

(a)
Fair values are determined based on valuation inputs categorized as Level 1, 2 or 3 (see Note 1E).
(b)
Certain investments that are measured at NAV per share (or its equivalent) have not been classified in the fair value hierarchy. The NAV amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented for the total pension benefits plan assets.
(c) 
Primarily includes investments in private equity, private debt, public equity limited partnerships, and, to a lesser extent, real estate and venture capital.
(d) 
Primarily includes, for U.S. plan assets, investments in hedge funds and, to a lesser extent, real estate and, for international plan assets, investments in real estate and hedge funds.
(e) 
Government and agency obligations are inclusive of repurchase agreements.
(f) 
See below for a tabular analysis of the changes in Level 3 investments valued using significant unobservable inputs.
(g) 
Reflects postretirement plan assets, which support a portion of our U.S. retiree medical plans.
The following table provides the long-term target asset allocations ranges and the percentage of the fair value of plan assets for benefit plans:
  
 
As of December 31,
  
 
Target
Allocation Percentage

 
Percentage of Plan Assets
(PERCENTAGES)
 
2018

 
2018

 
2017

U.S. qualified pension plans
 
 
 
 
 
 
Cash and cash equivalents
 
0-10%

 
3.4
%
 
4.6
%
Equity securities
 
35-55%

 
31.3
%
 
37.5
%
Fixed income securities
 
28-53%

 
47.1
%
 
39.6
%
Other investments(a)
 
5-20%

 
18.2
%
 
18.3
%
Total
 
100
%
 
100
%
 
100
%
International pension plans
 
 
 
 
 
 
Cash and cash equivalents
 
0-10%

 
3.0
%
 
4.3
%
Equity securities
 
20-40%

 
22.9
%
 
34.4
%
Fixed income securities
 
35-60%

 
46.3
%
 
39.3
%
Other investments
 
10-35%

 
27.9
%
 
21.9
%
Total
 
100
%
 
100
%
 
100
%
U.S. postretirement plans
 
 
 
 
 
 
Cash and cash equivalents
 
0-5%

 
—

 
—

Equity securities
 
—

 
—

 
—

Fixed income securities
 
—

 
—

 
—

Other investments
 
95-100%

 
100
%
 
100
%
Total
 
100
%
 
100
%
 
100
%
(a) 
Actual percentage of plan assets in Other investments for 2018 includes $192 million, as compared to $215 million in 2017, related to a group fixed annuity insurance contract that was executed by legacy Wyeth for certain members of its defined benefit plans prior to Pfizer acquiring the company in 2009, and $177 million in 2018, as compared to $253 million in 2017, related to an investment in a partnership whose primary holdings are public equity securities. 
Schedule of Effect of Significant Unobservable Inputs, Changes in Plan Assets
The following table provides an analysis of the changes in our more significant investments valued using significant unobservable inputs:
 
 
Year Ended December 31,
 
 
International Pension Plans
 
 
Insurance contracts
 
Other
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2018

 
2017

Fair value, beginning
 
$
420

 
$
254

 
$
468

 
$
324

Actual return on plan assets:
 
 
 

 


 

Assets held, ending
 
1

 
1

 
15

 
18

Assets sold during the period
 
—

 
—

 
—

 
1

Purchases, sales, and settlements, net
 
188

 
138

 
(31
)
 
94

Transfer into/(out of) Level 3
 
107

 
—

 
(51
)
 
—

Exchange rate changes
 
(31
)
 
27

 
(20
)
 
30

Fair value, ending
 
$
684

 
$
420

 
$
382

 
$
468
Schedule of Expected Future Cash Flow Information
The following table provides the expected future cash flow information related to our benefit plans:
  
 
Pension Plans
 
 
(MILLIONS OF DOLLARS)
 
U.S. Qualified
 
U.S. Supplemental
(Non-Qualified)
 
International
 
Postretirement Plans
Expected employer contributions:
 
 
 
 
 
 
 
 
2019
 
$
11

 
$
167

 
$
177

 
$
160

Expected benefit payments:
 
 
 
 
 
 
 
 
2019
 
$
1,387

 
$
167

 
$
354

 
$
166

2020
 
1,089

 
121

 
372

 
171

2021
 
1,058

 
114

 
380

 
171

2022
 
1,020

 
113

 
385

 
168

2023
 
1,018

 
103

 
387

 
165

2024–2028
 
4,837

 
445

 
2,068

 
777
v3.10.0.1
Equity (Tables)
 12 Months Ended
Dec. 31, 2018
Equity [Abstract]  
Summary of Common Stock Purchases
The following table provides the number of shares of our common stock purchased and the cost of purchases under our publicly announced share-purchase plans, including our accelerated share repurchase agreements:
(SHARES IN MILLIONS, DOLLARS IN BILLIONS)
 
2018(a)

 
2017(b)

 
2016(c)

Shares of common stock purchased
 
307

 
150

 
154

Cost of purchase
 
$
12.2

 
$
5.0

 
$
5.0

(a) 
Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on March 12, 2018, as well as other share repurchases. See above for additional information.
(b) 
Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on February 2, 2017. See above for additional information.
(c) 
Represents shares purchased pursuant to the accelerated share repurchase agreement entered into on March 8, 2016. See above for additional information.
v3.10.0.1
Share-Based Payments (Tables)
 12 Months Ended
Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs
The following table provides the components of share-based compensation expense and the associated tax benefit:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

TSRUs(a)
 
$
302

 
$
221

 
$
134

RSUs
 
286

 
301

 
299

PPSs
 
276

 
209

 
135

PSAs
 
62

 
47

 
13

Stock options
 
12

 
55

 
106

Directors’ compensation
 
10

 
7

 
4

Share-based payment expense
 
949

 
840

 
691

Tax benefit for share-based compensation expense(b)
 
(180
)
 
(163
)
 
(205
)
Share-based payment expense, net of tax
 
$
769

 
$
677

 
$
486


(a) 
Includes $7.0 million of expense for PTSRUs.
(b) 
2018 and 2017 include the impact of the TCJA on income taxes.
Schedule of Share-based Payment Award, Stock Appreciation Rights, Valuation Assumptions
The following table provides the weighted-average assumptions used in the valuation of TSRUs:  
 
 
Year Ended December 31,
2018

 
2017

 
2016

Expected dividend yield(a)
 
3.73
%
 
3.69
%
 
3.85
%
Risk-free interest rate(b)
 
2.60
%
 
1.98
%
 
1.31
%
Expected stock price volatility(c)
 
20.00
%
 
18.39
%
 
21.64
%
Contractual term (years)
 
5.12

 
5.11

 
5.12

(a) 
Determined using a constant dividend yield during the expected term of the TSRU.
(b) 
Determined using the interpolated yield on U.S. Treasury zero-coupon issues.
(c) 
Determined using implied volatility, after consideration of historical volatility.
Schedule of Share-based Compensation, Stock Appreciation Rights Award Activity
The following table summarizes all TSRU activity during 2018:
 
 
TSRUs
(Thousands)

 
Weighted-Average
Grant-Date
Fair Value
Per TSRU

 
Weighted-Average
Grant Price
Per TSRU

Nonvested, December 31, 2017
 
103,906

 
$
6.07

 
$
32.47

Granted
 
47,755

 
7.42

 
35.75

Vested(a)
 
(7,203
)
 
6.67

 
34.49

Forfeited
 
(5,512
)
 
6.55

 
33.88

Nonvested, December 31, 2018
 
138,945

 
$
6.48

 
$
33.44

(a) 
Includes the modification of approximately 1.7 million TSRUs to approximately 260 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
The following table summarizes TSRU and PTU information as of December 31, 2018(a), (b):
 
 
TSRUs
(Thousands)

 
PTUs
(Thousands)

 
Weighted-Average
Grant Price
Per TSRU

 
Weighted-Average
Remaining Contractual Term (Years)
 
Aggregate Intrinsic Value (Millions)

TSRUs Outstanding
 
156,534

 
—

 
$
33.09

 
3.1
 
$
2,073

TSRUs Vested(c)
 
17,588

 
—

 
30.30

 
1.5
 
332

TSRUs Expected to vest(d)
 
133,878

 
—

 
33.38

 
3.2
 
1,688

TSRUs exercised and converted to PTUs
 
—

 
1,385

 
$
—

 
0.5
 
$
60

(a) 
In 2018, we settled 7,643,846 TSRUs with a weighted-average grant price of $23.13 per unit.
(b) 
In 2018, 2,809,652 TSRUs with a weighted-average grant price of $27.86 per unit were converted into 1,408,622 PTUs.
(c) 
Includes the modification of approximately 1.7 million TSRUs to approximately 260 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
(d) 
The number of TSRUs expected to vest takes into account an estimate of expected forfeitures.
The following table provides data related to all TSRU activity:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS, EXCEPT PER TSRU AMOUNTS)
 
2018

 
2017

 
2016

Weighted-average grant-date fair value per TSRU
 
$
7.42

 
$
6.23

 
$
5.83

Total compensation cost related to nonvested TSRU grants not yet recognized, pre-tax
 
$
246

 
$
232

 
$
164

Weighted-average period over which TSRU cost is expected to be recognized (years)
 
1.6

 
1.7

 
1.9
Schedule of Nonvested Restricted Stock Units Activity
The following table summarizes all RSU activity during 2018:
 
 
Shares 
(Thousands)

 
Weighted-Average
Grant-Date Fair Value
Per Share

Nonvested, December 31, 2017
 
22,241

 
$
32.64

Granted
 
9,083

 
35.90

Vested(a)
 
(3,701
)
 
34.02

Reinvested dividend equivalents
 
974

 
38.96

Forfeited
 
(1,321
)
 
33.85

Nonvested, December 31, 2018
 
27,276

 
$
33.70

(a) 
Includes the modification of approximately 150 thousand RSUs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit vesting upon termination. The impact to the compensation expense was immaterial.
The following table provides data related to all RSU activity:
(MILLIONS OF DOLLARS)
 
Year Ended December 31,
2018

 
2017

 
2016

Total fair value of shares vested(a)
 
$
146

 
$
584

 
$
293

Total compensation cost related to nonvested RSU awards not yet recognized, pre-tax
 
$
256

 
$
254

 
$
262

Weighted-average period over which RSU cost is expected to be recognized (years)
 
1.7

 
1.7

 
1.7

(a) 
2018 includes modification of approximately 150 thousand RSUs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit vesting upon termination. The impact to the compensation expense was immaterial. 2017 includes the modification for a commitment to pay approximately 6.4 million RSUs to approximately 9,900 employees, including senior and key management employees, for 6.6 million RSUs. These shares were paid in the first quarter of 2018.
Schedule of Nonvested Performance-based Units Activity
The following table summarizes all PSA activity during 2018, with the shares granted representing the maximum award that could be achieved:
 
 
Shares 
(Thousands)

 
Weighted-Average
Intrinsic Value
Per Share

Nonvested, December 31, 2017
 
4,024

 
$
36.22

Granted
 
1,833

 
35.74

Vested(a)
 
(112
)
 
39.58

Forfeited
 
(463
)
 
37.12

Nonvested, December 31, 2018
 
5,282

 
$
43.65

(a) 
Includes the modification of a few PSAs to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
The following table provides data related to all PSA activity:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018
 
2017
 
2016
Total fair value of shares vested(a)
 
$
4

 
$
58

 
$
9

Total compensation cost related to nonvested PSA grants not yet recognized, pre-tax
 
$
41

 
$
34

 
$
30

Weighted-average period over which PSA cost is expected to be recognized (years)
 
1.8

 
1.8

 
1.8


(a) 
Includes the 2018 modification of a few PSAs to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial. Includes the 2017 modification for a commitment to pay 1.1 million PSAs to approximately 90 employees, including senior and key management employees, for 1.1 million PSAs. These shares were paid in the first quarter of 2018.
The following table summarizes all PPS activity during 2018, with the shares representing the maximum award that could be achieved:
 
 
Shares 
(Thousands)

 
Weighted-Average
Intrinsic Value
Per Share

Nonvested, December 31, 2017
 
20,973

 
$
36.22

Granted
 
6,769

 
35.74

Vested(a)
 
(7,483
)
 
37.31

Forfeited
 
(998
)
 
38.23

Nonvested, December 31, 2018(b)
 
19,261

 
$
43.65

(a)
Includes the modification of approximately 200 thousand PPSs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
(b) 
Vested and non-vested shares outstanding, but not paid as of December 31, 2018 were 33.9 million.
The following table provides data related to all PPS activity:
(MILLIONS OF DOLLARS)
 
Year Ended December 31,
2018

 
2017

 
2016

Total fair value of shares vested(a)
 
$
169

 
$
131

 
$
118

Total compensation cost related to nonvested PPS awards not yet recognized, pre-tax
 
$
102

 
$
94

 
$
93

Weighted-average period over which PPS cost is expected to be recognized (years)
 
1.8

 
1.7

 
1.8


(a) 
Includes the modification of approximately 200 thousand PPSs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
Schedule of Valuation Assumptions
The following table provides the weighted-average assumptions used in the valuation of stock options:
 
 
Year Ended December 31,
  
 
2018

 
2017

 
2016

Expected dividend yield(a)
 
3.73
%
 
3.69
%
 
3.85
%
Risk-free interest rate(b)
 
2.85
%
 
2.23
%
 
1.55
%
Expected stock price volatility(c)
 
20.02
%
 
18.39
%
 
21.64
%
Expected term (years)(d)
 
6.75

 
6.75

 
6.75

(a) 
Determined using a constant dividend yield during the expected term of the option.
(b) 
Determined using the interpolated yield on U.S. Treasury zero-coupon issues.
(c) 
Determined using implied volatility, after consideration of historical volatility.
(d) 
Determined using historical exercise and post-vesting termination patterns.
Schedule of Share-based Compensation, Stock Options, Activity
The following table summarizes all stock option activity during 2018:
 
 
Shares
(Thousands)

 
Weighted-Average
Exercise Price
Per Share

 
Weighted-Average
Remaining Contractual Term
(Years)
 
Aggregate
Intrinsic Value(a)
(Millions)

Outstanding, December 31, 2017
 
150,757

 
$
27.27

 
 
 
 
Granted
 
1,372

 
35.74

 
 
 
 
Exercised
 
(47,740
)
 
26.59

 
 
 
 
Forfeited
 
(219
)
 
33.96

 
 
 
 
Expired
 
(379
)
 
24.69

 
 
 
 
Outstanding, December 31, 2018(b)
 
103,791

 
27.69

 
4.4
 
$
1,657

Vested and expected to vest, December 31, 2018(c)
 
103,621

 
27.68

 
4.4
 
1,655

Exercisable, December 31, 2018
 
100,078

 
$
27.47

 
4.2
 
$
1,619

(a) 
Market price of our underlying common stock less exercise price.
(b) 
Includes the modification of approximately 190 thousand stock options to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit a longer exercise term after termination.
(c) 
The number of options expected to vest takes into account an estimate of expected forfeitures.
The following table summarizes data related to all stock option activity:
 
 
Year Ended December 31,
(MILLIONS OF DOLLARS, EXCEPT PER STOCK OPTION AMOUNTS)
 
2018

 
2017

 
2016

Weighted-average grant-date fair value per stock option
 
$
5.06

 
$
4.01

 
$
3.89

Aggregate intrinsic value on exercise
 
$
625

 
$
331

 
$
389

Cash received upon exercise
 
$
1,259

 
$
862

 
$
1,019

Tax benefits realized related to exercise
 
$
115

 
$
95

 
$
112

Total compensation cost related to nonvested stock options not yet recognized, pre-tax
 
$
5

 
$
10

 
$
58

Weighted-average period over which stock option compensation cost is expected to be recognized (years)
 
1.7

 
0.8

 
1.1
v3.10.0.1
Earnings Per Common Share Attributable to Pfizer Inc. Common Shareholders (Tables)
 12 Months Ended
Dec. 31, 2018
Earnings Per Share [Abstract]  
Schedule of Basic and Diluted Earning Per Share
The following table provides the detailed calculation of Earnings per common share (EPS):
 
 
Year Ended December 31,
(IN MILLIONS)
 
2018

 
2017

 
2016

EPS Numerator––Basic
 
 

 
 
 
 
Income from continuing operations
 
$
11,179

 
$
21,353

 
$
7,229

Less: Net income attributable to noncontrolling interests
 
36

 
47

 
31

Income from continuing operations attributable to Pfizer Inc.
 
11,143

 
21,306

 
7,198

Less: Preferred stock dividends––net of tax
 
1

 
1

 
1

Income from continuing operations attributable to Pfizer Inc. common shareholders
 
11,142

 
21,305

 
7,197

Discontinued operations––net of tax
 
10

 
2

 
17

Less: Discontinued operations––net of tax, attributable to noncontrolling interests
 
—

 
—

 
—

Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders
 
10

 
2

 
17

Net income attributable to Pfizer Inc. common shareholders
 
$
11,152

 
$
21,307

 
$
7,214

EPS Numerator––Diluted
 
 

 
 

 
 
Income from continuing operations attributable to Pfizer Inc. common shareholders and assumed conversions
 
$
11,143

 
$
21,306

 
$
7,197

Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders and assumed conversions
 
10

 
2

 
17

Net income attributable to Pfizer Inc. common shareholders and assumed conversions
 
$
11,153

 
$
21,308

 
$
7,214

EPS Denominator
 
 

 
 

 
 
Weighted-average number of common shares outstanding––Basic(a)
 
5,872

 
5,970

 
6,089

Common-share equivalents: stock options, stock issuable under employee compensation plans, convertible preferred stock and accelerated share repurchase agreements(a)
 
105

 
89

 
70

Weighted-average number of common shares outstanding––Diluted
 
5,977

 
6,058

 
6,159

Stock options that had exercise prices greater than the average market price of our common stock issuable under employee compensation plans(b)
 
2

 
36

 
63

Cash dividends declared per share
 
$
1.38

 
$
1.30

 
$
1.22

(a) 
2017 includes the effect of the modification for a commitment to pay 15.2 million common-share equivalents that were scheduled for near-term settlement. These common share equivalents were paid in the first quarter of 2018.
(b) 
These common stock equivalents were outstanding for the periods presented, but were not included in the computation of diluted EPS for those periods because their inclusion would have had an anti-dilutive effect.
v3.10.0.1
Lease Commitments (Tables)
 12 Months Ended
Dec. 31, 2018
Leases [Abstract]  
Schedule of Future Minimum Rental Commitments Under Non-Cancelable Operating Leases
The future minimum rental commitments under non-cancelable operating leases follow:
(MILLIONS OF DOLLARS)
 
2019

 
2020

 
2021

 
2022

 
2023

 
After 2023

Lease commitments
 
$
300

 
$
252

 
$
210

 
$
267

 
$
248

 
$
2,040
v3.10.0.1
Segment, Geographic and Other Revenue Information (Tables)
 12 Months Ended
Dec. 31, 2018
Segment Reporting [Abstract]  
Reconciliation of Revenue from Segments to Consolidated
The following table provides selected income statement information by reportable segment:
 
 
Revenues
 
Earnings(a)
 
Depreciation and Amortization(b)
 
 
Year Ended December 31,
 
Year Ended December 31,
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

Reportable Segments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
IH(c)
 
$
33,426

 
$
31,422

 
$
29,197

 
$
20,258

 
$
18,809

 
$
16,166

 
$
629

 
$
534

 
$
583

EH(c)
 
20,221

 
21,124

 
23,627

 
10,712

 
11,460

 
13,065

 
547

 
579

 
600

Total reportable segments
 
53,647

 
52,546

 
52,824

 
30,970

 
30,269

 
29,231

 
1,175

 
1,113

 
1,183

Other business activities(d), (e)
 
—

 
—

 
—

 
(2,977
)
 
(3,137
)
 
(3,020
)
 
93

 
90

 
85

Reconciling Items:
 
 

 
 

 


 
 

 
 

 


 


 


 


Corporate(c), (e)
 
—

 
—

 
—

 
(5,096
)
 
(5,452
)
 
(5,448
)
 
363

 
337

 
356

Purchase accounting adjustments(e)
 
—

 
—

 
—

 
(4,786
)
 
(4,758
)
 
(4,185
)
 
4,620

 
4,565

 
3,890

Acquisition-related costs(e)
 
—

 
—

 
—

 
(318
)
 
(456
)
 
(785
)
 
12

 
39

 
7

Certain significant items(f)
 
—

 
—

 
—

 
(4,305
)
 
(2,647
)
 
(5,888
)
 
38

 
52

 
200

Other unallocated(c), (e)
 
—

 
—

 
—

 
(1,603
)
 
(1,514
)
 
(1,554
)
 
82

 
72

 
35

 
 
$
53,647

 
$
52,546

 
$
52,824

 
$
11,885

 
$
12,305

 
$
8,351

 
$
6,384

 
$
6,269

 
$
5,757

(a) 
Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
(b) 
Certain production facilities are shared. Depreciation is allocated based on estimates of physical production. Amounts here relate solely to the depreciation and amortization associated with continuing operations.
(c) 
In connection with the StratCO reporting change, in 2017, we reclassified approximately $468 million of costs from IH, approximately $176 million of costs from EH and approximately $70 million of costs from Corporate to Other unallocated costs, and in 2016, we reclassified approximately $312 million of costs from IH, approximately $167 million of costs from EH and approximately $43 million of costs from Corporate to Other unallocated costs to conform to the current period presentation.
(d) 
Other business activities includes the costs managed by our WRD and GPD organizations.
(e) 
For a description, see the “Other Costs and Business Activities” section above.
(f) 
Certain significant items are substantive and/or unusual, and in some cases recurring, items (such as restructuring or legal charges) that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis.
For Earnings in 2018, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $977 million, (ii) net charges for certain legal matters of $157 million, (iii) income of $1 million, representing an adjustment to amounts previously recorded to write down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $3.1 billion, (v) charges for business and legal entity alignment of $4 million, (vi) net losses on early retirement of debt of $3 million and (vii) other charges of $65 million, which includes, among other things, a non-cash $343 million pre-tax gain in Other (income)/deductions––net associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system, a $119 million charge, in the aggregate, in Selling, informational and administrative expenses, for a special one-time bonus paid to virtually all Pfizer colleagues, excluding executives, which was one of several actions taken by us after evaluating the expected positive net impact of the December 2017 enactment of the legislation commonly referred to as the TCJA, $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily including consulting, legal, tax, and advisory services and a non-cash $50 million pre-tax gain in Other (income)/deductions––net as a result of the contribution of our allogeneic CAR T cell therapy development program assets in connection with our contribution agreement entered into with Allogene. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2017, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $204 million, (ii) charges for certain legal matters of $237 million, (iii) charges of $55 million, representing adjustments to amounts previously recorded to write-down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $379 million, (v) charges for business and legal entity alignment of $71 million, (vi) net losses on early retirement of debt of $999 million and (vii) other charges of $700 million. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $1.4 billion, (ii) charges for certain legal matters of $494 million, (iii) an impairment charge related to the write-down of the HIS net assets to fair value less estimated costs to sell of $1.7 billion, (iv) certain asset impairment charges of $1.4 billion, (v) charges for business and legal entity alignment of $261 million, (vi) net losses on early retirement of debt of $312 million and (vii) other charges of $294 million. For additional information, see Note 3 and Note 4.
Reconciliation of Operating Profit (Loss) from Segments to Consolidated
The following table provides selected income statement information by reportable segment:
 
 
Revenues
 
Earnings(a)
 
Depreciation and Amortization(b)
 
 
Year Ended December 31,
 
Year Ended December 31,
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

Reportable Segments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
IH(c)
 
$
33,426

 
$
31,422

 
$
29,197

 
$
20,258

 
$
18,809

 
$
16,166

 
$
629

 
$
534

 
$
583

EH(c)
 
20,221

 
21,124

 
23,627

 
10,712

 
11,460

 
13,065

 
547

 
579

 
600

Total reportable segments
 
53,647

 
52,546

 
52,824

 
30,970

 
30,269

 
29,231

 
1,175

 
1,113

 
1,183

Other business activities(d), (e)
 
—

 
—

 
—

 
(2,977
)
 
(3,137
)
 
(3,020
)
 
93

 
90

 
85

Reconciling Items:
 
 

 
 

 


 
 

 
 

 


 


 


 


Corporate(c), (e)
 
—

 
—

 
—

 
(5,096
)
 
(5,452
)
 
(5,448
)
 
363

 
337

 
356

Purchase accounting adjustments(e)
 
—

 
—

 
—

 
(4,786
)
 
(4,758
)
 
(4,185
)
 
4,620

 
4,565

 
3,890

Acquisition-related costs(e)
 
—

 
—

 
—

 
(318
)
 
(456
)
 
(785
)
 
12

 
39

 
7

Certain significant items(f)
 
—

 
—

 
—

 
(4,305
)
 
(2,647
)
 
(5,888
)
 
38

 
52

 
200

Other unallocated(c), (e)
 
—

 
—

 
—

 
(1,603
)
 
(1,514
)
 
(1,554
)
 
82

 
72

 
35

 
 
$
53,647

 
$
52,546

 
$
52,824

 
$
11,885

 
$
12,305

 
$
8,351

 
$
6,384

 
$
6,269

 
$
5,757

(a) 
Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
(b) 
Certain production facilities are shared. Depreciation is allocated based on estimates of physical production. Amounts here relate solely to the depreciation and amortization associated with continuing operations.
(c) 
In connection with the StratCO reporting change, in 2017, we reclassified approximately $468 million of costs from IH, approximately $176 million of costs from EH and approximately $70 million of costs from Corporate to Other unallocated costs, and in 2016, we reclassified approximately $312 million of costs from IH, approximately $167 million of costs from EH and approximately $43 million of costs from Corporate to Other unallocated costs to conform to the current period presentation.
(d) 
Other business activities includes the costs managed by our WRD and GPD organizations.
(e) 
For a description, see the “Other Costs and Business Activities” section above.
(f) 
Certain significant items are substantive and/or unusual, and in some cases recurring, items (such as restructuring or legal charges) that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis.
For Earnings in 2018, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $977 million, (ii) net charges for certain legal matters of $157 million, (iii) income of $1 million, representing an adjustment to amounts previously recorded to write down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $3.1 billion, (v) charges for business and legal entity alignment of $4 million, (vi) net losses on early retirement of debt of $3 million and (vii) other charges of $65 million, which includes, among other things, a non-cash $343 million pre-tax gain in Other (income)/deductions––net associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system, a $119 million charge, in the aggregate, in Selling, informational and administrative expenses, for a special one-time bonus paid to virtually all Pfizer colleagues, excluding executives, which was one of several actions taken by us after evaluating the expected positive net impact of the December 2017 enactment of the legislation commonly referred to as the TCJA, $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily including consulting, legal, tax, and advisory services and a non-cash $50 million pre-tax gain in Other (income)/deductions––net as a result of the contribution of our allogeneic CAR T cell therapy development program assets in connection with our contribution agreement entered into with Allogene. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2017, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $204 million, (ii) charges for certain legal matters of $237 million, (iii) charges of $55 million, representing adjustments to amounts previously recorded to write-down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $379 million, (v) charges for business and legal entity alignment of $71 million, (vi) net losses on early retirement of debt of $999 million and (vii) other charges of $700 million. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $1.4 billion, (ii) charges for certain legal matters of $494 million, (iii) an impairment charge related to the write-down of the HIS net assets to fair value less estimated costs to sell of $1.7 billion, (iv) certain asset impairment charges of $1.4 billion, (v) charges for business and legal entity alignment of $261 million, (vi) net losses on early retirement of debt of $312 million and (vii) other charges of $294 million. For additional information, see Note 3 and Note 4.
Reconciliation Of Depreciation And Amortization From Segments To Consolidated
The following table provides selected income statement information by reportable segment:
 
 
Revenues
 
Earnings(a)
 
Depreciation and Amortization(b)
 
 
Year Ended December 31,
 
Year Ended December 31,
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

 
2018

 
2017

 
2016

Reportable Segments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
IH(c)
 
$
33,426

 
$
31,422

 
$
29,197

 
$
20,258

 
$
18,809

 
$
16,166

 
$
629

 
$
534

 
$
583

EH(c)
 
20,221

 
21,124

 
23,627

 
10,712

 
11,460

 
13,065

 
547

 
579

 
600

Total reportable segments
 
53,647

 
52,546

 
52,824

 
30,970

 
30,269

 
29,231

 
1,175

 
1,113

 
1,183

Other business activities(d), (e)
 
—

 
—

 
—

 
(2,977
)
 
(3,137
)
 
(3,020
)
 
93

 
90

 
85

Reconciling Items:
 
 

 
 

 


 
 

 
 

 


 


 


 


Corporate(c), (e)
 
—

 
—

 
—

 
(5,096
)
 
(5,452
)
 
(5,448
)
 
363

 
337

 
356

Purchase accounting adjustments(e)
 
—

 
—

 
—

 
(4,786
)
 
(4,758
)
 
(4,185
)
 
4,620

 
4,565

 
3,890

Acquisition-related costs(e)
 
—

 
—

 
—

 
(318
)
 
(456
)
 
(785
)
 
12

 
39

 
7

Certain significant items(f)
 
—

 
—

 
—

 
(4,305
)
 
(2,647
)
 
(5,888
)
 
38

 
52

 
200

Other unallocated(c), (e)
 
—

 
—

 
—

 
(1,603
)
 
(1,514
)
 
(1,554
)
 
82

 
72

 
35

 
 
$
53,647

 
$
52,546

 
$
52,824

 
$
11,885

 
$
12,305

 
$
8,351

 
$
6,384

 
$
6,269

 
$
5,757

(a) 
Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
(b) 
Certain production facilities are shared. Depreciation is allocated based on estimates of physical production. Amounts here relate solely to the depreciation and amortization associated with continuing operations.
(c) 
In connection with the StratCO reporting change, in 2017, we reclassified approximately $468 million of costs from IH, approximately $176 million of costs from EH and approximately $70 million of costs from Corporate to Other unallocated costs, and in 2016, we reclassified approximately $312 million of costs from IH, approximately $167 million of costs from EH and approximately $43 million of costs from Corporate to Other unallocated costs to conform to the current period presentation.
(d) 
Other business activities includes the costs managed by our WRD and GPD organizations.
(e) 
For a description, see the “Other Costs and Business Activities” section above.
(f) 
Certain significant items are substantive and/or unusual, and in some cases recurring, items (such as restructuring or legal charges) that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis.
For Earnings in 2018, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $977 million, (ii) net charges for certain legal matters of $157 million, (iii) income of $1 million, representing an adjustment to amounts previously recorded to write down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $3.1 billion, (v) charges for business and legal entity alignment of $4 million, (vi) net losses on early retirement of debt of $3 million and (vii) other charges of $65 million, which includes, among other things, a non-cash $343 million pre-tax gain in Other (income)/deductions––net associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system, a $119 million charge, in the aggregate, in Selling, informational and administrative expenses, for a special one-time bonus paid to virtually all Pfizer colleagues, excluding executives, which was one of several actions taken by us after evaluating the expected positive net impact of the December 2017 enactment of the legislation commonly referred to as the TCJA, $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily including consulting, legal, tax, and advisory services and a non-cash $50 million pre-tax gain in Other (income)/deductions––net as a result of the contribution of our allogeneic CAR T cell therapy development program assets in connection with our contribution agreement entered into with Allogene. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2017, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $204 million, (ii) charges for certain legal matters of $237 million, (iii) charges of $55 million, representing adjustments to amounts previously recorded to write-down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $379 million, (v) charges for business and legal entity alignment of $71 million, (vi) net losses on early retirement of debt of $999 million and (vii) other charges of $700 million. For additional information, see Note 2B, Note 3 and Note 4.
For Earnings in 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $1.4 billion, (ii) charges for certain legal matters of $494 million, (iii) an impairment charge related to the write-down of the HIS net assets to fair value less estimated costs to sell of $1.7 billion, (iv) certain asset impairment charges of $1.4 billion, (v) charges for business and legal entity alignment of $261 million, (vi) net losses on early retirement of debt of $312 million and (vii) other charges of $294 million. For additional information, see Note 3 and Note 4.
Revenue from External Customers by Geographic Areas
As described in Note 1A, the February 3, 2017 sale of HIS impacted our results of operations in 2018, 2017 and 2016.
The following table provides revenues by geographic area:
 
Year Ended December 31,
(MILLIONS OF DOLLARS)
2018

 
2017

 
2016

United States
$
25,329

 
$
26,026

 
$
26,369

Developed Europe(a)
9,116

 
8,508

 
9,306

Developed Rest of World(b)
6,551

 
6,612

 
6,729

Emerging Markets (c)
12,651

 
11,399

 
10,420

Revenues
$
53,647

 
$
52,546

 
$
52,824


(a) 
Developed Europe region includes the following markets: Western Europe, Scandinavian countries and Finland. Revenues denominated in euros were $7.3 billion in 2018, $6.8 billion in 2017 and $7.2 billion in 2016.
(b) 
Developed Rest of World region includes the following markets: Japan, Canada, South Korea, Australia and New Zealand.
(c) 
Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Eastern Europe, Africa, the Middle East, Central Europe and Turkey.
Long-lived Assets by Geographic Areas
The following table provides long-lived assets by geographic area:
 
 
As of December 31,
(MILLIONS OF DOLLARS)
 
2018

 
2017

 
2016

Property, plant and equipment, net
 
 
 
 
 
 
United States
 
$
7,089

 
$
6,971

 
$
6,649

Developed Europe(a)
 
4,204

 
4,345

 
4,228

Developed Rest of World(b)
 
490

 
632

 
643

Emerging Markets(c)
 
1,602

 
1,917

 
1,797

Property, plant and equipment, net
 
$
13,385

 
$
13,865

 
$
13,318


(a) 
Developed Europe region includes the following markets: Western Europe, Scandinavian countries and Finland.
(b) 
Developed Rest of World region includes the following markets: Japan, Canada, South Korea, Australia and New Zealand.
(c) 
Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Eastern Europe, Africa, the Middle East, Central Europe and Turkey.
Schedule of Significant Product Revenues
As described in Note 1A, acquisitions and divestitures have impacted our results of operations in 2018, 2017 and 2016.
The following table provides detailed revenue information for several of our major products:
(MILLIONS OF DOLLARS)
 
 
 
Year Ended December 31,
PRODUCT
 
PRIMARY INDICATION OR CLASS
 
2018

 
2017

 
2016

TOTAL REVENUES
 
 
 
$
53,647

 
$
52,546

 
$
52,824

PFIZER INNOVATIVE HEALTH (IH)(a)
 
$
33,426

 
$
31,422

 
$
29,197

Internal Medicine
 
$
9,996

 
$
9,684

 
$
8,858

Lyrica IH(b)
 
Epilepsy, post-herpetic neuralgia and diabetic peripheral neuropathy, fibromyalgia, neuropathic pain due to spinal cord injury
 
4,622

 
4,511

 
4,165

Eliquis alliance revenues and direct sales
 
Atrial fibrillation, deep vein thrombosis, pulmonary embolism
 
3,434

 
2,523

 
1,713

Chantix/Champix
 
An aid to smoking cessation treatment in adults 18 years of age or older
 
1,085

 
997

 
842

BMP2
 
Development of bone and cartilage
 
279

 
261

 
251

Toviaz
 
Overactive bladder
 
271

 
257

 
258

Viagra IH(c)
 
Erectile dysfunction
 
—

 
823

 
1,181

All other Internal Medicine
 
Various
 
306

 
312

 
447

Vaccines
 
$
6,332

 
$
6,001

 
$
6,071

Prevnar 13/Prevenar 13
 
Vaccines for prevention of pneumococcal disease
 
5,802

 
5,601

 
5,718

FSME/IMMUN-TicoVac
 
Tick-borne encephalitis vaccine
 
184

 
134

 
114

Trumenba
 
Meningococcal Group B vaccine
 
116

 
88

 
84

All other Vaccines
 
Various
 
230

 
177

 
155

Oncology
 
$
7,202

 
$
6,056

 
$
4,563

Ibrance
 
Advanced breast cancer
 
4,118

 
3,126

 
2,135

Sutent
 
Advanced and/or metastatic RCC, adjuvant RCC, refractory GIST (after disease progression on, or intolerance to, imatinib mesylate) and advanced pancreatic neuroendocrine tumor
 
1,049

 
1,081

 
1,095

Xtandi alliance revenues
 
Castration-resistant prostate cancer
 
699

 
590

 
140

Xalkori
 
ALK-positive and ROS1-positive advanced NSCLC
 
524

 
594

 
561

Inlyta
 
Advanced RCC
 
298

 
339

 
401

Bosulif
 
Philadelphia chromosome–positive chronic myelogenous leukemia
 
296


233


167

All other Oncology
 
Various
 
219

 
93

 
63

Inflammation & Immunology (I&I)
 
$
4,080

 
$
3,968

 
$
3,928

Enbrel (Outside the U.S. and Canada)
 
RA, juvenile idiopathic arthritis, PsA, plaque psoriasis, pediatric plaque psoriasis, ankylosing spondylitis and nonradiographic axial spondyloarthritis
 
2,112

 
2,452

 
2,909

Xeljanz
 
RA, PsA, ulcerative colitis
 
1,774

 
1,345

 
927

Eucrisa
 
Mild-to-moderate atopic dermatitis (eczema)
 
147


67


—

All other I&I
 
Various
 
46

 
103

 
93

Rare Disease
 
$
2,211

 
$
2,240

 
$
2,369

Genotropin
 
Replacement of human growth hormone
 
558

 
532

 
579

BeneFIX
 
Hemophilia
 
554

 
604

 
712

Refacto AF/Xyntha
 
Hemophilia
 
514

 
551

 
554

Somavert
 
Acromegaly
 
267

 
254

 
232

All other Rare Disease
 
Various
 
318

 
300

 
292

Consumer Healthcare
 
 
 
$
3,605

 
$
3,472

 
$
3,407

PFIZER ESSENTIAL HEALTH (EH)(d)
 
$
20,221

 
$
21,124

 
$
23,627

Legacy Established Products (LEP)(e)
 
$
10,540

 
$
10,894

 
$
11,197

Lipitor
 
Reduction of LDL cholesterol
 
2,062

 
1,915

 
1,758

Norvasc
 
Hypertension
 
1,024

 
926

 
962

Premarin family
 
Symptoms of menopause
 
832

 
977

 
1,017

Xalatan/Xalacom
 
Glaucoma and ocular hypertension
 
318

 
335

 
363

Effexor
 
Depression and certain anxiety disorders
 
311

 
297

 
278

EpiPen
 
Epinephrine injection used in treatment of life-threatening allergic reactions
 
303

 
290

 
386

Zoloft
 
Depression and certain anxiety disorders
 
298

 
291

 
304

Zithromax
 
Bacterial infections
 
290

 
270

 
272

Xanax
 
Anxiety disorders
 
223

 
225

 
222

Sildenafil Citrate
 
Erectile dysfunction
 
56

 
56

 
—

All other LEP
 
Various
 
4,822

 
5,313

 
5,636

(MILLIONS OF DOLLARS)
 
 
 
Year Ended December 31,
PRODUCT
 
PRIMARY INDICATION OR CLASS
 
2018

 
2017

 
2016

Sterile Injectable Pharmaceuticals (SIP)(f)
 
$
5,214

 
$
5,673

 
$
6,014

Sulperazon
 
Treatment of infections
 
613

 
471

 
396

Medrol
 
Steroid anti-inflammatory
 
427

 
483

 
450

Fragmin
 
Slows blood clotting
 
293

 
306

 
318

Tygacil
 
Tetracycline class antibiotic
 
249

 
260

 
274

Zosyn/Tazocin
 
Antibiotic
 
229

 
194

 
146

Precedex
 
Sedation agent in surgery or intensive care
 
213

 
243

 
264

All other SIP
 
Various
 
3,191

 
3,715

 
4,166

Peri-LOE Products(g)
 
$
2,944

 
$
3,223

 
$
4,220

Celebrex
 
Arthritis pain and inflammation, acute pain
 
686

 
775

 
733

Viagra EH(c)
 
Erectile dysfunction
 
636

 
382

 
383

Vfend
 
Fungal infections
 
392

 
421

 
590

Lyrica EH(b)
 
Epilepsy, neuropathic pain and generalized anxiety disorder
 
347

 
553

 
801

Zyvox
 
Bacterial infections
 
236

 
281

 
421

Revatio
 
Pulmonary arterial hypertension
 
227

 
252

 
285

Pristiq
 
Depression
 
206

 
303

 
732

All other Peri-LOE Products
 
Various
 
213

 
257

 
276

Biosimilars(h)
 
Various
 
$
769

 
$
531

 
$
319

Inflectra/Remsima
 
Inflammatory diseases
 
642

 
419

 
192

All other Biosimilars
 
Various
 
127

 
112

 
127

Pfizer CentreOne(i)
 
 
 
$
755

 
$
706

 
$
718

Hospira Infusion Systems (HIS)(j)
 
Various
 
$
—

 
$
97

 
$
1,158

Total Lyrica(b)
 
Epilepsy, post-herpetic neuralgia and diabetic peripheral neuropathy, fibromyalgia, neuropathic pain due to spinal cord injury
 
$
4,970

 
$
5,065

 
$
4,966

Total Viagra(c)
 
Erectile dysfunction
 
$
636

 
$
1,204

 
$
1,564

Total Alliance revenues
 
Various
 
$
3,838

 
$
2,927

 
$
1,746

(a) 
The IH business encompasses Internal Medicine, Vaccines, Oncology, Inflammation & Immunology, Rare Disease and Consumer Healthcare. Through December 31, 2016, includes Duavive/Duavee and Viviant (recorded in All other Internal Medicine in 2016), which were transferred from Innovative Health to Essential Health effective January 1, 2017 (recorded in All other LEP (EH) beginning January 1, 2017), in order to align these products with our management of the women’s health portfolio within EH.
(b) 
Lyrica revenues from all of Europe, Russia, Turkey, Israel and Central Asia countries are included in Lyrica EH. All other Lyrica revenues are included in Lyrica IH. Total Lyrica revenues represent the aggregate of worldwide revenues from Lyrica IH and Lyrica EH.
(c) 
Viagra lost exclusivity in the U.S. in December 2017. In 2018, revenues for Viagra in the U.S. and Canada, which were reported in IH through 2017, were reported in EH (which reported all other Viagra revenues excluding the U.S. and Canada through 2017). Therefore, in 2018, total Viagra worldwide revenues were reported in EH. Total Viagra revenues in 2017 and 2016 represented the aggregate of worldwide revenues from Viagra IH and Viagra EH.
(d) 
The EH business encompasses Legacy Established Products, Sterile Injectable Pharmaceuticals, Peri-LOE Products, Biosimilars, Pfizer CentreOne and HIS (through February 2, 2017).
(e) 
Legacy Established Products primarily include products that have lost patent protection (excluding Sterile Injectable Pharmaceuticals and Peri-LOE Products). In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
Effective January 1, 2017, All other LEP includes Duavive/Duavee and Viviant, which were transferred from Innovative Health (recorded in All other Internal Medicine (IH) in 2016), in order to align these products with our management of the women’s health portfolio within EH. See note (a) above.
(f) 
Sterile Injectable Pharmaceuticals includes branded and generic injectables (excluding Peri-LOE Products). In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
(g) 
Peri-LOE Products include products that have recently lost or are anticipated to soon lose patent protection. These products primarily include: Lyrica in Europe, Russia, Turkey, Israel and Central Asia; and worldwide revenues for Celebrex, Pristiq, Zyvox, Vfend, Revatio and Inspra; and in 2018, Viagra revenues for all countries (and Viagra revenues for all countries other than the U.S. and Canada in 2017 and 2016), see note (c) above.
(h) 
Biosimilars include Inflectra/Remsima (biosimilar infliximab) in the U.S. and certain international markets, Nivestim (biosimilar filgrastim) in certain European, Asian and Africa/Middle Eastern markets and in the U.S. and Retacrit (biosimilar epoetin zeta) in the U.S. and certain European and Africa/Middle Eastern markets.
(i) 
Pfizer CentreOne includes revenues from our contract manufacturing and active pharmaceutical ingredient sales operation, including sterile injectables contract manufacturing, and revenues related to our manufacturing and supply agreements, including with Zoetis Inc. In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
(j) 
HIS (through February 2, 2017) includes Medication Management Systems products composed of infusion pumps and related software and services, as well as IV Infusion Products, including large volume IV solutions and their associated administration sets.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies - Additional Information (Details)
$ / shares in Units, $ in Millions
 3 Months Ended 12 Months Ended 33 Months Ended
Jan. 01, 2018
USD ($)
Accounting_standard
Dec. 22, 2016
USD ($)
Sep. 28, 2016
USD ($)
$ / shares
Jun. 24, 2016
USD ($)
$ / shares
Apr. 08, 2016
USD ($)
Apr. 01, 2018
USD ($)
Dec. 31, 2018
USD ($)
Operating_Segment
Dec. 31, 2017
USD ($)
Dec. 31, 2016
USD ($)
Dec. 31, 2018
USD ($)
Operating_Segment
Feb. 03, 2017
USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Number of operating segments | Operating_Segment             2     2  
Number of accounting standards adopted | Accounting_standard 11                    
Cash payments for acquisition, net of cash acquired [1]             $ 0 $ 1,000 $ 18,368    
Payments for merger termination costs         $ 150       150    
Unrealized gain on equity securities             477        
Other income/(deductions)—net [2]             (2,116) (1,416) (3,794)    
Decrease in cash, cash equivalents, restricted cash and cash equivalents [1]             205 1,235 1,041    
Accruals for Medicare rebates, Medicaid and related state program rebates, performance-based contract rebates, chargebacks, sales allowances, cash discounts and sales returns             5,426 4,923   $ 5,426  
Advertising expense             3,100 3,100 3,200    
Research and development expenses [2],[3]             8,006 7,683 7,892    
Nonsoftware License Arrangement [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Research and development expenses             197 169 82    
AstraZeneca [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Consideration transferred   $ 1,040                  
Payments to acquire businesses, cash portion   $ 555           605      
Medivation [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Business acquisition, per share in cash (in dollars per share) | $ / shares     $ 81.5                
Payments to acquire businesses, cash portion     $ 14,300                
Cash payments for acquisition, net of cash acquired     $ 13,900                
Anacor [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Business acquisition, per share in cash (in dollars per share) | $ / shares       $ 99.25              
Payments to acquire businesses, cash portion       $ 4,900              
Cash payments for acquisition, net of cash acquired       4,500              
Debt assumed       $ 698              
ICU Medical [Member] | Disposed of by Sale, Not Discontinued Operations [Member] | HIS [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cash received for disposition                     $ 900
Sales Revenue, Product Line [Member] | Top Ten Products [Member] | Product Concentration Risk [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Concentration risk, amount             $ 1,000        
Concentration risk, percentage             51.00%        
Sales Revenue, Product Line [Member] | Top Nine Products [Member] | Product Concentration Risk [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Concentration risk, amount               $ 1,000 $ 1,000    
Concentration risk, percentage               46.00% 43.00%    
Financial Assets and Liabilities [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, before tax $ 462                    
Cumulative effect on retained earnings, net of tax 419                    
Unrealized gain on equity securities             $ 477        
Accounting for Hedging Activities [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Other income/(deductions)—net             107        
Restricted Cash [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Decrease in cash, cash equivalents, restricted cash and cash equivalents             2        
Reclassification From Financing Activities To Operating Activities [Member] | Cash Flow Classification [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Decrease in debt prepayment and extinguishment costs             7        
Reclassification From Operating Activities To Financing Activities [Member] | Cash Flow Classification [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Increase in accreted interest             $ 83        
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Revenues [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, before tax 584         $ 584          
Cumulative effect on retained earnings, net of tax 450                    
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Revenues [Member] | Collaboration Arrangements [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, before tax 500                    
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Revenues [Member] | Collaboration Arrangements, Income From Upfront And Pre-Approval Milestone Payments [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, before tax 394                    
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Revenues [Member] | Collaboration Arrangements, Product Manufacturing [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, before tax 82                    
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Revenues [Member] | Product Rights And Out-Licensing Arrangements [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, before tax 394                    
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Revenues [Member] | Product Shipments [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, before tax 84                    
Retained Earnings [Member] | Income Tax Accounting [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, net of tax (189)                    
Retained Earnings [Member] | Reclassification of Certain Tax Effects from AOCI [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cumulative effect on retained earnings, net of tax $ 495                    
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
[3] Exclusive of amortization of intangible assets, except as disclosed in Note 1L. Basis of Presentation and Significant Accounting Policies: Amortization of Intangible Assets, Depreciation and Certain Long-Lived Assets.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies - Impact of Adoption of Pension and Postretirement Benefit Costs Accounting Standard (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Cost of sales [1],[2] $ 11,248 $ 11,228 $ 12,322
Selling, informational and administrative expenses [1],[2] 14,455 14,804 14,844
Research and development expenses [1],[2] 8,006 7,683 7,892
Restructuring charges and certain acquisition-related costs [1] 1,044 351 1,565
Other (income)/deductions––net [1] 2,116 1,416 3,794
Income from continuing operations before provision for taxes on income [1],[3],[4],[5] $ 11,885 12,305 8,351
As Previously Reported [Member]      
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Cost of sales   11,240 12,329
Selling, informational and administrative expenses   14,784 14,837
Research and development expenses   7,657 7,872
Restructuring charges and certain acquisition-related costs   487 1,724
Other (income)/deductions––net   1,315 3,655
Income from continuing operations before provision for taxes on income   12,305 8,351
Accounting Standards Update 2017-07 [Member] | Effect of Change Higher/(Lower) [Member]      
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Cost of sales   (12) (7)
Selling, informational and administrative expenses   20 7
Research and development expenses   27 20
Restructuring charges and certain acquisition-related costs   (136) (159)
Other (income)/deductions––net   101 139
Income from continuing operations before provision for taxes on income   $ 0 $ 0
[1] Amounts may not add due to rounding.
[2] Exclusive of amortization of intangible assets, except as disclosed in Note 1L. Basis of Presentation and Significant Accounting Policies: Amortization of Intangible Assets, Depreciation and Certain Long-Lived Assets.
[3] 2017 v. 2016––The decrease in the domestic loss was primarily due to lower restructuring charges and certain acquisition-related costs, the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower certain asset impairments and lower certain legal matters, partially offset by higher net losses on early retirement of debt, and higher amortization of intangible assets. The increase in international income was primarily due to the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower restructuring charges and certain acquisition-related costs, and lower certain asset impairments.
[4] 2018 v. 2017––The decrease in the domestic loss was primarily due to lower interest expense paid to certain foreign subsidiaries, lower net losses on the retirement of debt, higher net gains on investments in equity securities and increased revenue related to Eliquis, partially offset by higher certain asset impairments and lower revenue for Viagra and the SIP portfolio. The decrease in international income was primarily related to lower interest income received primarily from intercompany borrowings from Pfizer Inc. and higher charges related to certain cost reduction initiatives, partially offset by increased revenue related to Ibrance and Eliquis.
[5] Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies - Impact of Adoption of Accounting Standards on Consolidated Balance Sheet (Details) - USD ($)
$ in Millions
Dec. 31, 2018
 [1]
Jan. 01, 2018
Dec. 31, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Trade accounts receivable $ 8,025 $ 8,234 $ 8,221 [1]
Inventories 7,508 7,567 7,578 [1]
Current tax assets 3,374 3,036 3,050 [1]
Noncurrent deferred tax assets and other noncurrent tax assets 1,924 1,838 1,855 [1]
Other noncurrent assets 2,799 3,023 3,227 [1]
Other current liabilities 10,753 10,992 11,115 [1]
Noncurrent deferred tax liabilities 3,700 3,988 3,900 [1]
Other noncurrent liabilities 5,850 5,690 6,149 [1]
Retained earnings 89,554 86,466 85,291 [1]
Accumulated other comprehensive loss $ (11,275) $ (10,235) (9,321) [1]
As Previously Reported [Member]      
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Trade accounts receivable     8,221
Inventories     7,578
Current tax assets     3,050
Noncurrent deferred tax assets and other noncurrent tax assets     1,855
Other noncurrent assets     3,227
Other current liabilities     11,115
Noncurrent deferred tax liabilities     3,900
Other noncurrent liabilities     6,149
Retained earnings     85,291
Accumulated other comprehensive loss     (9,321)
Effect of Change Higher/(Lower) [Member] | Revenues [Member]      
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Trade accounts receivable     13
Inventories     (11)
Current tax assets     (11)
Noncurrent deferred tax assets and other noncurrent tax assets     (17)
Other noncurrent assets     0
Other current liabilities     (123)
Noncurrent deferred tax liabilities     106
Other noncurrent liabilities     (459)
Retained earnings     450
Accumulated other comprehensive loss     0
Effect of Change Higher/(Lower) [Member] | Financial Assets and Liabilities [Member]      
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Trade accounts receivable     0
Inventories     0
Current tax assets     0
Noncurrent deferred tax assets and other noncurrent tax assets     0
Other noncurrent assets     0
Other current liabilities     0
Noncurrent deferred tax liabilities     0
Other noncurrent liabilities     0
Retained earnings     419
Accumulated other comprehensive loss     (419)
Effect of Change Higher/(Lower) [Member] | Income Tax Accounting [Member]      
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Trade accounts receivable     0
Inventories     0
Current tax assets     (3)
Noncurrent deferred tax assets and other noncurrent tax assets     0
Other noncurrent assets     (204)
Other current liabilities     0
Noncurrent deferred tax liabilities     (18)
Other noncurrent liabilities     0
Retained earnings     (189)
Accumulated other comprehensive loss     0
Effect of Change Higher/(Lower) [Member] | Reclassification of Certain Tax Effects from AOCI [Member]      
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Trade accounts receivable     0
Inventories     0
Current tax assets     0
Noncurrent deferred tax assets and other noncurrent tax assets     0
Other noncurrent assets     0
Other current liabilities     0
Noncurrent deferred tax liabilities     0
Other noncurrent liabilities     0
Retained earnings     495
Accumulated other comprehensive loss     $ (495)
[1] Amounts may not add due to rounding.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies - Impact of Adoption of Accounting Standards Related to Classification of Certain Transactions in the Statement of Cash Flows (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Operating Activities      
Other adjustments, net [1] $ (1,268) $ 344 $ 487
Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets [1] (16) 7 (47)
Investing Activities      
Proceeds from redemptions/sales of short-term investments [1] 17,581 10,302 29,414
Proceeds from redemptions/sales of long-term investments [1] 6,244 3,579 11,268
Other investing activities, net [1],[2] 288 671 80
Financing Activities      
Principal payments on short-term borrowings [1] (4,437) (9,947) (5,093)
Net (payments on)/proceeds from short-term borrowings with original maturities of three months or less [1] (1,617) 1,422 (3,060)
Other financing activities, net [1] (588) (611) (536)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents [1] (205) (1,235) (1,041)
Cash and cash equivalents and restricted cash and cash equivalents, beginning [1] 1,431 2,666 3,707
Cash and cash equivalents and restricted cash and cash equivalents, end [1] 1,225 1,431 2,666
As Previously Reported [Member]      
Operating Activities      
Other adjustments, net   50 208
Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets   (31) (60)
Investing Activities      
Proceeds from redemptions/sales of short-term investments   10,307 29,436
Proceeds from redemptions/sales of long-term investments   3,594 11,254
Other investing activities, net   650 51
Financing Activities      
Principal payments on short-term borrowings   (9,990) (5,102)
Net (payments on)/proceeds from short-term borrowings with original maturities of three months or less   1,401 (3,084)
Other financing activities, net   (233) (196)
Net decrease in cash and cash equivalents and restricted cash and cash equivalents   (1,254) (1,046)
Cash and cash equivalents and restricted cash and cash equivalents, beginning 1,342 2,595 3,641
Cash and cash equivalents and restricted cash and cash equivalents, end   1,342 2,595
Cash Flow Classification [Member] | Effect of Change Higher/(Lower) [Member]      
Operating Activities      
Other adjustments, net   294 278
Investing Activities      
Other investing activities, net   21 28
Financing Activities      
Principal payments on short-term borrowings   43 9
Net (payments on)/proceeds from short-term borrowings with original maturities of three months or less   20 24
Other financing activities, net   (378) (340)
Restricted Cash [Member]      
Financing Activities      
Net decrease in cash and cash equivalents and restricted cash and cash equivalents (2)    
Restricted Cash [Member] | Effect of Change Higher/(Lower) [Member]      
Operating Activities      
Other changes in assets and liabilities, net of acquisitions and divestitures––Other assets   38 13
Investing Activities      
Proceeds from redemptions/sales of short-term investments   (5) (22)
Proceeds from redemptions/sales of long-term investments   (14) 14
Financing Activities      
Net decrease in cash and cash equivalents and restricted cash and cash equivalents   19 5
Cash and cash equivalents and restricted cash and cash equivalents, beginning $ 89 70 65
Cash and cash equivalents and restricted cash and cash equivalents, end   $ 89 $ 70
[1] Amounts may not add due to rounding.
[2] For additional information, see Note 2B. Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment: Divestitures.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies - Reconciliation of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Restricted Cash and Cash Equivalents Items [Line Items]        
Cash and cash equivalents [1] $ 1,139 $ 1,342    
Total cash and cash equivalents and restricted cash and cash equivalents shown in the consolidated balance sheets [2] 1,225 1,431 $ 2,666 $ 3,707
Short-term investments [Member]        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and cash equivalents 32 0    
Long-term investments [Member]        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and cash equivalents 55 0    
Other current assets [Member]        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and cash equivalents 0 14    
Other noncurrent assets [Member]        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and cash equivalents $ 0 $ 75    
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
v3.10.0.1
Basis of Presentation and Significant Accounting Policies - Accrued Rebates and Other Accruals (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Schedule Of Accrued Liabilities [Line Items]    
Accrued rebates and other accruals $ 5,426 $ 4,923
Trade accounts receivable [Member]    
Schedule Of Accrued Liabilities [Line Items]    
Accrued rebates and other accruals 1,288 1,352
Other current liabilities [Member]    
Schedule Of Accrued Liabilities [Line Items]    
Accrued rebates 3,208 2,674
Other accruals 531 512
Other noncurrent liabilities [Member]    
Schedule Of Accrued Liabilities [Line Items]    
Accrued rebates and other accruals $ 399 $ 385
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - AstraZeneca (Details) - USD ($)
 1 Months Ended 3 Months Ended 12 Months Ended
Dec. 22, 2016
Jan. 31, 2019
Apr. 01, 2018
Jul. 02, 2017
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Business Acquisition [Line Items]              
Goodwill         $ 53,411,000,000 [1] $ 55,952,000,000 [1] $ 54,449,000,000
AstraZeneca [Member]              
Business Acquisition [Line Items]              
Payments to acquire businesses, cash portion $ 555,000,000         $ 605,000,000  
Milestone payment     $ 125,000,000 $ 50,000,000      
Potential milestone payments         75,000,000    
Maximum amount of sales-related payments         600,000,000    
Consideration transferred 1,040,000,000            
Fair value of contingent consideration 485,000,000            
Intangible assets 894,000,000            
Other current assets 92,000,000            
Goodwill 73,000,000            
Net deferred tax liabilities 19,000,000            
Minimum [Member] | AstraZeneca [Member]              
Business Acquisition [Line Items]              
Royalty payments         327,000,000    
Maximum [Member] | AstraZeneca [Member]              
Business Acquisition [Line Items]              
Royalty payments         $ 553,000,000    
Developed Technology Rights [Member] | AstraZeneca [Member]              
Business Acquisition [Line Items]              
Intangible assets 728,000,000            
In Process Research and Development [Member] | AstraZeneca [Member]              
Business Acquisition [Line Items]              
Intangible assets $ 166,000,000            
Subsequent Event [Member] | AstraZeneca [Member]              
Business Acquisition [Line Items]              
Deferred payment   $ 175,000,000          
[1] Amounts may not add due to rounding.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - Medivation, Inc. (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended 15 Months Ended
Sep. 28, 2016
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2017
Business Acquisition [Line Items]          
Cash payments for acquisition, net of cash acquired [1]   $ 0 $ 1,000 $ 18,368  
Goodwill   53,411 [2] 55,952 [2] 54,449 $ 55,952 [2]
Medivation [Member]          
Business Acquisition [Line Items]          
Business acquisition, per share in cash (in dollars per share) $ 81.5        
Payments to acquire businesses, cash portion $ 14,300        
Cash payments for acquisition, net of cash acquired 13,900        
Acquisition consideration, amount payable       $ 365  
Intangible assets 12,200        
Goodwill 6,100        
Net deferred tax liabilities 4,000        
Assumed contingent consideration 259        
Contingent consideration paid   $ 35      
Reduction in identifiable intangible assets         $ 1,000
Decrease in amortization of intangible assets     $ 38    
Developed Technology Rights [Member] | Medivation [Member]          
Business Acquisition [Line Items]          
Intangible assets $ 8,100        
Acquired intangible assets, useful life 12 years        
In Process Research and Development [Member] | Medivation [Member]          
Business Acquisition [Line Items]          
Intangible assets $ 4,100        
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - Bamboo Therapeutics, Inc. (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Aug. 01, 2016
Oct. 02, 2016
Apr. 03, 2016
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Business Acquisition [Line Items]            
Cash payments for acquisition, net of cash acquired [1]       $ 0 $ 1,000 $ 18,368
Goodwill       $ 53,411 [2] $ 55,952 [2] $ 54,449
Bamboo Therapeutics [Member]            
Business Acquisition [Line Items]            
Total consideration transferred $ 150          
Potential milestone payments 495          
Consideration transferred, including equity interest held prior to business combination 343          
Payments to acquire businesses, cash portion 130   $ 43      
Cash payments for acquisition, net of cash acquired 101          
Assumed contingent consideration 167          
Fair value of previously held equity interest in acquiree 45          
Goodwill 142          
Net deferred tax liabilities 94          
Bamboo Therapeutics [Member] | Other Nonoperating Income (Expense) [Member]            
Business Acquisition [Line Items]            
Gain recognized   $ 2        
In Process Research and Development [Member] | Bamboo Therapeutics [Member]            
Business Acquisition [Line Items]            
Intangible assets $ 330          
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - Anacor Pharmaceuticals, Inc. (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Jun. 24, 2016
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Business Acquisition [Line Items]        
Cash payments for acquisition, net of cash acquired [1]   $ 0 $ 1,000 $ 18,368
Goodwill   $ 53,411 [2] $ 55,952 [2] $ 54,449
Anacor [Member]        
Business Acquisition [Line Items]        
Business acquisition, per share in cash (in dollars per share) $ 99.25      
Payments to acquire businesses, cash portion $ 4,900      
Cash payments for acquisition, net of cash acquired 4,500      
Debt assumed 698      
Indefinite-lived intangible assets 4,900      
Goodwill 646      
Net deferred tax liabilities 346      
In Process Research and Development [Member] | Anacor [Member]        
Business Acquisition [Line Items]        
Intangible assets $ 4,800      
[1] Amounts may not add due to rounding.
[2] Amounts may not add due to rounding.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - Divestitures (Details) - USD ($)
$ / shares in Units, shares in Millions
 1 Months Ended 3 Months Ended 12 Months Ended
Oct. 31, 2018
Sep. 30, 2018
Apr. 30, 2018
Dec. 31, 2018
Jul. 01, 2018
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2014
Feb. 03, 2017
Oct. 06, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Gain representing difference between fair value of equity investment and book value of assets transferred [2]           $ 586,000,000 [1] $ 224,000,000 $ 18,000,000      
Income (loss) on sale of assets [3],[4]           1,000,000 (55,000,000) (1,712,000,000)      
Equity securities       $ 1,600,000,000   1,600,000,000 2,150,000,000        
Disposal Group, Held-for-sale, Not Discontinued Operations [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Book value of assets transferred       9,725,000,000   9,725,000,000 12,000,000        
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | HIS [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Impairment charge for HIS net assets               $ 1,700,000,000      
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | Consumer Healthcare [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Book value of assets transferred       9,678,000,000   9,678,000,000 0        
Disposed of by Sale, Not Discontinued Operations [Member] | Phase 2b Ready AMPA Receptor Potentiator For CIAS [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cash and common stock to be received for disposition     $ 75,000,000 85,000,000   85,000,000          
Maximum amount of milestone payments to be received     $ 515,000,000                
ICU Medical [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | HIS [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cash and common stock to be received for disposition                     $ 1,000,000,000
ICU Medical [Member] | Disposed of by Sale, Not Discontinued Operations [Member] | HIS [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cash and common stock to be received for disposition                   $ 900,000,000  
Shares of common stock received for disposal                   3.2  
Value of common stock received for disposal                   $ 428,000,000  
Gain from sale of shares           302,000,000          
Gain representing difference between fair value of equity investment and book value of assets transferred           47,000,000          
Consideration receivable                   75,000,000  
Cash proceeds from disposal             200,000,000        
Maximum contingent consideration                   $ 225,000,000  
Income (loss) on sale of assets           1,000,000 $ (55,000,000) [5]        
Cellectis [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Ownership percentage                 7.00%    
Upfront payment                 $ 80,000,000    
Allogene [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Ownership percentage 18.00%   25.00%                
Gain from contribution agreement         $ 50,000,000 50,000,000          
Cerevel [Member] | Bain Capital [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Gain representing difference between fair value of equity investment and book value of assets transferred   $ 343,000,000       343,000,000          
Cerevel [Member] | Bain Capital [Member] | Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations [Member] | Neuroscience Assets [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Committed investment from collaborator       350,000,000   350,000,000          
Book value of assets transferred       0   0          
Long-term Investments [Member] | Allogene [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Equity securities       127,000,000   $ 127,000,000          
Allogene [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Share price (in dollars per share) $ 25                    
Other Nonoperating Income (Expense) [Member] | Disposed of by Sale, Not Discontinued Operations [Member] | Phase 2b Ready AMPA Receptor Potentiator For CIAS [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Cash and common stock to be received for disposition         $ 75,000,000            
Milestone payment recognized       $ 10,000,000              
Cerevel Therapeutics [Member] | Cerevel [Member]                      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]                      
Ownership percentage   25.00%                  
[1] The net gains on investments in equity securities are reported in Other (income)/deductions––net and, for 2018, include unrealized net gains on equity securities reflecting the adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 4.
[2] The net gains on investments in equity securities in 2018, include unrealized net gains on equity securities of $477 million, reflecting the adoption of a new accounting standard in the first quarter of 2018. Net gains in 2018 were primarily driven by unrealized gains of $466 million related to our investment in Allogene. Prior to the adoption of a new accounting standard in the first quarter of 2018, net unrealized gains and losses on virtually all equity securities with readily determinable fair values were reported in Accumulated other comprehensive income. For additional information, see Note 1B, Note 2B and Note 7B.
[3] Amounts may not add due to rounding.
[4] In 2018 and 2017, represents adjustments to amounts previously recorded in 2016 to write down the HIS net assets to fair value less costs to sell related to the sale of HIS net assets to ICU Medical on February 3, 2017. In 2016, represents a charge related to the write-down of the HIS net assets to fair value less estimated costs to sell. See Note 2B for additional information.
[5] Includes income from upfront and milestone payments from our collaboration partners and income from out-licensing arrangements and sales of compound/product rights. In 2018, primarily includes, among other things, (i) approximately $118 million in milestone income from multiple licensees, (ii) $110 million in milestone payments received from Shire, of which $75 million was received in the first quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of ulcerative colitis and $35 million was received from Shire in the third quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of Crohn’s disease, (iii) an upfront payment to us and a recognized milestone totaling $85 million for the sale of an AMPA receptor potentiator for CIAS to Biogen, (iv) $62 million in gains related to sales of compound/product rights and (v) a $40 million milestone payment from Merck in conjunction with the approval of ertugliflozin in the EU. For additional information, see Note 2B, Note 2C, Note 2D and Note 2E. In 2017, primarily includes, among other things, $101 million in milestone payments received from multiple licensees and an $85 million gain related to sales of compound/product rights. In 2016, primarily includes, among other things, a $50 million gain related to sales of compound/product rights and $33 million in milestone payments received from multiple licensees.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - GSK (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2019
Liabilities Held for Sale        
Total Consumer liabilities held for sale [1] $ 1,890 $ 0    
Disposal Group, Held-for-sale, Not Discontinued Operations [Member]        
Assets Held for Sale        
Assets held for sale 9,725 12    
Other assets held for sale [2] 46 12    
Consumer Healthcare [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member]        
Assets Held for Sale        
Cash and cash equivalents 32 0    
Trade accounts receivable, less allowance for doubtful accounts 532 0    
Inventories 538 0    
Other current assets 56 0    
PP&E 675 0    
Identifiable intangible assets, less accumulated amortization 5,763 0    
Goodwill 1,972 0    
Noncurrent deferred tax assets and other noncurrent tax assets 54 0    
Other noncurrent assets 57 0    
Assets held for sale 9,678 0    
Liabilities Held for Sale        
Trade accounts payable 406 0    
Income taxes payable 39 0    
Accrued compensation and related items 93 0    
Other current liabilities 353 0    
Pension benefit obligations, net 39 0    
Postretirement benefit obligations, net 33 0    
Noncurrent deferred tax liabilities 870 0    
Other noncurrent liabilities 56 0    
Total Consumer liabilities held for sale 1,890 0    
Pre-tax income attributable to disposal group $ 977 $ 863 $ 780  
GSK Consumer Healthcare [Member] | Forecast [Member]        
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]        
Equity method investment, ownership percentage       32.00%
GSK [Member] | GSK Consumer Healthcare [Member] | Forecast [Member]        
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]        
Equity method investment, ownership percentage       68.00%
[1] Amounts may not add due to rounding.
[2] Other assets held for sale consist of PP&E.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - Licensing Arrangements (Details) - Licensing Agreements [Member] - USD ($)
$ in Millions
 1 Months Ended 3 Months Ended 12 Months Ended
Sep. 30, 2018
Sep. 30, 2018
Apr. 01, 2018
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Proceeds from licensing arrangement         $ 101 $ 33
Shire [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Proceeds from licensing arrangement   $ 35 $ 75 $ 110    
Licensing arrangement, maximum potential milestones           460
Shire [Member] | Other Nonoperating Income (Expense) [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Proceeds from licensing arrangement     $ 75     $ 90
BionTech [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Licensing arrangement, maximum potential milestones $ 325          
BionTech [Member] | Research and Development Expense [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Payment for licensing arrangement $ 50          
Long-term Investments [Member] | BionTech [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Number of shares purchased   169,670        
Value of shares purchased   $ 50        
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - R & D and Collaborative Arrangements (Detail) - USD ($)
 1 Months Ended 3 Months Ended 12 Months Ended
Jan. 01, 2018
Oct. 31, 2016
Dec. 31, 2016
May 31, 2016
Apr. 30, 2016
Jan. 31, 2016
Apr. 01, 2018
Apr. 02, 2017
Dec. 31, 2014
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2013
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Revenues [1]                   $ 53,647,000,000 $ 52,546,000,000 $ 52,824,000,000  
Cost of sales [1],[2]                   (11,248,000,000) (11,228,000,000) (12,322,000,000)  
Selling, informational and administrative expenses [1],[2]                   (14,455,000,000) (14,804,000,000) (14,844,000,000)  
Research and development expenses [1],[2]                   (8,006,000,000) (7,683,000,000) (7,892,000,000)  
Other income/(deductions)—net [1]                   (2,116,000,000) (1,416,000,000) (3,794,000,000)  
NovaQuest Co-Investment Fund II, L.P. [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Amount refunded to NovaQuest     $ 31,300,000                    
Maximum funding amount       $ 250,000,000                  
Percentage of costs to be reimbursed       40.00%                  
Reduction to research and development expense                       180,300,000  
NovaQuest Co-Investment Fund V, L.P. [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Maximum funding amount         $ 200,000,000                
Percentage of costs to be reimbursed         100.00%                
Reduction to research and development expense                   57,600,000 72,100,000 46,600,000  
Research and development, contingent payments, maximum exposure         $ 267,000,000                
Term over which funding will be received         3 years 3 months                
RPI Finance Trust [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Maximum funding amount           $ 300,000,000              
Percentage of costs to be reimbursed           100.00%              
Reduction to research and development expense                   99,300,000 75,600,000 44,900,000  
Research and development, contingent payments, maximum exposure           $ 250,000,000              
Collaborative Arrangement [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Revenues                   4,409,000,000 3,533,000,000 2,405,000,000  
Cost of sales [3]                   (296,000,000) (329,000,000) (315,000,000)  
Selling, informational and administrative expenses [4]                   (90,000,000) (54,000,000) (5,000,000)  
Research and development expenses [5]                   162,000,000 222,000,000 64,000,000  
Other income/(deductions)—net [6]                   281,000,000 249,000,000 542,000,000  
Upfront payments and milestone payments                   50,000,000 15,000,000 15,000,000  
Collaborative Arrangement [Member] | Eli Lilly & Company [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Proceeds received from upfront payments and milestone payments                   98,000,000 147,000,000 120,000,000  
Deferred milestone revenue recognized                   37,000,000      
Collaborative Arrangement [Member] | Merck KGaA [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Collaborative arrangement sales based milestones payments                     140,000,000    
Potential milestone payments                 $ 2,000,000,000        
Collaborative Arrangement [Member] | Merck [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Proceeds received from upfront payments and milestone payments                   $ 40,000,000 150,000,000    
Collaborator's revenue and expense ownership percentage                   60.00%      
Company's revenue and expense ownership percentage                   40.00%      
Collaborative Arrangement [Member] | Merck [Member] | Other Nonoperating Income (Expense) [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Proceeds received from upfront payments and milestone payments               $ 90,000,000   $ 40,000,000      
Milestone payment due to be received             $ 40,000,000       60,000,000    
Deferred milestone revenue recognized             90,000,000            
Collaborative Arrangement [Member] | Other Noncurrent Liabilities [Member] | Eli Lilly & Company [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Deferred milestone revenue recognized                   8,000,000      
Collaborative Arrangement [Member] | Other Noncurrent Liabilities [Member] | Merck [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Deferred milestone payment                     60,000,000    
Collaborative Arrangement [Member] | Deferred Revenue [Member] | Eli Lilly & Company [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Proceeds received from upfront payments and milestone payments                         $ 200,000,000
Collaborative Arrangement [Member] | Other current liabilities [Member] | Eli Lilly & Company [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Deferred milestone revenue recognized                   30,000,000      
Revenues [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Revenues [7]                   571,000,000 606,000,000 659,000,000  
Alliance Revenues [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Revenues [8]                   $ 3,838,000,000 $ 2,927,000,000 $ 1,746,000,000  
Royalty revenue, term   36 months                      
Collaborative Arrangement, Upfront Cash Payment [Member] | Merck KGaA [Member] | Research and Development Expense [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Upfront payments and milestone payments                 $ 850,000,000        
Revenues [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Cumulative effect on retained earnings, before tax $ 584,000,000           584,000,000            
Revenues [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Collaborative Arrangement [Member] | Merck [Member] | Other Nonoperating Income (Expense) [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Deferred milestone revenue recognized             85,000,000            
Revenues [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Collaborative Arrangement [Member] | Other Noncurrent Liabilities [Member] | Merck [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Deferred milestone payment             60,000,000            
Revenues [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Collaborative Arrangement [Member] | Deferred Revenue [Member] | Eli Lilly & Company [Member]                          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]                          
Deferred milestone revenue recognized             $ 107,000,000            
[1] Amounts may not add due to rounding.
[2] Exclusive of amortization of intangible assets, except as disclosed in Note 1L. Basis of Presentation and Significant Accounting Policies: Amortization of Intangible Assets, Depreciation and Certain Long-Lived Assets.
[3] Primarily relates to amounts paid to collaboration partners for their share of net sales or profits earned in collaboration arrangements where we are the principal in the transaction, and cost of sales associated with inventory purchased from our partners.
[4] Represents net reimbursements to our partners for selling, informational and administrative expenses incurred.
[5] Primarily relates to upfront payments and pre-approval milestone payments earned by our partners as well as net reimbursements. The upfront and milestone payments were as follows: $50 million in 2018, $15 million in 2017 and $15 million in 2016. Our collaboration with Lilly (see below) also includes reimbursements of $98 million in 2018, $147 million in 2017 and $120 million in 2016.
[6] Primarily relates to royalties from our collaboration partners. The decrease in 2017 is due to the October 31, 2016 expiration of our 36 month royalty arrangement on sales of Enbrel in the U.S. and Canada, partially offset by a full year of royalties earned in 2017, versus a partial year in 2016, on Xtandi ex-U.S. sales.
[7] Represents sales to our partners of products manufactured by us.
[8] Substantially all relates to amounts earned from our partners under co-promotion agreements. The increases in 2018 and 2017 reflect increases in alliance revenues from Eliquis and Xtandi.
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - Equity Method Investments (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Nov. 10, 2017
Dec. 31, 2017
Jul. 02, 2017
Dec. 31, 2016
Jul. 03, 2016
Apr. 03, 2016
Dec. 31, 2017
Dec. 31, 2016
Oct. 01, 2017
Jun. 30, 2017
Sep. 30, 2012
Schedule of Equity Method Investments [Line Items]                      
Equity method investments       $ 270.0       $ 270.0      
Equity method investment, other than temporary impairment       $ 241.0 $ 130.0 $ 81.0   $ 452.0      
Hisun Pfizer Pharmaceuticals Co. Ltd [Member]                      
Schedule of Equity Method Investments [Line Items]                      
Equity method investment, registered capital                     $ 250.0
Equity method investments                     $ 122.5
Equity method investment, ownership percentage 49.00% 49.00%   49.00%     49.00% 49.00%      
Proceeds from sale of equity method investments $ 286.0                    
Equity method investment, carrying value of share sold 270.0                    
Proceeds from sale of equity method investment used to cover taxes incurred on transaction $ 16.0                    
Loss on disposal of equity method investment   $ 81.0                  
Equity method investment, other than temporary impairment               $ 452.0      
Laboratorio Teuto Brasilero [Member]                      
Schedule of Equity Method Investments [Line Items]                      
Equity method investment, ownership percentage       40.00%       40.00% 40.00% 40.00%  
Loss on disposal of equity method investment     $ 30.0       $ 30.0        
Equity method investment, other than temporary impairment               $ 50.0      
Laboratorio Teuto Brasilero [Member] | Other Nonoperating Income (Expense) [Member]                      
Schedule of Equity Method Investments [Line Items]                      
Equity method investment, other than temporary impairment               $ 50.0      
Laboratorio Teuto Brasilero [Member]                      
Schedule of Equity Method Investments [Line Items]                      
Noncontrolling interest, ownership percentage by parent                 60.00%    
Laboratorio Teuto Brasilero [Member] | Laboratorio Teuto Brasilero [Member]                      
Schedule of Equity Method Investments [Line Items]                      
Noncontrolling interest, ownership percentage by parent                   60.00%  
v3.10.0.1
Acquisitions, Divestitures, Assets and Liabilities Held for Sale, Licensing Arrangements, Research and Development and Collaborative Arrangements, Equity-Method Investments and Privately Held Investment - Privately Held Investment (Details) - AM Pharma BV [Member] - USD ($)
$ in Millions
 1 Months Ended
Apr. 30, 2015
Dec. 31, 2017
Schedule of Equity Method Investments [Line Items]    
Impairment of investment   $ 43.0
Long-term Investments [Member]    
Schedule of Equity Method Investments [Line Items]    
Cost method investment, upfront and milestone payments $ 87.5  
v3.10.0.1
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Narrative (Detail) - USD ($)
$ in Millions
 12 Months Ended 36 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
Sep. 03, 2018
Restructuring Cost and Reserve [Line Items]          
Integration costs [1] $ 260 $ 317 $ 383    
Restructuring charges incurred 1,400        
Business Integration Costs [Member]          
Restructuring Cost and Reserve [Line Items]          
Restructuring charges incurred 45        
2017-2019 Initiatives and Organizing for Growth Initiative [Member]          
Restructuring Cost and Reserve [Line Items]          
Restructuring charges incurred 1,100        
Expected cost $ 800        
Percentage of non-cash restructuring charges expected 20.00%        
2017-2019 Initiatives and Organizing for Growth Initiative [Member] | Manufacturing Plant Network Optimization [Member]          
Restructuring Cost and Reserve [Line Items]          
Restructuring cost incurred to date $ 713        
2017-2019 Initiatives and Organizing for Growth Initiative [Member] | Other Activities [Member]          
Restructuring Cost and Reserve [Line Items]          
Restructuring cost incurred to date $ 752        
Hospira [Member]          
Restructuring Cost and Reserve [Line Items]          
Integration costs         $ 1,000
Expected integration costs, period 3 years        
Hospira [Member] | Return of Acquired Rights [Member]          
Restructuring Cost and Reserve [Line Items]          
Restructuring charges incurred       $ 215  
Hospira [Member] | Business Integration Costs [Member]          
Restructuring Cost and Reserve [Line Items]          
Restructuring charges incurred $ 274        
[1] Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes. In 2018, integration costs were primarily related to our acquisition of Hospira. In 2017, integration costs primarily related to our acquisitions of Hospira and Medivation, as well as a net gain of $12 million related to the settlement of the Hospira U.S. qualified defined benefit pension plan (see Note 11). In 2016, integration costs primarily related to our acquisition of Hospira and the terminated transaction with Allergan.
v3.10.0.1
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Costs (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Restructuring charges:      
Employee terminations $ 459 $ (181) $ 839
Asset impairments [1] 290 190 142
Exit costs 33 21 74
Total restructuring charges/(credits) [2] 782 30 1,055
Transaction costs [3] 1 4 127
Integration costs [4] 260 317 383
Restructuring charges and certain acquisition-related costs [5] 1,044 351 1,565
Additional depreciation - asset restructuring, virtually all of which is recorded in Cost of sales [6] 50 91 207
Implementation costs recorded in our consolidated statements of income as follows:      
Implementation costs [7] 194 227 340
Total costs associated with acquisitions and cost-reduction/productivity initiatives 1,434 805 2,271
Other Nonoperating Income (Expense) [Member]      
Restructuring charges:      
Net periodic benefit costs recorded in Other (income)/deductions––net [8] 146 136 159
Cost of Sales [Member]      
Implementation costs recorded in our consolidated statements of income as follows:      
Implementation costs [7] 83 118 230
Selling, Informational and Administrative Expenses [Member]      
Implementation costs recorded in our consolidated statements of income as follows:      
Implementation costs [7] 72 71 81
Research and Development Expense [Member]      
Implementation costs recorded in our consolidated statements of income as follows:      
Implementation costs [7] 39 38 25
Other (income)/deductions - net [Member]      
Implementation costs recorded in our consolidated statements of income as follows:      
Implementation costs [7] $ 0 $ 0 $ 3
[1] The asset impairment charges for 2018 are largely associated with cost reduction initiatives not associated with acquisitions. The asset impairment charges for 2017 are largely associated with our acquisitions of Hospira and Medivation. The asset impairment charges included in restructuring charges for 2017 and 2016 are primarily associated with abandoned assets. See (b) below for additional information.
[2] In 2018, restructuring charges were primarily related to employee termination costs and asset write downs. The employee termination costs are associated with our improvements to operational effectiveness as part of the realignment of our organizational structure effective at the beginning of 2019. In 2017, restructuring charges are primarily associated with our acquisitions of Hospira and Medivation, partially offset by credits associated with cost-reduction and productivity initiatives not associated with acquisitions that mostly related to the reversal of previously recorded accruals for employee termination costs resulting from revisions of our severance benefit estimates. In 2016, restructuring charges are largely associated with cost-reduction and productivity initiatives not associated with acquisitions, as well as our acquisitions of Hospira and Medivation. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.The restructuring activities in 2018 are associated with the following:•IH ($176 million charge); EH ($31 million charge); WRD/GPD ($135 million charge); manufacturing operations ($403 million charge); and Corporate ($38 million charge).The restructuring activities in 2017 are associated with the following:•IH ($83 million credit); EH ($6 million credit); WRD/GPD ($19 million charge); manufacturing operations ($89 million charge); and Corporate ($12 million charge), The restructuring activities in 2016 are associated with the following:•IH ($255 million charge); EH ($155 million charge); WRD/GPD ($145 million charge); manufacturing operations ($328 million charge); and Corporate ($172 million charge).
[3] Transaction costs represent external costs for banking, legal, accounting and other similar services, which in 2017 were directly related to our acquisitions of Hospira, Anacor and Medivation.Transaction costs in 2016 were mostly related to our acquisitions of Medivation and Anacor, and the terminated transaction with Allergan.
[4] Integration costs represent external, incremental costs directly related to integrating acquired businesses, and primarily include expenditures for consulting and the integration of systems and processes. In 2018, integration costs were primarily related to our acquisition of Hospira. In 2017, integration costs primarily related to our acquisitions of Hospira and Medivation, as well as a net gain of $12 million related to the settlement of the Hospira U.S. qualified defined benefit pension plan (see Note 11). In 2016, integration costs primarily related to our acquisition of Hospira and the terminated transaction with Allergan.
[5] Amounts may not add due to rounding.
[6] Additional depreciation––asset restructuring represents the impact of changes in the estimated useful lives of assets involved in restructuring actions.
[7] Implementation costs represent external, incremental costs directly related to implementing our non-acquisition-related cost-reduction/productivity initiatives.
[8] In 2018, primarily represents the net pension curtailments and settlements included in Other (income)/deductions––net upon the adoption of a new accounting standard in the first quarter of 2018. In 2017, primarily represents the net pension curtailments and settlements, partially offset by net periodic benefit credits, excluding service costs, related to our acquisition of Hospira, both of which were reclassified to Other (income)/deductions––net as a result of the retrospective adoption of a new accounting standard in the first quarter of 2018. These credits included a net settlement gain, partially offset by accelerated amortization of actuarial losses and prior service costs upon the settlement of the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. In 2016, primarily represents the net pension curtailments and settlements as well as the accelerated amortization of unrecognized loss and prior service costs related to our acquisition of Hospira, which were reclassified to Other (income)/deductions––net as a result of the retrospective adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 1B and Note 11.
v3.10.0.1
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Costs - Footnotes (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Restructuring Cost and Reserve [Line Items]      
Restructuring charge (credit) [1] $ 782 $ 30 $ 1,055
Corporate [Member]      
Restructuring Cost and Reserve [Line Items]      
Restructuring charge (credit) 38 12 172
Worldwide Research and Development and Global Product Development [Member] | Segment Reconciling Items [Member]      
Restructuring Cost and Reserve [Line Items]      
Restructuring charge (credit) 135 19 145
Manufacturing Operations [Member] | Segment Reconciling Items [Member]      
Restructuring Cost and Reserve [Line Items]      
Restructuring charge (credit) 403 89 328
Innovative Health Segment [Member] | Operating Segments [Member]      
Restructuring Cost and Reserve [Line Items]      
Restructuring charge (credit) 176 (83) 255
Essential Health Segment [Member] | Operating Segments [Member]      
Restructuring Cost and Reserve [Line Items]      
Restructuring charge (credit) 31 (6) 155
Pension Plan [Member] | Qualified Plan [Member] | United States [Member]      
Restructuring Cost and Reserve [Line Items]      
Gain related to settlement [2] $ (113) (75) $ (90)
Pension Plan [Member] | Qualified Plan [Member] | United States [Member] | Hospira [Member]      
Restructuring Cost and Reserve [Line Items]      
Gain related to settlement   $ 12  
[1] In 2018, restructuring charges were primarily related to employee termination costs and asset write downs. The employee termination costs are associated with our improvements to operational effectiveness as part of the realignment of our organizational structure effective at the beginning of 2019. In 2017, restructuring charges are primarily associated with our acquisitions of Hospira and Medivation, partially offset by credits associated with cost-reduction and productivity initiatives not associated with acquisitions that mostly related to the reversal of previously recorded accruals for employee termination costs resulting from revisions of our severance benefit estimates. In 2016, restructuring charges are largely associated with cost-reduction and productivity initiatives not associated with acquisitions, as well as our acquisitions of Hospira and Medivation. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.The restructuring activities in 2018 are associated with the following:•IH ($176 million charge); EH ($31 million charge); WRD/GPD ($135 million charge); manufacturing operations ($403 million charge); and Corporate ($38 million charge).The restructuring activities in 2017 are associated with the following:•IH ($83 million credit); EH ($6 million credit); WRD/GPD ($19 million charge); manufacturing operations ($89 million charge); and Corporate ($12 million charge), The restructuring activities in 2016 are associated with the following:•IH ($255 million charge); EH ($155 million charge); WRD/GPD ($145 million charge); manufacturing operations ($328 million charge); and Corporate ($172 million charge).
[2] In the second quarter of 2017, we settled the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. We purchased a group annuity contract on behalf of the remaining plan participants with a third-party insurance provider. As a result, we were relieved of the $156 million net pension benefit obligation and recorded a pretax settlement gain of $41 million, partially offset by the recognition of actuarial losses and prior service costs upon plan settlement of approximately $30 million in Other (income)/deductions—net (see Note 3).
v3.10.0.1
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Restructuring Accruals (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Restructuring Reserve [Roll Forward]      
Beginning balance $ 1,105 [1] $ 1,583  
Provision/(Credit) [2] 782 30 $ 1,055
Utilization and other [3] (636) (508)  
Ending balance 1,252 [4] 1,105 [1] 1,583
Employee Termination Costs [Member]      
Restructuring Reserve [Roll Forward]      
Beginning balance 1,039 [1] 1,547  
Provision/(Credit) 459 (181)  
Utilization and other [3] (295) (326)  
Ending balance 1,203 [4] 1,039 [1] 1,547
Asset Impairment Charges [Member]      
Restructuring Reserve [Roll Forward]      
Beginning balance 0 [1] 0  
Provision/(Credit) 290 190  
Utilization and other [3] (290) (190)  
Ending balance 0 [4] 0 [1] 0
Exit Costs [Member]      
Restructuring Reserve [Roll Forward]      
Beginning balance 66 [1] 36  
Provision/(Credit) 33 21  
Utilization and other [3] (51) 9  
Ending balance $ 49 [4] $ 66 [1] $ 36
[1] Included in Other current liabilities ($643 million) and Other noncurrent liabilities ($462 million).
[2] In 2018, restructuring charges were primarily related to employee termination costs and asset write downs. The employee termination costs are associated with our improvements to operational effectiveness as part of the realignment of our organizational structure effective at the beginning of 2019. In 2017, restructuring charges are primarily associated with our acquisitions of Hospira and Medivation, partially offset by credits associated with cost-reduction and productivity initiatives not associated with acquisitions that mostly related to the reversal of previously recorded accruals for employee termination costs resulting from revisions of our severance benefit estimates. In 2016, restructuring charges are largely associated with cost-reduction and productivity initiatives not associated with acquisitions, as well as our acquisitions of Hospira and Medivation. Employee termination costs are generally recorded when the actions are probable and estimable and include accrued severance benefits, pension and postretirement benefits, many of which may be paid out during periods after termination.The restructuring activities in 2018 are associated with the following:•IH ($176 million charge); EH ($31 million charge); WRD/GPD ($135 million charge); manufacturing operations ($403 million charge); and Corporate ($38 million charge).The restructuring activities in 2017 are associated with the following:•IH ($83 million credit); EH ($6 million credit); WRD/GPD ($19 million charge); manufacturing operations ($89 million charge); and Corporate ($12 million charge), The restructuring activities in 2016 are associated with the following:•IH ($255 million charge); EH ($155 million charge); WRD/GPD ($145 million charge); manufacturing operations ($328 million charge); and Corporate ($172 million charge).
[3] Includes adjustments for foreign currency translation.
[4] Included in Other current liabilities ($823 million) and Other noncurrent liabilities ($428 million).
v3.10.0.1
Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives - Restructuring Accruals - Footnotes (Detail) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Restructuring Cost and Reserve [Line Items]      
Restructuring reserve $ 1,252 [1] $ 1,105 [2] $ 1,583
Other Current Liabilities [Member]      
Restructuring Cost and Reserve [Line Items]      
Restructuring reserve 823 643  
Other Noncurrent Liabilities [Member]      
Restructuring Cost and Reserve [Line Items]      
Restructuring reserve $ 428 $ 462  
[1] Included in Other current liabilities ($823 million) and Other noncurrent liabilities ($428 million).
[2] Included in Other current liabilities ($643 million) and Other noncurrent liabilities ($462 million).
v3.10.0.1
Other (Income)/Deductions - Net (Details) - USD ($)
$ in Millions
 1 Months Ended 12 Months Ended
Dec. 31, 2017
Nov. 30, 2016
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Other Income and Expenses [Abstract]          
Interest income [1]     $ (333) $ (391) $ (470)
Interest expense [1]     1,316 1,270 1,186
Net interest expense     983 879 716
Royalty-related income [2]     (495) (499) (905)
Net (gains)/losses on asset disposals [3]     (71) 45 (51)
Net gains recognized during the period on investments in equity securities [5]     (586) [4] (224) (18)
Net realized (gains)/losses on sales of investments in debt securities [6]     141 (45) (35)
Income from collaborations, out-licensing arrangements and sales of compound/product rights [7]     (488) (217) (108)
Net periodic benefit costs/(credits) other than service costs [8]     (288) 101 139
Certain legal matters, net [9]     157 240 510
Certain asset impairments [10]     3,115 395 1,447
Adjustments to loss on sale of HIS net assets [11],[12]     (1) 55 1,712
Business and legal entity alignment costs [13]     4 71 261
Net losses on early retirement of debt $ 999 $ 312 3 [14] 999 [14] 312 [14]
Other, net [15]     (357) (383) (186)
Other (income)/deductions––net [16]     $ 2,116 $ 1,416 $ 3,794
[1] 2018 v. 2017––Interest income decreased primarily driven by a lower investment balance. Interest expense increased primarily as a result of higher short-term interest rates, offset, in part, by refinancing activity that occurred in the fourth quarter of 2017. 2017 v. 2016––Interest income decreased primarily driven by a lower investment balance. Interest expense increased, primarily as a result of higher short-term interest rates, offset, in part, by the retirement of high-coupon debt and the issuance of new low-coupon debt. Capitalized interest expense totaled $73 million in 2018, $72 million in 2017 and $61 million in 2016.
[2] Royalty-related income decreased in 2017, primarily due to lower royalty income for Enbrel of $470 million in 2017, compared to 2016, resulting from the expiration on October 31, 2016 of the 36-month royalty period under the collaboration agreement for Enbrel in the U.S. and Canada (the collaboration period under the agreement expired on October 31, 2013), partially offset by increases in Xtandi royalty-related income of $176 million in 2017, compared to 2016.
[3] In 2018, primarily includes a realized gain on sale of property of $60 million. In 2017, primarily includes an $81 million realized loss related to the sale of our then 49%-owned equity-method investment in Hisun Pfizer and a realized net loss of $30 million related to the sale of our 40% ownership investment in Teuto, including the extinguishment of a put option for the then remaining 60% ownership interest, partially offset by a realized gain on sale of property of $52 million. In 2016, primarily includes realized gains on sales of property and other assets.
[4] The net gains on investments in equity securities are reported in Other (income)/deductions––net and, for 2018, include unrealized net gains on equity securities reflecting the adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 4.
[5] The net gains on investments in equity securities in 2018, include unrealized net gains on equity securities of $477 million, reflecting the adoption of a new accounting standard in the first quarter of 2018. Net gains in 2018 were primarily driven by unrealized gains of $466 million related to our investment in Allogene. Prior to the adoption of a new accounting standard in the first quarter of 2018, net unrealized gains and losses on virtually all equity securities with readily determinable fair values were reported in Accumulated other comprehensive income. For additional information, see Note 1B, Note 2B and Note 7B.
[6] In 2018, primarily includes gross realized losses on sales of available-for-sale debt securities of $402 million and a net loss of $18 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities, partially offset by gross realized gains on sales of available-for-sale debt securities of $280 million. Proceeds from the sale of available-for-sale debt securities were $5.7 billion in 2018.In 2017, primarily includes gross realized gains on sales of available-for-sale debt securities of $451 million, partially offset by gross realized losses on sales of available-for-sale debt securities of $281 million and a net loss of $120 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities. Proceeds from the sale of available-for-sale debt securities were $5.1 billion in 2017.In 2016, primarily includes gross realized gains on sales of available-for-sale debt securities of $666 million, partially offset by gross realized losses on sales of available-for-sale debt securities of $548 million and a net loss of $64 million from derivative financial instruments used to hedge the foreign exchange component of the matured available-for-sale debt securities. Proceeds from the sale of available-for-sale debt securities were $10.2 billion in 2016.
[7] Includes income from upfront and milestone payments from our collaboration partners and income from out-licensing arrangements and sales of compound/product rights. In 2018, primarily includes, among other things, (i) approximately $118 million in milestone income from multiple licensees, (ii) $110 million in milestone payments received from Shire, of which $75 million was received in the first quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of ulcerative colitis and $35 million was received from Shire in the third quarter of 2018 related to their first dosing of a patient in a Phase 3 clinical trial for the treatment of Crohn’s disease, (iii) an upfront payment to us and a recognized milestone totaling $85 million for the sale of an AMPA receptor potentiator for CIAS to Biogen, (iv) $62 million in gains related to sales of compound/product rights and (v) a $40 million milestone payment from Merck in conjunction with the approval of ertugliflozin in the EU. For additional information, see Note 2B, Note 2C, Note 2D and Note 2E. In 2017, primarily includes, among other things, $101 million in milestone payments received from multiple licensees and an $85 million gain related to sales of compound/product rights. In 2016, primarily includes, among other things, a $50 million gain related to sales of compound/product rights and $33 million in milestone payments received from multiple licensees.
[8] Represents the net periodic benefit costs/(credits), excluding service costs, as a result of the adoption of a new accounting standard in the first quarter of 2018. Effective January 1, 2018, the U.S. Pfizer Consolidated Pension Plan was frozen to future benefit accruals and for 2018, resulted in the recognition of lower net periodic benefit costs due to the extension of the amortization period for the actuarial losses. There was also a greater than expected gain on plan assets due to a higher plan asset base compared to 2017. For additional information, see Note 1B and Note 11.
[9] In 2018, primarily includes legal reserves for certain pending legal matters, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In 2017, primarily includes a $94 million charge to resolve a class action lawsuit filed by direct purchasers relating to Celebrex, which was approved by the court in April 2018, and a $79 million charge to reflect damages awarded by a jury in a patent matter. In 2016, primarily includes amounts to resolve a Multi-District Litigation relating to Celebrex and Bextra pending against the Company in New York federal court for $486 million, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In addition, 2016 includes a settlement related to a patent matter.
[10] In 2018, primarily includes intangible asset impairment charges of $3.1 billion, mainly composed of (i) $2.6 billion related to EH developed technology rights, $242 million related to EH licensing agreements and $80 million related to EH IPR&D, all of which relate to our acquisition of Hospira, for generic sterile injectable products associated with various indications; (ii) $117 million related to a multi-antigen vaccine IPR&D program for adults undergoing elective spinal fusion surgery; (iii) $31 million related to an IH developed technology right, acquired in connection with our acquisition of Anacor, for the treatment for toenail fungus market marketed in the U.S. market only; and (iv) $17 million of other IPR&D assets acquired in connection with our acquisition of Innopharma. In 2018, the intangible asset impairment charges associated with the generic sterile injectable products reflect, among other things, updated commercial forecasts, reflecting an increased competitive environment as well as higher manufacturing costs, largely stemming from ongoing manufacturing and supply issues. The intangible asset impairment charge for the multi-antigen vaccine IPR&D program was the result of the Phase 2b trial reaching futility at a pre-planned interim analysis. The intangible asset impairment charge related to the IH developed technology right reflects, among other things, updated commercial forecasts. In addition, 2018 includes other asset impairments of $13 million.In 2017, primarily includes intangible asset impairment charges of $337 million, reflecting (i) $127 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a generic sterile injectable product for the treatment of edema associated with certain conditions; (ii) $124 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a sterile injectable pain reliever; (iii) $39 million related to developed technology rights, acquired in connection with our acquisition of NextWave, for the treatment of attention deficit hyperactivity disorder; (iv) $26 million related to developed technology rights, acquired in connection with our acquisition of Hospira, for a generic injectable antibiotic product for the treatment of bacterial infections; and (v) $20 million related to other developed technology rights. The intangible asset impairment charges for 2017 are associated with EH and reflect, among other things, updated commercial forecasts and an increased competitive environment. In addition, 2017 includes a loss of $43 million for an impairment of our AM-Pharma B.V. long-term investment (see Note 2G).In 2016, primarily includes intangible asset impairment charges of $869 million, reflecting (i) $366 million related to developed technology rights for a generic injectable antibiotic product for the treatment of bacterial infections; and (ii) $265 million related to an IPR&D compound for the treatment of anemia, both acquired in connection with our acquisition of Hospira; (iii) $128 million of sterile injectable IPR&D compounds acquired in connection with our acquisition of InnoPharma; and (iv) $110 million of other IPR&D assets, $81 million of which were acquired in connection with our acquisition of Hospira and $29 million of which were acquired in connection with our acquisition of King in 2011. The intangible asset impairment charges for 2016 are associated with the following: EH ($840 million) and IH ($29 million). In addition, 2016 includes an impairment loss of $452 million related to Pfizer’s then 49%-owned equity-method investment with Hisun in China, Hisun Pfizer, and an impairment loss of $50 million related to Pfizer's 40%-owned equity-method investment in Teuto. For additional information concerning Hisun Pfizer and Teuto, see Note 2F. The intangible asset impairment charge for 2016 for the IPR&D compound for the treatment of anemia acquired in connection with our acquisition of Hospira reflects, among other things, the impact of regulatory delays, including delays resulting from a then recent court ruling, requiring a 180-day waiting period after approval before a biosimilar product can be launched. The intangible asset impairment charges for 2016 for the sterile injectable IPR&D compounds acquired in connection with our acquisition of InnoPharma reflect, among other things, the impact of portfolio prioritization decisions and decreased commercial profiles of certain compounds. The intangible asset impairment charges for 2016 for developed technology rights and other IPR&D assets acquired in connection with our acquisition of Hospira reflect, among other things, the impact of regulatory delays, the impact of new scientific findings, updated commercial forecasts, changes in pricing, and an increased competitive environment. The intangible asset impairment charges for 2016 for other IPR&D assets acquired in connection with our acquisition of King reflect changes in the competitive environment.
[11] Amounts may not add due to rounding.
[12] In 2018 and 2017, represents adjustments to amounts previously recorded in 2016 to write down the HIS net assets to fair value less costs to sell related to the sale of HIS net assets to ICU Medical on February 3, 2017. In 2016, represents a charge related to the write-down of the HIS net assets to fair value less estimated costs to sell. See Note 2B for additional information.
[13] Represents expenses for changes to our infrastructure to align our commercial operations that existed through December 31, 2018, including costs to internally separate our businesses into distinct legal entities, as well as to streamline our intercompany supply operations to better support each business.
[14] In 2017 and 2016, represents net losses due to the early retirement of debt, inclusive of the related termination of cross currency swaps in 2017 and inclusive of the related termination of interest rate swaps in 2016.
[15] In 2018, includes (i) a non-cash $343 million pre-tax gain associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system (see Note 2B), (ii) dividend income of $253 million from our investment in ViiV, (iii) a non-cash $50 million pre-tax gain on the contribution of Pfizer’s allogeneic CAR T therapy development program assets obtained from Cellectis and Servier in connection with our contribution agreement entered into with Allogene in which Pfizer obtained a 25% ownership stake in Allogene (see Note 2B), and (iv) a non-cash $17 million pre-tax gain on the cash settlement of a liability that we incurred in April 2018 upon the EU approval of Mylotarg (see Note 7E), partially offset by charges of $207 million, reflecting the change in the fair value of contingent consideration and $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily include consulting, legal, tax, and advisory services. In 2017, includes, among other things, dividend income of $266 million from our investment in ViiV, and income of $62 million from resolution of a contract disagreement. In 2016, includes among other things, $150 million paid to Allergan for reimbursement of Allergan’s expenses associated with the terminated transaction (see Note 1A); and income of $116 million from resolution of a contract disagreement.
[16] Amounts may not add due to rounding.
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Interest (Income) Expense (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Other Income and Expenses [Abstract]      
Interest costs capitalized $ 73 $ 72 $ 61
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Royalty Income (Details) - USD ($)
$ in Millions
 1 Months Ended 12 Months Ended
Oct. 31, 2016
Oct. 31, 2016
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]          
Royalty income [1]     $ 495 $ 499 $ 905
Xtandi [Member]          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]          
Royalty income       176  
Collaborative Arrangement, Co-promotion [Member]          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]          
Royalty revenue, term 36 months        
Collaborative Arrangement, Co-promotion [Member] | Enbrel [Member]          
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]          
Decrease in royalty revenue       $ 470  
Royalty revenue, term   36 months      
[1] Royalty-related income decreased in 2017, primarily due to lower royalty income for Enbrel of $470 million in 2017, compared to 2016, resulting from the expiration on October 31, 2016 of the 36-month royalty period under the collaboration agreement for Enbrel in the U.S. and Canada (the collaboration period under the agreement expired on October 31, 2013), partially offset by increases in Xtandi royalty-related income of $176 million in 2017, compared to 2016.
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Asset Disposals and Investments (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Dec. 31, 2017
Jul. 02, 2017
Dec. 31, 2018
Dec. 31, 2017
Nov. 10, 2017
Oct. 01, 2017
Jun. 30, 2017
Dec. 31, 2016
Investment Holdings [Line Items]                
Gain on sale of property     $ 60 $ 52        
Unrealized gain on equity securities     477          
Hisun Pfizer Pharmaceuticals Co. Ltd [Member]                
Investment Holdings [Line Items]                
Gain on sale of property       $ (81)        
Equity method investment, ownership percentage 49.00%     49.00% 49.00%     49.00%
Loss on disposal of equity method investment $ 81              
Laboratorio Teuto Brasilero [Member]                
Investment Holdings [Line Items]                
Equity method investment, ownership percentage           40.00% 40.00% 40.00%
Loss on disposal of equity method investment   $ 30   $ 30        
Allogene [Member]                
Investment Holdings [Line Items]                
Unrealized gain on equity securities     466          
Laboratorio Teuto Brasilero [Member]                
Investment Holdings [Line Items]                
Noncontrolling interest, ownership percentage by parent           60.00%    
Financial Assets and Liabilities [Member]                
Investment Holdings [Line Items]                
Unrealized gain on equity securities     $ 477          
v3.10.0.1
Other (Income)/ Deductions - Net - Footnotes - Investments (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Derivative [Line Items]      
Available-for-sale debt securities, gross realized loss $ 402 $ 281 $ 548
Available-for-sale debt securities, gross realized gain 280 451 666
Proceeds from sale of available-for-sale debt securities 5,700 5,100 10,200
Designated as Hedging Instrument [Member] | Foreign Exchange Contract [Member] | Debt Securities [Member]      
Derivative [Line Items]      
Loss on derivative instruments, net, pretax $ 18 $ 120 $ 64
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Collaborative Arrangements (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Sep. 30, 2018
Apr. 01, 2018
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Apr. 30, 2018
Licensing Agreements [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Proceeds received from upfront payments and milestone payments     $ 118      
Proceeds from licensing arrangement       $ 101 $ 33  
Shire [Member] | Licensing Agreements [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Proceeds from licensing arrangement $ 35 $ 75 110      
Merck [Member] | Collaborative Arrangement [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Proceeds received from upfront payments and milestone payments     40 150    
Phase 2b Ready AMPA Receptor Potentiator For CIAS [Member] | Disposed of by Sale, Not Discontinued Operations [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Cash received for disposition     85     $ 75
Distribution Rights [Member]            
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]            
Gain related to sale of intangible assets     $ 62 $ 85 $ 50  
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Commitments and Contingencies (Details) - Pending Litigation [Member] - USD ($)
$ in Millions
 1 Months Ended 12 Months Ended
Nov. 30, 2017
Dec. 31, 2017
Dec. 31, 2016
Patent Matter [Member]      
Loss Contingencies [Line Items]      
Litigation settlement expense   $ 79  
Celebrex [Member]      
Loss Contingencies [Line Items]      
Litigation settlement expense   $ 94  
Litigation settlement, amount awarded to other party $ 94    
Celebrex and Bextra [Member] | Product Safety Misrepresentation [Member]      
Loss Contingencies [Line Items]      
Litigation settlement, amount awarded to other party     $ 486
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Intangible Assets (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Dec. 31, 2016
Jul. 03, 2016
Apr. 03, 2016
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Nov. 10, 2017
Oct. 01, 2017
Jun. 30, 2017
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       $ 3,103 $ 337 $ 869      
Other asset impairment charges       13          
Equity method investment, other than temporary impairment $ 241 $ 130 $ 81     452      
Operating Segments [Member] | Essential Health Segment [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           840      
Operating Segments [Member] | Innovative Health Segment [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           29      
In Process Research and Development [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments [1]       214          
In Process Research and Development [Member] | Multi-Antigen Vaccine For Spinal Fusion Surgery [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       117          
In Process Research and Development [Member] | Hospira [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           265      
In Process Research and Development [Member] | InnoPharma [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           128      
Other In Process Research and Development [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           110      
Other In Process Research and Development [Member] | Hospira [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           81      
Other In Process Research and Development [Member] | InnoPharma [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       17          
Other In Process Research and Development [Member] | King [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           29      
AM Pharma BV [Member]                  
Schedule of Intangible Assets [Line Items]                  
Impairment of investment         $ 43        
Hisun Pfizer Pharmaceuticals Co. Ltd [Member]                  
Schedule of Intangible Assets [Line Items]                  
Equity method investment, other than temporary impairment           $ 452      
Equity method investment, ownership percentage 49.00%       49.00% 49.00% 49.00%    
Laboratorio Teuto Brasilero [Member]                  
Schedule of Intangible Assets [Line Items]                  
Equity method investment, other than temporary impairment           $ 50      
Equity method investment, ownership percentage 40.00%         40.00%   40.00% 40.00%
Developed Technology Rights [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       2,647 [1] $ 20        
Developed Technology Rights [Member] | Hospira [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments           $ 366      
Developed Technology Rights [Member] | Hospira [Member] | Generic Sterile Injectable Product [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments         127        
Developed Technology Rights [Member] | Hospira [Member] | Sterile Injectable Pain Reliever [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments         124        
Developed Technology Rights [Member] | Hospira [Member] | Generic Injectable Pain Reliever [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments         26        
Developed Technology Rights [Member] | NextWave [Member] | Treatment Of Attention Hyperactivity Disorder [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments         $ 39        
Developed Technology Rights [Member] | Operating Segments [Member] | Essential Health Segment [Member] | Hospira [Member] | Generic Sterile Injectable Product [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       2,600          
Developed Technology Rights [Member] | Operating Segments [Member] | Innovative Health Segment [Member] | Anacor [Member] | Treatment For Toenail Fungus [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       31          
Licensing Agreements [Member] | Operating Segments [Member] | Essential Health Segment [Member] | Hospira [Member] | Generic Sterile Injectable Product [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       242          
In Process Research and Development [Member] | Operating Segments [Member] | Essential Health Segment [Member] | Hospira [Member] | Generic Sterile Injectable Product [Member]                  
Schedule of Intangible Assets [Line Items]                  
Intangible asset impairments       $ 80          
[1] Reflects intangible assets written down to fair value in 2018. Fair value was determined using the income approach, specifically the multi-period excess earnings method, also known as the discounted cash flow method. We started with a forecast of all the expected net cash flows associated with the asset and then applied an asset-specific discount rate to arrive at a net present value amount. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the product; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Additional Information (Details) - USD ($)
$ in Millions
 1 Months Ended 3 Months Ended 12 Months Ended
Apr. 08, 2016
Oct. 31, 2018
Sep. 30, 2018
Apr. 30, 2018
Jul. 01, 2018
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Business Acquisition [Line Items]                
Gain associated with Bain Capital transaction [2]           $ 586 [1] $ 224 $ 18
Change in fair value of fair value contingent consideration liabilities           207    
Income from resolution of contract disagreement             62 116
Payments for merger termination costs $ 150             $ 150
Allogene [Member]                
Business Acquisition [Line Items]                
Gain from contribution agreement         $ 50 50    
Ownership percentage   18.00%   25.00%        
ViiV Healthcare Limited [Member]                
Business Acquisition [Line Items]                
Dividend income           253    
Innovative Health Segment [Member] | ViiV Healthcare Limited [Member]                
Business Acquisition [Line Items]                
Dividend income             266  
Operating Segments [Member] | Innovative Health Segment [Member] | ViiV Healthcare Limited [Member]                
Business Acquisition [Line Items]                
Dividend income           253 $ 266  
Segment Reconciling Items [Member] | Allogene [Member]                
Business Acquisition [Line Items]                
Gain from contribution agreement           50    
Bain Capital [Member] | Cerevel [Member]                
Business Acquisition [Line Items]                
Gain associated with Bain Capital transaction     $ 343     343    
Bain Capital [Member] | Segment Reconciling Items [Member] | Cerevel [Member]                
Business Acquisition [Line Items]                
Gain associated with Bain Capital transaction           343    
European Union [Member] | Mylotarg [Member] | Developed Technology Rights [Member]                
Business Acquisition [Line Items]                
Gain from cash settlement of liability         $ 17 17    
2017-2019 Initiatives and Organizing for Growth Initiative [Member]                
Business Acquisition [Line Items]                
Legal, tax and advisory service expense           59    
2017-2019 Initiatives and Organizing for Growth Initiative [Member] | Segment Reconciling Items [Member]                
Business Acquisition [Line Items]                
Legal, tax and advisory service expense           $ 59    
[1] The net gains on investments in equity securities are reported in Other (income)/deductions––net and, for 2018, include unrealized net gains on equity securities reflecting the adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 4.
[2] The net gains on investments in equity securities in 2018, include unrealized net gains on equity securities of $477 million, reflecting the adoption of a new accounting standard in the first quarter of 2018. Net gains in 2018 were primarily driven by unrealized gains of $466 million related to our investment in Allogene. Prior to the adoption of a new accounting standard in the first quarter of 2018, net unrealized gains and losses on virtually all equity securities with readily determinable fair values were reported in Accumulated other comprehensive income. For additional information, see Note 1B, Note 2B and Note 7B.
v3.10.0.1
Other (Income)/Deductions - Net - Footnotes - Additional Information About Impaired Intangible Assets (Detail) - USD ($)
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Total [1] $ 910,000,000    
Impairment 3,103,000,000 $ 337,000,000 $ 869,000,000
Developed Technology Rights [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 665,000,000    
Impairment 2,647,000,000 [2] $ 20,000,000  
Licensing Agreements And Other [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 150,000,000    
Impairment [2] 242,000,000    
Level 1 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Total [1] 0    
Level 1 [Member] | Developed Technology Rights [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 0    
Level 1 [Member] | Licensing Agreements And Other [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 0    
Level 2 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Total [1] 0    
Level 2 [Member] | Developed Technology Rights [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 0    
Level 2 [Member] | Licensing Agreements And Other [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 0    
Level 3 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Total [1] 910,000,000    
Level 3 [Member] | Developed Technology Rights [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 665,000,000    
Level 3 [Member] | Licensing Agreements And Other [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––Developed technology rights [1],[2] 150,000,000    
In Process Research and Development [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––IPR&D [1],[2] 95,000,000    
Impairment [2] 214,000,000    
In Process Research and Development [Member] | Level 1 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––IPR&D [1],[2] 0    
In Process Research and Development [Member] | Level 2 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––IPR&D [1],[2] 0    
In Process Research and Development [Member] | Level 3 [Member]      
Fair Value Measurement Inputs and Valuation Techniques [Line Items]      
Intangible assets––IPR&D [1],[2] $ 95,000,000    
[1] The fair value amount is presented as of the date of impairment, as these assets are not measured at fair value on a recurring basis. See also Note 1E.
[2] Reflects intangible assets written down to fair value in 2018. Fair value was determined using the income approach, specifically the multi-period excess earnings method, also known as the discounted cash flow method. We started with a forecast of all the expected net cash flows associated with the asset and then applied an asset-specific discount rate to arrive at a net present value amount. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the product; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.
v3.10.0.1
Tax Matters - Income from Continuing Operations Before Provision for Taxes on Income (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Income Tax Disclosure [Abstract]      
United States $ (4,403) $ (6,879) $ (8,534)
International 16,288 19,184 16,886
Income from continuing operations before provision/(benefit) for taxes on income [1],[2],[3],[4] $ 11,885 $ 12,305 $ 8,351
[1] 2017 v. 2016––The decrease in the domestic loss was primarily due to lower restructuring charges and certain acquisition-related costs, the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower certain asset impairments and lower certain legal matters, partially offset by higher net losses on early retirement of debt, and higher amortization of intangible assets. The increase in international income was primarily due to the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower restructuring charges and certain acquisition-related costs, and lower certain asset impairments.
[2] 2018 v. 2017––The decrease in the domestic loss was primarily due to lower interest expense paid to certain foreign subsidiaries, lower net losses on the retirement of debt, higher net gains on investments in equity securities and increased revenue related to Eliquis, partially offset by higher certain asset impairments and lower revenue for Viagra and the SIP portfolio. The decrease in international income was primarily related to lower interest income received primarily from intercompany borrowings from Pfizer Inc. and higher charges related to certain cost reduction initiatives, partially offset by increased revenue related to Ibrance and Eliquis.
[3] Amounts may not add due to rounding.
[4] Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
v3.10.0.1
Tax Matters - Provision for Taxes on Income (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Current income taxes:      
Federal $ 668 $ 1,267 $ 342
State and local 9 45 (52)
Deferred income taxes:      
Federal (1,663) (2,064) (419)
State and local 16 (304) (106)
Total U.S. tax provision (970) (1,055) (235)
TCJA      
Current income taxes [1] (3,035) 13,135 0
Deferred Income taxes [1] 2,439 (23,795) 0
Total TCJA tax provision [1] (596) (10,660) 0
International      
Current income taxes 2,831 2,709 1,532
Deferred income taxes (558) (42) (175)
Total international tax provision 2,273 2,667 1,358
Provision/(benefit) for taxes on income [2] $ 706 $ (9,049) $ 1,123
[1] The 2018 current tax benefit and deferred tax expense primarily relate to the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See discussion below and Note 5C.
[2] Amounts may not add due to rounding.
v3.10.0.1
Tax Matters - Provision for Taxes on Income (Narrative) (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Income Tax Disclosure [Abstract]      
Repatriation tax liability $ 15,000 $ 15,200  
Tax benefit related to measurement adjustment 100    
Provisional expense related to future taxes on global intangible low-taxed income   1,000  
Additional expense related to future taxes on global intangible low-taxed income 200    
Expense related to future taxes on global intangible low-taxed income 1,200    
Tax benefits associated with the enactment of the TCJA [1] 596 10,660 $ 0
Tax benefits associated with certain current year tax initiatives 500    
Tax benefits related to the repatriation tax on deemed repatriated accumulated earnings of foreign subsidiaries 160    
Tax benefit associated with the remeasurement of other U.S. deferred tax liabilities 140    
Tax expense related to future taxes on global intangible low-taxed income 200    
Tax benefits from resolution of certain tax positions 700 150 460
Tax benefits related to certain asset impairments 740    
Tax benefit from Tax Cuts and Jobs Act of 2017 [2],[3] $ 596 10,660 0
Tax benefit associated with remeasurement of U.S. deferred tax liabilities on remitted earnings of foreign subsidiaries   22,800  
Tax benefit associated with remeasurement of U.S. deferred tax liabilities primarily intangibles   1,600  
Expense related to repatriation tax on deemed repatriated accumulated pre-2017 earnings of foreign subsidiaries   12,900  
Expense related to future taxes on global intangible low-taxed income   1,000  
Tax benefit primarily associated with certain tax initiatives   100  
Deferred income taxes on certain current-year funds earned outside of the U.S.   1,300 1,100
Tax benefit related to net losses on early retirement of debt   370  
Selling, informational and administrative expenses   $ 307 312
Tax benefit due to adoption of accounting standard     $ 89
[1] The 2018 current tax benefit and deferred tax expense primarily relate to the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See discussion below and Note 5C.
[2] Amounts may not add due to rounding.
[3] As a result of the enactment of the TCJA in December 2017, Pfizer’s Provision/(benefit) for taxes on income (i) for the year ended December 31, 2017 was favorably impacted by approximately $10.7 billion, primarily reflecting the remeasurement of U.S. deferred tax liabilities, which includes the repatriation tax on deemed repatriated accumulated post-1986 earnings of foreign subsidiaries and (ii) for the year ended December 31, 2018 was favorably impacted by approximately $600 million, primarily related to certain tax initiatives associated with the TCJA, as well as favorable adjustments to the provisional estimates of the legislation. See Note 5A. Tax Matters: Taxes on Income from Continuing Operations for additional information.
v3.10.0.1
Tax Matters - Tax Rate Reconciliation (Details)
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Income Tax Disclosure [Abstract]      
U.S. statutory income tax rate 21.00% 35.00% 35.00%
TCJA impact [1] (5.00%) (86.60%) 0.00%
Taxation of non-U.S. operations [2],[3],[4] (6.10%) (17.00%) (13.80%)
Tax settlements and resolution of certain tax positions [5] (5.80%) (1.20%) (5.50%)
U.S. Healthcare Legislation [5],[6] (0.40%) 0.90% 1.30%
U.S. R&D tax credit and manufacturing deduction [5] (0.70%) (0.70%) (1.00%)
Certain legal settlements and charges [5] (0.10%) 0.10% (2.90%)
All other, net [7] 3.10% (3.90%) 0.30%
Effective tax rate for income from continuing operations 5.90% (73.50%) 13.40%
[1] For a discussion about the enactment of the TCJA, see Note 5A.
[2] For taxation of non-U.S. operations, this rate impact reflects the income tax rates and relative earnings in the locations where we do business outside the U.S., together with the cost of repatriation decisions, which, for 2017, includes the repatriation tax on deemed repatriated 2017 earnings of foreign subsidiaries discussed in Note 5A, changes in uncertain tax positions not included in the reconciling item called “Tax settlements and resolution of certain tax positions,” as well as changes in valuation allowances. Specifically: (i) the jurisdictional location of earnings is a significant component of our effective tax rate each year, and the rate impact of this component is influenced by the specific location of non-U.S. earnings and the level of such earnings as compared to our total earnings; (ii) the cost of repatriation decisions, and other U.S. tax implications of our foreign operations, is a significant component of our effective tax rate each year and generally offsets some of the reduction to our effective tax rate each year resulting from the jurisdictional location of earnings; and (iii) the impact of changes in uncertain tax positions not included in the reconciling item called “Tax settlements and resolution of certain tax positions” is a component of our effective tax rate each year that can result in either an increase or decrease to our effective tax rate. The jurisdictional mix of earnings, which includes the impact of the location of earnings as well as repatriation costs, can vary as a result of the repatriation decisions, as a result of operating fluctuations in the normal course of business and as a result of the extent and location of other income and expense items, such as restructuring charges, asset impairments and gains and losses on strategic business decisions. See also Note 5A for the components of pre-tax income and Provision/(benefit) for taxes on income, which is based on the location of the taxing authorities, and for information about settlements and other items impacting Provision/(benefit) for taxes on income.
[3] In all periods presented, the reduction in our effective tax rate resulting from the jurisdictional location of earnings is largely due to lower tax rates in certain jurisdictions, as well as manufacturing and other incentives associated with our subsidiaries in Puerto Rico and Singapore. 2016 also includes incentives in Costa Rica and the Dominican Republic related to the Hospira infusion systems business, which was sold to ICU Medical in February 2017. We benefit from a Puerto Rican incentive grant that expires in 2029. Under the grant, we are partially exempt from income, property and municipal taxes. In Singapore, we benefit from incentive tax rates effective through 2031 on income from manufacturing and other operations.
[4] The favorable rate impacts in 2018 and 2017 also reflect lower repatriation costs associated with the estimated income of our foreign subsidiaries. The favorable rate impact in 2016 also includes the non-recurrence of the non-deductibility of a foreign currency loss related to Venezuela.
[5] For a discussion about tax settlements and resolution of certain tax positions, the impact of U.S. Healthcare Legislation, the U.S. R&D tax credit and manufacturing deduction and the impact of certain legal settlements and charges, see Note 5A.
[6] The favorable rate impact in 2018 is a result of the updated 2017 invoice received from the federal government, which reflected a lower expense than what was previously estimated for invoiced periods, as well as certain tax initiatives.
[7] All other, net in 2018 is primarily due to routine business operations and the non-recurrence of tax benefits associated with certain tax initiatives. 2017 primarily relates to tax benefits associated with certain tax initiatives in the normal course of business.
v3.10.0.1
Tax Matters - Deferred Taxes (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Deferred Tax Assets    
Prepaid/deferred items - Deferred tax assets [1] $ 1,655 $ 1,837
Inventories - Deferred tax assets [1] 280 405
Intangible assets - Deferred tax assets [1],[2] 532 685
Property, plant and equipment - Deferred tax assets [1] 160 124
Employee benefits - Deferred tax assets [1] 2,292 2,346
Restructurings and other charges - Deferred tax assets [1] 266 240
Legal and product liability reserves - Deferred tax assets [1] 415 480
Net operating loss/credit carryforwards - Deferred tax assets [1],[3],[4] 2,512 4,502
State and local tax adjustments - Deferred tax assets [1] 264 178
All other - Deferred tax assets [1] 200 492
Subtotal - Deferred tax assets [1] 8,576 11,289
Valuation allowance [1] (2,068) (2,203)
Total deferred taxes - Deferred tax assets [1] 6,508 9,086
Deferred Tax Liabilities    
Prepaid/deferred items - Deferred tax liabilities [1] (325) (132)
Inventories - Deferred tax liabilities [1] (10) (3)
Intangible assets - Deferred tax liabilities [1],[2] (7,620) (10,808)
Property, plant and equipment - Deferred tax liabilities [1] (1,011) (755)
Employee benefits - Deferred tax liabilities [1] (134) (109)
Restructurings and other charges - Deferred tax liabilities [1]   (8)
Unremitted earnings - Deferred tax liabilities [1] (83) (85)
All other - Deferred tax liabilities [1] (274) (424)
Deferred tax liabilities, gross [1] (9,456) (12,325)
Net deferred tax liability [1],[5] $ (2,948) $ (3,238)
[1] For 2018 and 2017, the deferred tax assets and liabilities associated with global intangible low-taxed income are included in the relevant categories above. See Note 5A. 2018 excludes deferred tax assets and liabilities associated with fully dedicated consumer healthcare subsidiaries. For additional information, see Note 2C.
[2] The decrease in 2018 is primarily the result of amortization of intangible assets and certain impairment charges.
[3] The amounts in 2018 and 2017 are reduced for unrecognized tax benefits of $3.3 billion and $3.4 billion, respectively, where we have net operating loss carryforwards, similar tax losses, and/or tax credit carryforwards that are available, under the tax law of the applicable jurisdiction, to settle any additional income taxes that would result from the disallowance of a tax position.
[4] The decrease in 2018 is primarily a result of the utilization of tax credit carryforwards against the repatriation tax liability associated with the enactment of the TCJA. See Note 5A.
[5] In 2018, Noncurrent deferred tax assets and other noncurrent tax assets ($0.8 billion), and Noncurrent deferred tax liabilities ($3.7 billion). In 2017, Noncurrent deferred tax assets and other noncurrent tax assets ($0.7 billion), and Noncurrent deferred tax liabilities ($3.9 billion).
v3.10.0.1
Tax Matters - Deferred Taxes - Footnotes (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Income Tax Examination [Line Items]    
Reduction for unrecognized tax benefit $ 3,300 $ 3,400
Net deferred tax liability [1],[2] 2,948 3,238
Noncurrent Deferred Tax Assets And Other Noncurrent Tax Assets [Member]    
Income Tax Examination [Line Items]    
Net deferred tax liability 800 700
Noncurrent Deferred Tax Liabilities [Member]    
Income Tax Examination [Line Items]    
Net deferred tax liability $ 3,700 $ 3,900
[1] For 2018 and 2017, the deferred tax assets and liabilities associated with global intangible low-taxed income are included in the relevant categories above. See Note 5A. 2018 excludes deferred tax assets and liabilities associated with fully dedicated consumer healthcare subsidiaries. For additional information, see Note 2C.
[2] In 2018, Noncurrent deferred tax assets and other noncurrent tax assets ($0.8 billion), and Noncurrent deferred tax liabilities ($3.7 billion). In 2017, Noncurrent deferred tax assets and other noncurrent tax assets ($0.7 billion), and Noncurrent deferred tax liabilities ($3.9 billion).
v3.10.0.1
Tax Matters - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Income Tax Contingency [Line Items]      
Unrecognized tax benefits excluding associated interest $ 5,100 $ 5,400  
Deferred tax assets associated with unrecognized tax benefits 1,100 1,200  
Unrecognized tax benefits, interest on income taxes expense 103 208 $ 72
Unrecognized accrued interest decrease as a result of cash payments 16 4  
Unrecognized tax benefits, interest on income taxes accrued 1,100 975  
Decrease in unrecognized tax benefits is reasonably possible, amount of unrecorded benefit 75    
Unremitted earnings of international subsidiaries 31,000    
Noncurrent Deferred Tax Assets And Other Noncurrent Tax Assets [Member]      
Income Tax Contingency [Line Items]      
Deferred tax assets associated with unrecognized tax benefits 1,000 1,000  
Deferred Tax Liabilities, Net, Noncurrent [Member]      
Income Tax Contingency [Line Items]      
Deferred tax assets associated with unrecognized tax benefits 128 118  
Income Taxes Payable [Member]      
Income Tax Contingency [Line Items]      
Unrecognized tax benefits, interest on income taxes accrued 6    
Other Taxes Payable [Member]      
Income Tax Contingency [Line Items]      
Unrecognized tax benefits, interest on income taxes accrued $ 1,100 $ 975  
v3.10.0.1
Tax Matters - Reconciliation of Gross Unrecognized Tax Benefits (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]      
Balance, beginning $ (6,558) [1] $ (5,826) [1] $ (5,919)
Acquisitions [2] 0 10 (83)
Increases based on tax positions taken during a prior period [3] (192) (49) (11)
Decreases based on tax positions taken during a prior period [3],[4] 561 28 409
Decreases based on settlements for a prior period [5] 123 35 126
Increases based on tax positions taken during the current period [3] (370) (753) (489)
Impact of foreign exchange 56 (121) (5)
Other, net [3],[6] 121 118 146
Balance, ending [1] $ (6,259) $ (6,558) $ (5,826)
[1] In 2018, included in Income taxes payable ($11 million), Current tax assets ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($47 million), Noncurrent deferred tax liabilities ($3.2 billion) and Other taxes payable ($3.0 billion). In 2017, included in Income taxes payable ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($123 million), Noncurrent deferred tax liabilities ($3.3 billion) and Other taxes payable ($3.2 billion).
[2] For 2017 and 2016, primarily related to the acquisitions of Medivation and Anacor. See also Note 2A.
[3] Primarily included in Provision/(benefit) for taxes on income.
[4] Primarily related to effectively settling certain tax positions primarily with foreign tax authorities. See also Note 5A.
[5] Primarily related to cash payments and reductions of tax attributes.
[6] Primarily related to decreases as a result of a lapse of applicable statutes of limitations.
v3.10.0.1
Tax Matters - Reconciliation of Gross Unrecognized Tax Benefits - Footnotes (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
 [1]
Dec. 31, 2015
Income Tax Contingency [Line Items]        
Unrecognized tax benefits $ 6,259 [1] $ 6,558 [1] $ 5,826 $ 5,919
Income Taxes Payable [Member]        
Income Tax Contingency [Line Items]        
Unrecognized tax benefits 11 1    
Noncurrent Deferred Tax Assets And Other Noncurrent Tax Assets [Member]        
Income Tax Contingency [Line Items]        
Unrecognized tax benefits 47 123    
Noncurrent Deferred Tax Liabilities [Member]        
Income Tax Contingency [Line Items]        
Unrecognized tax benefits 3,200 3,300    
Other Taxes Payable [Member]        
Income Tax Contingency [Line Items]        
Unrecognized tax benefits $ 3,000 $ 3,200    
[1] In 2018, included in Income taxes payable ($11 million), Current tax assets ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($47 million), Noncurrent deferred tax liabilities ($3.2 billion) and Other taxes payable ($3.0 billion). In 2017, included in Income taxes payable ($1 million), Noncurrent deferred tax assets and other noncurrent tax assets ($123 million), Noncurrent deferred tax liabilities ($3.3 billion) and Other taxes payable ($3.2 billion).
v3.10.0.1
Tax Matters - Taxes on Items of Other Comprehensive Income/(Loss) (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Tax Expense/(Benefit) on Other Comprehensive Income/(Loss)      
Foreign currency translation adjustments, net [1] $ 94 $ (215) $ (15)
Unrealized holding gains/(losses) on derivative financial instruments, net 21 72 (75)
Reclassification adjustments for (gains)/losses included in net income 27 (224) 158
Other comprehensive income (loss), derivatives qualifying as hedges, tax, total 50 (152) 83
Unrealized holding gains/(losses) on available-for-sale securities, net (23) 102 49
Reclassification adjustments for (gains)/losses included in net income 16 (60) (15)
Other comprehensive income (loss), available-for-sale securities, tax, total (53) 42 34
Benefit plans: actuarial losses, net (141) (59) (535)
Reclassification adjustments related to amortization 55 192 186
Reclassification adjustments related to settlements, net 33 42 45
Other 29 (39) 36
Defined benefit plan, amounts recognized in other comprehensive income (loss), net actuarial gain (loss), tax 612 137 (269)
Benefit plans: prior service (costs)/credits and other, net 2 0 67
Reclassification adjustments related to amortization (39) (67) (64)
Reclassification adjustments related to curtailments, net (4) (7) (10)
Other 0 0 (1)
Other comprehensive income (loss), pension and other postretirement benefit plans, net prior service cost (credit), tax (185) (74) (7)
Tax provision/(benefit) on other comprehensive income/(loss) [2],[3] 518 (262) (174)
Reclassification of Certain Tax Effects from AOCI [Member]      
Tax Expense/(Benefit) on Other Comprehensive Income/(Loss)      
Reclassification adjustments of certain tax effects from AOCI to Retained earnings [4] 1 0 0
Reclassification adjustments of certain tax effects from AOCI to Retained earnings [4] 637 0 0
Reclassification adjustments of certain tax effects from AOCI to Retained earnings [4] (144) 0 0
Financial Assets and Liabilities [Member]      
Tax Expense/(Benefit) on Other Comprehensive Income/(Loss)      
Reclassification adjustments for tax on unrealized gains from AOCI to Retained earnings [5] $ (45) $ 0 $ 0
[1] Taxes are not provided for foreign currency translation adjustments relating to investments in international subsidiaries that will be held indefinitely.
[2] Amounts may not add due to rounding.
[3] See Note 5E. Tax Matters: Tax Provision/(Benefit) on Other Comprehensive Income/(Loss).
[4] For additional information on the adoption of a new accounting standard related to reclassification of certain tax effects from AOCI, see Note 1B.
[5] For additional information on the adoption of a new accounting standard related to financial assets and liabilities, see Note 1B.
v3.10.0.1
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Jan. 01, 2018
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Beginning balance [1] $ 71,308      
Other comprehensive income/(loss) [2]   $ 1,715 $ (1,514)  
Ending balance [1] 63,407 71,308    
Accumulated Other Comprehensive Income/(Loss) [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Beginning balance (9,321) (11,036) (9,522)  
Other comprehensive income/(loss) [2] (1,041)      
Other comprehensive income/(loss) due to the adoption of new accounting standards [3]       $ (913)
Ending balance (11,275) (9,321) (11,036)  
Foreign Currency Translation Adjustments [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Beginning balance (5,180) (6,659) (5,863)  
Other comprehensive income/(loss) [2] (893) 1,479 (797)  
Ending balance (6,075) (5,180) (6,659)  
Derivative Financial Instruments [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Beginning balance (30) 348 421  
Other comprehensive income/(loss) [2] 198 (378) (73)  
Ending balance 167 (30) 348  
Available-For-Sale Securities [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Beginning balance 401 (131) (227)  
Other comprehensive income/(loss) [2] (53) 532 96  
Ending balance (68) 401 (131)  
Actuarial Gains/(Losses) [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Beginning balance (5,262) (5,473) (4,733)  
Other comprehensive income/(loss) [2] (128) 211 (740)  
Ending balance (6,027) (5,262) (5,473)  
Prior Service (Costs)/Credits and Other [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Beginning balance 750 879 880  
Other comprehensive income/(loss) [2] (166) (129) (1)  
Ending balance $ 728 $ 750 $ 879  
Financial Assets and Liabilities [Member] | Foreign Currency Translation Adjustments [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Other comprehensive income/(loss) due to the adoption of new accounting standards [3]       (2)
Financial Assets and Liabilities [Member] | Available-For-Sale Securities [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Other comprehensive income/(loss) due to the adoption of new accounting standards [3]       (416)
Reclassification of Certain Tax Effects from AOCI [Member] | Derivative Financial Instruments [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Other comprehensive income/(loss) due to the adoption of new accounting standards [3]       (1)
Reclassification of Certain Tax Effects from AOCI [Member] | Actuarial Gains/(Losses) [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Other comprehensive income/(loss) due to the adoption of new accounting standards [3]       (637)
Reclassification of Certain Tax Effects from AOCI [Member] | Prior Service (Costs)/Credits and Other [Member]        
Accumulated Other Comprehensive Income (Loss) [Roll Forward]        
Other comprehensive income/(loss) due to the adoption of new accounting standards [3]       $ 144
[1] Amounts may not add due to rounding.
[2] Amounts do not include foreign currency translation adjustments attributable to noncontrolling interests of $20 million loss in 2018, $14 million income in 2017 and $3 million loss in 2016.
[3] Amounts represent the cumulative effect adjustments as of January 1, 2018 from the adoption of new accounting standards related to (i) financial assets and liabilities and (ii) the reclassification of certain tax effects from AOCI. For additional information, see Note 1B.
v3.10.0.1
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests - Footnotes (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Equity [Abstract]      
Foreign currency translation income (loss) attributable to noncontrolling interests $ (20) $ 14 $ (3)
v3.10.0.1
Accumulated Other Comprehensive Loss, Excluding Noncontrolling Interests - Narrative (Details)
$ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
Derivative Financial Instruments [Member]  
Accumulated Other Comprehensive Income (Loss) [Line Items]  
Gain (loss) to be reclassified in next twelve months $ 258
Actuarial Gains/(Losses) [Member]  
Accumulated Other Comprehensive Income (Loss) [Line Items]  
Gain (loss) to be reclassified in next twelve months (242)
Prior Service (Costs)/Credits and Other [Member]  
Accumulated Other Comprehensive Income (Loss) [Line Items]  
Gain (loss) to be reclassified in next twelve months $ 186
v3.10.0.1
Financial Instruments - Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities $ 1,600 $ 2,150
Total assets [1] 159,422 171,797
Total liabilities 1,024 691
Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total assets 19,595 24,937
Total liabilities 1,024 691
Government and agency debt - non-U.S. [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 9,703 12,629
Corporate and Other [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities [2] 5,878 7,823
Level 1 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total assets 1,260 1,523
Total liabilities 0 0
Level 2 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Total assets 18,335 23,414
Total liabilities 1,024 691
Short-term Investments [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 1,600 2,150
Available-for-sale securities, debt securities 15,091 15,362
Total short-term investments 16,691 17,512
Short-term Investments [Member] | Money market funds [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 1,571 2,115
Short-term Investments [Member] | Equity [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 29 35
Short-term Investments [Member] | Government and agency debt - non-U.S. [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 9,609 12,242
Short-term Investments [Member] | Corporate and Other [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 5,482 3,120
Short-term Investments [Member] | Level 1 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 17 16
Available-for-sale securities, debt securities 0 0
Total short-term investments 17 16
Short-term Investments [Member] | Level 1 [Member] | Money market funds [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 0 0
Short-term Investments [Member] | Level 1 [Member] | Equity [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 17 16
Short-term Investments [Member] | Level 1 [Member] | Government and agency debt - non-U.S. [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 0 0
Short-term Investments [Member] | Level 1 [Member] | Corporate and Other [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 0 0
Short-term Investments [Member] | Level 2 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 1,583 2,134
Available-for-sale securities, debt securities 15,091 15,362
Total short-term investments 16,674 17,496
Short-term Investments [Member] | Level 2 [Member] | Money market funds [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 1,571 2,115
Short-term Investments [Member] | Level 2 [Member] | Equity [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 11 19
Short-term Investments [Member] | Level 2 [Member] | Government and agency debt - non-U.S. [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 9,609 12,242
Short-term Investments [Member] | Level 2 [Member] | Corporate and Other [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 5,482 3,120
Other Current Assets [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 574 337
Other Current Assets [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 97 104
Other Current Assets [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 477 234
Other Current Assets [Member] | Level 1 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 0 0
Other Current Assets [Member] | Level 1 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 0 0
Other Current Assets [Member] | Level 1 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 0 0
Other Current Assets [Member] | Level 2 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 574 337
Other Current Assets [Member] | Level 2 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 97 104
Other Current Assets [Member] | Level 2 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative assets 477 234
Long-term Investments [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 491 5,090
Trading funds and securities 1,273 1,514
Total long-term investments 1,764 6,603
Long-term Investments [Member] | Equity [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 1,223 1,440
Long-term Investments [Member] | Trading securities [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 50 73
Long-term Investments [Member] | Government and agency debt - non-U.S. [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 94 387
Long-term Investments [Member] | Corporate and Other [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 397 4,702
Long-term Investments [Member] | Level 1 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 0 36
Trading funds and securities 1,243 1,472
Total long-term investments 1,243 1,507
Long-term Investments [Member] | Level 1 [Member] | Equity [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 1,193 1,398
Long-term Investments [Member] | Level 1 [Member] | Trading securities [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 50 73
Long-term Investments [Member] | Level 1 [Member] | Government and agency debt - non-U.S. [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 0 0
Long-term Investments [Member] | Level 1 [Member] | Corporate and Other [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 0 36
Long-term Investments [Member] | Level 2 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 491 5,054
Trading funds and securities 30 42
Total long-term investments 521 5,096
Long-term Investments [Member] | Level 2 [Member] | Equity [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 30 42
Long-term Investments [Member] | Level 2 [Member] | Trading securities [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Equity securities 0 0
Long-term Investments [Member] | Level 2 [Member] | Government and agency debt - non-U.S. [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 94 387
Long-term Investments [Member] | Level 2 [Member] | Corporate and Other [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Available-for-sale securities, debt securities 397 4,667
Other Noncurrent Assets [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 566 484
Other Noncurrent Assets [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 335 477
Other Noncurrent Assets [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 232 7
Other Noncurrent Assets [Member] | Level 1 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 0 0
Other Noncurrent Assets [Member] | Level 1 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 0 0
Other Noncurrent Assets [Member] | Level 1 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 0 0
Other Noncurrent Assets [Member] | Level 2 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 566 484
Other Noncurrent Assets [Member] | Level 2 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 335 477
Other Noncurrent Assets [Member] | Level 2 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative assets 232 7
Other Current Liabilities [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 82 201
Other Current Liabilities [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 5 1
Other Current Liabilities [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 78 201
Other Current Liabilities [Member] | Level 1 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 0 0
Other Current Liabilities [Member] | Level 1 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 0 0
Other Current Liabilities [Member] | Level 1 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 0 0
Other Current Liabilities [Member] | Level 2 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 82 201
Other Current Liabilities [Member] | Level 2 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 5 1
Other Current Liabilities [Member] | Level 2 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Current derivative liabilities 78 201
Other Noncurrent Liabilities [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 942 490
Other Noncurrent Liabilities [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 378 177
Other Noncurrent Liabilities [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 564 313
Other Noncurrent Liabilities [Member] | Level 1 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 0 0
Other Noncurrent Liabilities [Member] | Level 1 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 0 0
Other Noncurrent Liabilities [Member] | Level 1 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 0 0
Other Noncurrent Liabilities [Member] | Level 2 [Member] | Recurring [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 942 490
Other Noncurrent Liabilities [Member] | Level 2 [Member] | Recurring [Member] | Interest rate contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities 378 177
Other Noncurrent Liabilities [Member] | Level 2 [Member] | Recurring [Member] | Foreign exchange contracts [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Noncurrent derivative liabilities $ 564 $ 313
[1] Amounts may not add due to rounding.
[2] Primarily issued by a diverse group of corporations.
v3.10.0.1
Financial Instruments - Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis - Footnotes (Details) - Recurring [Member] - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Short-term equity securities held in trust $ 11 $ 19
Long-term equity securities held in trust $ 29 $ 42
v3.10.0.1
Financial Instruments - Assets and Liabilities Not Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Carrying Value [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Long-term debt, excluding the current portion $ 32,909 $ 33,538
Estimated Fair Value [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Long-term debt, excluding the current portion 35,260 37,253
Level 2 [Member] | Estimated Fair Value [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Long-term debt, excluding the current portion $ 35,260 $ 37,253
v3.10.0.1
Financial Instruments - Total Short-term and Long-term Investments (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Short-term investments    
Equity securities $ 1,600 $ 2,150
Available-for-sale debt securities 15,091 15,362
Held-to-maturity debt securities 1,003 1,138
Total Short-term investments [1] 17,694 18,650
Long-term investments    
Equity securities 1,223 1,440
Trading equity securities 50 73
Available-for-sale debt securities 491 5,090
Held-to-maturity debt securities 59 4
Private equity investments carried at equity-method or cost 944 408
Total Long-term investments [1] 2,767 7,015
Held-to-maturity cash equivalents $ 199 $ 719
[1] Amounts may not add due to rounding.
v3.10.0.1
Financial Instruments - Investments (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Debt Securities, Held-to-maturity, Maturity, Fair Value [Abstract]    
Debt securities, amortized cost $ 16,920 $ 22,337
Debt securities, gross unrealized gains 8 77
Debt securities, gross unrealized losses (85) (100)
Debt securities maturities, within 1 year, fair value 16,293  
Debt securities maturities, over 1 to 5 years, fair value 512  
Debt securities maturities, over 5 years, fair value 38  
Debt Securities, Available-for-sale and Held-to-maturity 16,842 22,313
Available-for-sale Equity Securities [Abstract]    
Available-for-sale equity securities, amortized cost [1]   2,843
Available-for-sale equity securities, gross unrealized gain [1]   586
Available-for-sale equity securities, gross unrealized losses [1]   (124)
Available-for-sale securities, equity securities [1]   3,304
Government and agency debt - non-U.S. [Member]    
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]    
Available-for-sale debt securities, amortized cost 9,754 12,616
Available-for-sale debt securities, gross unrealized gain 7 61
Available-for-sale debt securities, gross unrealized loss (58) (48)
Available-for-sale securities, debt maturities 9,703 12,629
Available-for-sale Securities, Debt Maturities [Abstract]    
Available-for-sale securities, debt maturities, within 1 year, fair value 9,609  
Available-for-sale securities, debt maturities, over 1 to 5 years, fair value 94  
Available-for-sale securities, debt maturities, over 5 years, fair value 0  
Available-for-sale securities, debt maturities 9,703 12,629
Debt Securities, Held-to-maturity, Maturity [Abstract]    
Held-to-maturity securities, debt maturities, total 592 770
Held-to-maturity securities, gross unrealized gains 0 0
Held-to-maturity securities, gross unrealized losses 0 0
Held-to-maturity securities, fair value 592 770
Debt Securities, Held-to-maturity, Maturity, Fair Value [Abstract]    
Held-to-maturity securities, debt maturities, within 1 year, fair value 592  
Held-to-maturity securities, debt maturities, over 1 to 5 years, fair value 0  
Held-to-maturity securities, debt maturities, over 5 years, fair value 0  
Corporate and Other [Member]    
Debt Securities, Available-for-sale, Fair Value to Amortized Cost [Abstract]    
Available-for-sale debt securities, amortized cost [2] 5,905 7,859
Available-for-sale debt securities, gross unrealized gain [2] 0 15
Available-for-sale debt securities, gross unrealized loss [2] (27) (52)
Available-for-sale securities, debt maturities [2] 5,878 7,823
Available-for-sale Securities, Debt Maturities [Abstract]    
Available-for-sale securities, debt maturities, within 1 year, fair value [2] 5,482  
Available-for-sale securities, debt maturities, over 1 to 5 years, fair value [2] 394  
Available-for-sale securities, debt maturities, over 5 years, fair value [2] 3  
Available-for-sale securities, debt maturities [2] 5,878 7,823
Time deposits and other [Member]    
Debt Securities, Held-to-maturity, Maturity [Abstract]    
Held-to-maturity securities, debt maturities, total 668 1,091
Held-to-maturity securities, gross unrealized gains 0 0
Held-to-maturity securities, gross unrealized losses 0 0
Held-to-maturity securities, fair value 668 1,091
Debt Securities, Held-to-maturity, Maturity, Fair Value [Abstract]    
Held-to-maturity securities, debt maturities, within 1 year, fair value 610  
Held-to-maturity securities, debt maturities, over 1 to 5 years, fair value 24  
Held-to-maturity securities, debt maturities, over 5 years, fair value $ 35  
Money market funds [Member]    
Available-for-sale Equity Securities [Abstract]    
Available-for-sale equity securities, amortized cost [1]   2,115
Available-for-sale equity securities, gross unrealized gain [1]   0
Available-for-sale equity securities, gross unrealized losses [1]   0
Available-for-sale securities, equity securities [1]   2,115
Equity [Member]    
Available-for-sale Equity Securities [Abstract]    
Available-for-sale equity securities, amortized cost [1]   728
Available-for-sale equity securities, gross unrealized gain [1]   586
Available-for-sale equity securities, gross unrealized losses [1]   (124)
Available-for-sale securities, equity securities [1]   $ 1,190
[1] Upon the 2018 adoption of a new accounting standard related to financial assets and liabilities, available-for-sale equity securities were classified as equity securities. For additional information see Note 1B.
[2] Primarily issued by a diverse group of corporations.
v3.10.0.1
Financial Instruments - Investments - Unrealized Gains and Losses Related to Equity Securities (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Financial Instruments [Abstract]      
Net gains recognized during the period on investments in equity securities [2] $ 586 [1] $ 224 $ 18
Less: Net gains recognized during the period on equity securities sold during the period (109)    
Net unrealized gains during the reporting period on equity securities still held at the reporting date $ 477    
[1] The net gains on investments in equity securities are reported in Other (income)/deductions––net and, for 2018, include unrealized net gains on equity securities reflecting the adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 4.
[2] The net gains on investments in equity securities in 2018, include unrealized net gains on equity securities of $477 million, reflecting the adoption of a new accounting standard in the first quarter of 2018. Net gains in 2018 were primarily driven by unrealized gains of $466 million related to our investment in Allogene. Prior to the adoption of a new accounting standard in the first quarter of 2018, net unrealized gains and losses on virtually all equity securities with readily determinable fair values were reported in Accumulated other comprehensive income. For additional information, see Note 1B, Note 2B and Note 7B.
v3.10.0.1
Financial Instruments - Investments - Unrealized Gains and Losses Related to Equity Securities - Footnotes (Details)
$ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]  
Unrealized gain on equity securities $ 477
Financial Assets and Liabilities [Member]  
New Accounting Pronouncements or Change in Accounting Principle [Line Items]  
Unrealized gain on equity securities $ 477
v3.10.0.1
Financial Instruments - Short-Term Borrowings (Details) - USD ($)
Dec. 31, 2018
Dec. 31, 2017
Jun. 24, 2016
Short-term Debt [Line Items]      
Commercial paper $ 3,100,000,000 $ 6,100,000,000  
Current portion of long-term debt, principal amount [1] 4,781,000,000 3,532,000,000  
Other short-term borrowings [2] 966,000,000 320,000,000  
Total short-term borrowings, principal amount 8,847,000,000 9,951,000,000  
Net fair value adjustments related to hedging and purchase accounting (5,000,000) 14,000,000  
Net unamortized discounts, premiums and debt issuance costs (11,000,000) (12,000,000)  
Total Short-term borrowings, including current portion of long-term debt, carried at historical proceeds, as adjusted [3] $ 8,831,000,000 $ 9,953,000,000  
Commercial Paper [Member]      
Short-term Debt [Line Items]      
Commercial paper, weighted average interest rate 2.42% 1.36%  
Anacor [Member]      
Short-term Debt [Line Items]      
Debt assumed     $ 698,000,000
Line of Credit [Member]      
Short-term Debt [Line Items]      
Line of credit facility, maximum borrowing capacity $ 552,539,000    
Line of credit facility, due to expire within one year 502,000,000    
Line of Credit [Member] | Commercial Paper [Member]      
Short-term Debt [Line Items]      
Line of credit facility, maximum borrowing capacity 7,000,000,000    
Line of credit facility, remaining borrowing capacity $ 7,500,000,000    
[1] For additional information, see Note 7D.
[2] Other short-term borrowings primarily include cash collateral. For additional information, see Note 7F.
[3] Amounts may not add due to rounding.
v3.10.0.1
Financial Instruments - Long-Term Debt, New Issuances (Details) - Senior Notes [Member]
$ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
Debt Instrument [Line Items]  
Principal amount $ 5,000 [1]
Weighted average interest rate 3.56%
Senior Unsecured Debt, 3.000%, Due 2021 [Member]  
Debt Instrument [Line Items]  
Interest rate, percentage 3.00% [2]
Principal amount $ 1,000 [2]
Senior Unsecured Debt, LIBOR Plus 0.33% Floating Rate Notes [Member]  
Debt Instrument [Line Items]  
Principal amount $ 300 [3]
Senior Unsecured Debt, LIBOR Plus 0.33% Floating Rate Notes [Member] | London Interbank Offered Rate (LIBOR) [Member]  
Debt Instrument [Line Items]  
Basis spread 0.33% [3]
Senior Unsecured Debt, 3.200%, Due 2023 [Member]  
Debt Instrument [Line Items]  
Interest rate, percentage 3.20% [2]
Principal amount $ 1,000 [2]
Senior Unsecured Debt, 3.600%, Due 2028 [Member]  
Debt Instrument [Line Items]  
Interest rate, percentage 3.60% [2]
Principal amount $ 1,000 [2]
Senior Unsecured Debt, 4.100%, Due 2038 [Member]  
Debt Instrument [Line Items]  
Interest rate, percentage 4.10% [2]
Principal amount $ 700 [2]
Senior Unsecured Debt, 4.200%, Due 2048 [Member]  
Debt Instrument [Line Items]  
Interest rate, percentage 4.20% [2]
Principal amount $ 1,000 [2]
[1] The weighted-average effective interest rate for the notes at issuance was 3.56%.
[2] Fixed rate notes may be redeemed by us at any time, in whole, or in part, at varying redemption prices plus accrued and unpaid interest.
[3] Floating rate notes may not be redeemed by their terms prior to maturity.
v3.10.0.1
Financial Instruments - Long-Term Debt Narrative (Details)
£ in Millions
 1 Months Ended 12 Months Ended
Jan. 31, 2019
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2017
GBP (£)
Nov. 30, 2016
USD ($)
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2016
USD ($)
 [1]
Jan. 31, 2019
EUR (€)
Dec. 31, 2017
EUR (€)
Dec. 31, 2017
GBP (£)
Mar. 17, 2017
USD ($)
Mar. 06, 2017
EUR (€)
Nov. 21, 2016
USD ($)
Jun. 03, 2016
USD ($)
Debt Instrument [Line Items]                            
Repurchased debt       $ 3,400,000,000                    
Redemption value       3,700,000,000                    
Loss on early retirement of debt   $ 999,000,000   312,000,000 $ 3,000,000 [1] $ 999,000,000 [1] $ 312,000,000              
Senior Unsecured U.K. Pound Debt, 6.50%, Due 2038 [Member]                            
Debt Instrument [Line Items]                            
Loss on early retirement of debt   846,000,000                        
Senior Unsecured Euro Debt, 5.75%, Due 2021 [Member]                            
Debt Instrument [Line Items]                            
Loss on early retirement of debt   $ 153,000,000                        
Senior Notes [Member]                            
Debt Instrument [Line Items]                            
Weighted average interest rate         3.56%                  
Principal amount [2]         $ 5,000,000,000                  
Senior Notes [Member] | Senior Unsecured U.K. Pound Debt, 6.50%, Due 2038 [Member]                            
Debt Instrument [Line Items]                            
Repurchased debt | £                   £ 197        
Interest rate, percentage                 6.50% 6.50%        
Redemption value | £                   £ 1,700        
Amount of debt exchanged     £ 833     $ 1,100,000,000                
Principal amount | £                   £ 470        
Senior Notes [Member] | Senior Unsecured Euro Debt, 5.75%, Due 2021 [Member]                            
Debt Instrument [Line Items]                            
Repurchased debt | €                 € 834,000,000          
Interest rate, percentage                 5.75% 5.75%        
Redemption value | €                 € 1,000,000,000          
Principal amount | €                 € 1,200,000,000          
Unsecured Debt [Member]                            
Debt Instrument [Line Items]                            
Debt instrument, face amount                     $ 1,065,000,000 € 4,000,000,000 $ 6,000,000,000 $ 5,000,000,000
Weighted average interest rate         1.30%       2.40% 2.40% 4.20% 0.23% 3.10% 2.09%
Principal amount         $ 1,800,000,000                  
Unsecured Debt [Member] | Senior Unsecured Debt, 6.20%, Due 2019 [Member]                            
Debt Instrument [Line Items]                            
Repurchased debt       $ 3,270,000,000                    
Interest rate, percentage       6.20%                    
Subsequent Event [Member] | Senior Unsecured Euro Debt, 5.75%, Due 2021 [Member]                            
Debt Instrument [Line Items]                            
Loss on early retirement of debt $ (138,000,000)                          
Subsequent Event [Member] | Senior Notes [Member] | Senior Unsecured Euro Debt, 5.75%, Due 2021 [Member]                            
Debt Instrument [Line Items]                            
Repurchased debt | €               € 1,100,000,000            
Interest rate, percentage               5.75%            
Redemption value | €               € 1,300,000,000            
[1] In 2017 and 2016, represents net losses due to the early retirement of debt, inclusive of the related termination of cross currency swaps in 2017 and inclusive of the related termination of interest rate swaps in 2016.
[2] The weighted-average effective interest rate for the notes at issuance was 3.56%.
v3.10.0.1
Financial Instruments - Long-Term Debt (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Mar. 17, 2017
Mar. 06, 2017
Nov. 21, 2016
Jun. 03, 2016
Debt Instrument [Line Items]            
Net fair value adjustments related to hedging and purchase accounting $ (5) $ 14        
Net unamortized discounts, premiums and debt issuance costs (11) (12)        
Total long-term debt, carried at historical proceeds, as adjusted [1] 32,909 33,538        
Current portion of long-term debt, carried at historical proceeds (not included above (1.3% and 2.4%)) [1] $ 4,776 $ 3,546        
Unsecured Debt [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 1.30% 2.40% 4.20% 0.23% 3.10% 2.09%
Total principal amount of long-term debt $ 32,558 $ 32,783        
Net fair value adjustments related to hedging and purchase accounting 479 872        
Net unamortized discounts, premiums and debt issuance costs (136) (125)        
Other long-term debt 7 8        
Total long-term debt, carried at historical proceeds, as adjusted 32,909 33,538        
Current portion of long-term debt, carried at historical proceeds (not included above (1.3% and 2.4%)) $ 4,776 3,546        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2019 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage [2] 1.30%          
Total principal amount of long-term debt [2] $ 0 $ 4,848        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2020 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 1.20% 1.10%        
Total principal amount of long-term debt $ 1,474 $ 1,528        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2021 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 3.40% 3.50%        
Total principal amount of long-term debt $ 4,459 $ 3,550        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2022 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 0.30% 0.30%        
Total principal amount of long-term debt $ 1,145 $ 1,199        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2023 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 3.60% 4.30%        
Total principal amount of long-term debt $ 2,892 $ 1,592        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2024 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 4.40% 4.40%        
Total principal amount of long-term debt $ 1,500 $ 1,500        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2026-2028 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 3.30% 3.20%        
Total principal amount of long-term debt $ 5,718 $ 4,759        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2034 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 6.50% 6.50%        
Total principal amount of long-term debt $ 750 $ 750        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2036-2039 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 6.00% 6.20%        
Total principal amount of long-term debt $ 7,301 $ 6,636        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2040-2044 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 3.80% 3.80%        
Total principal amount of long-term debt $ 4,004 $ 4,106        
Unsecured Debt [Member] | Senior Unsecured Debt, Due 2046-2048 [Member]            
Debt Instrument [Line Items]            
Interest rate, percentage 4.20% 4.20%        
Total principal amount of long-term debt $ 3,315 $ 2,315        
[1] Amounts may not add due to rounding.
[2] At December 31, 2018, the debt issuances have been reclassified to the current portion of long-term debt.
v3.10.0.1
Financial Instruments - Other Noncurrent Liabilities (Details) - USD ($)
$ in Millions
 1 Months Ended 3 Months Ended 12 Months Ended
Apr. 30, 2018
Dec. 31, 2017
Aug. 31, 2017
Jun. 30, 2017
Sep. 30, 2018
Jul. 01, 2018
Dec. 31, 2018
Aug. 31, 2018
Jun. 30, 2018
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net   $ 36,562         $ 31,045    
Mylotarg [Member] | EU [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Research and development arrangement, aggregate payment obligation, term 10 years                
Aggregate amount of guaranteed fixed annual payments to be made in connection with research and development arrangement $ 301                
Bosulif [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Research and development arrangement, aggregate payment obligation, term             9 years    
Bosulif [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Research and development arrangement, aggregate payment obligation, term   10 years              
Aggregate amount of guaranteed fixed annual payments to be made in connection with research and development arrangement   $ 416         $ 240    
Besponsa [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Research and development arrangement, aggregate payment obligation, term             8 years    
Aggregate amount of guaranteed fixed annual payments to be made in connection with research and development arrangement             $ 422    
Besponsa [Member] | EU [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Research and development arrangement, aggregate payment obligation, term       9 years          
Aggregate amount of guaranteed fixed annual payments to be made in connection with research and development arrangement       $ 148          
Besponsa [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Research and development arrangement, aggregate payment obligation, term     9 years            
Aggregate amount of guaranteed fixed annual payments to be made in connection with research and development arrangement     $ 296            
Developed Technology Rights [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net [1]   34,765         30,535    
Developed Technology Rights [Member] | Mylotarg [Member] | EU [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net $ 240                
Lump sum payment for liability buyout                 $ 224
Non-cash gain from buyout transaction           $ 17 17    
Developed Technology Rights [Member] | Bosulif [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net   $ 364         209    
Lump sum payment for liability buyout               $ 71  
Non-cash gain from buyout transaction         $ 9        
Developed Technology Rights [Member] | Besponsa [Member] | EU [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net       $ 123     122    
Developed Technology Rights [Member] | Besponsa [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net     $ 248       243    
Other Noncurrent Liabilities [Member] | Developed Technology Rights [Member] | Bosulif [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net             186    
Other Noncurrent Liabilities [Member] | Developed Technology Rights [Member] | Besponsa [Member] | EU [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net             119    
Other Noncurrent Liabilities [Member] | Developed Technology Rights [Member] | Besponsa [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net             235    
Other current liabilities [Member] | Developed Technology Rights [Member] | Bosulif [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net             23    
Other current liabilities [Member] | Developed Technology Rights [Member] | Besponsa [Member] | EU [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net             3    
Other current liabilities [Member] | Developed Technology Rights [Member] | Besponsa [Member] | United States [Member]                  
Finite-Lived Intangible Assets [Line Items]                  
Finite-lived intangible assets, net             $ 7    
[1] The changes in the gross carrying amount of Developed technology rights, Brands, Brands and other and IPR&D primarily reflect (i) the reclassification of $6.1 billion of Brands and Brands and other to Assets held for sale during the fourth quarter of 2018 (see Note 2C), (ii) the transfer of $2.7 billion from IPR&D to Developed technology rights to reflect the approval of Xtandi in the U.S. for the treatment of men with non-metastatic castration-resistant prostate cancer, which is being developed through a collaboration with Astellas (see Note 2A), (iii) $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E), as well as impairments of $2.9 billion of Developed technology rights (see Note 4).
v3.10.0.1
Financial Instruments - Fair Value of Derivative Financial Instruments and Related Notional Amounts (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Derivative [Line Items]    
Derivative asset $ 1,140 $ 822
Derivative liability 1,024 691
Designated as Hedging Instrument [Member]    
Derivative [Line Items]    
Derivative asset 1,085 760
Derivative liability 968 637
Foreign exchange contracts [Member] | Designated as Hedging Instrument [Member]    
Derivative [Line Items]    
Derivative, notional amount [1] 22,984 18,723
Derivative asset [1] 654 179
Derivative liability [1] 586 459
Foreign exchange contracts [Member] | Not Designated as Hedging Instrument [Member]    
Derivative [Line Items]    
Derivative, notional amount 15,154 14,300
Derivative asset 55 62
Derivative liability 55 54
Interest rate contracts [Member] | Designated as Hedging Instrument [Member]    
Derivative [Line Items]    
Derivative, notional amount 11,145 12,430
Derivative asset 432 581
Derivative liability 383 $ 178
Sales [Member] | Foreign exchange contracts [Member] | Designated as Hedging Instrument [Member]    
Derivative [Line Items]    
Derivative, notional amount $ 5,800  
[1] As of December 31, 2018, the notional amount of outstanding foreign currency forward-exchange contracts hedging our intercompany forecasted inventory sales was $5.8 billion.The following table provides information about the gains/(losses) incurred to hedge or offset operational foreign exchange or interest rate risk: Amount ofGains/(Losses)Recognized in OID(a), (b) Amount of Gains/(Losses)Recognized in OCI(a), (c) Amount of Gains/(Losses)Reclassified fromOCI into OID and COS(a), (c) As of December 31,(MILLIONS OF DOLLARS) 2018 2017 2018 2017 2018 2017Derivative Financial Instruments in Cash Flow Hedge Relationships: Foreign exchange contracts(d) $— $(6) $80 $(12) $(182) $520Amount excluded from effectiveness testing recognized in earnings based on an amortization approach — 140 153 Derivative Financial Instruments in Fair Value Hedge Relationships: Interest rate contracts (348) (60) — — — —Hedged item gain 348 60 — — — —Foreign exchange contracts 5 (19) — — — —Hedged item gain/(loss) (5) 19 — — — — Derivative Financial Instruments in Net Investment Hedge Relationships: Foreign exchange contracts — — 175 — — —The portion of gains/(losses) on foreign exchange contracts excluded from the assessment of hedge effectiveness — 77 68 Non-Derivative Financial Instruments in Net Investment Hedge Relationships: Foreign currency short-term borrowings — — 68 — — —Foreign currency long-term debt(e) — — 149 (580) — — Derivative Financial Instruments Not Designated as Hedges: Foreign exchange contracts 136 (87) — — — —All other net — — (1) 2 2 1 $136 $(93) $688 $(591) $41 $520
v3.10.0.1
Financial Instruments - Derivative Financial Instruments and Hedging Activities (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] $ 688 $ (591)
Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] 136 (93)
Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 41 520
Net Investment Hedging, Nonderivative Instruments [Member] | Foreign currency short-term borrowings [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] 68 0
Net Investment Hedging, Nonderivative Instruments [Member] | Foreign currency short-term borrowings [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] 0 0
Net Investment Hedging, Nonderivative Instruments [Member] | Foreign currency short-term borrowings [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 0 0
Net Investment Hedging, Nonderivative Instruments [Member] | Foreign currency long-term debt [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2],[4] 149 (580)
Net Investment Hedging, Nonderivative Instruments [Member] | Foreign currency long-term debt [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3],[4] 0 0
Net Investment Hedging, Nonderivative Instruments [Member] | Foreign currency long-term debt [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2],[4] 0 0
All other, net [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] (1) 2
All other, net [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] 0 0
All other, net [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 2 1
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Foreign exchange contracts [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount excluded from effectiveness testing recognized in earnings based on an amortization approach [1],[2] 140  
Amount of Gains/(Losses) Recognized in OCI [1],[2],[5] 80 (12)
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3],[5] 0 (6)
Amount excluded from effectiveness testing recognized in earnings based on an amortization approach [2],[3] 0  
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount excluded from effectiveness testing recognized in earnings based on an amortization approach [1],[2] 153  
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2],[5] (182) 520
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Foreign exchange contracts [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] 0 0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] 5 (19)
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 0 0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Interest rate contracts [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] 0 0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Interest rate contracts [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] (348) (60)
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Interest rate contracts [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 0 0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Interest rate contracts, hedged item gain (loss) [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] 0 0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Interest rate contracts, hedged item gain (loss) [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] 348 60
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Interest rate contracts, hedged item gain (loss) [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 0 0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Foreign exchange contracts, hedged item gain (loss) [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] 0 0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Foreign exchange contracts, hedged item gain (loss) [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] (5) 19
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Foreign exchange contracts, hedged item gain (loss) [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 0 0
Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Foreign exchange contracts [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
The portion of gains/(losses) on foreign exchange contracts excluded from the assessment of hedge effectiveness [1],[2] 77  
Amount of Gains/(Losses) Recognized in OCI [1],[2] 175 0
Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] 0 0
The portion of gains/(losses) on foreign exchange contracts excluded from the assessment of hedge effectiveness [2],[3] 0  
Designated as Hedging Instrument [Member] | Net Investment Hedging [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
The portion of gains/(losses) on foreign exchange contracts excluded from the assessment of hedge effectiveness [1],[2] 68  
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] 0 0
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts [Member] | Other Comprehensive Income (Loss) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OCI [1],[2] 0 0
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Recognized in OID [2],[3] 136 (87)
Not Designated as Hedging Instrument [Member] | Foreign exchange contracts [Member] | Other Nonoperating Income (Expense) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]    
Derivative Instruments, Gain (Loss) [Line Items]    
Amount of Gains/(Losses) Reclassified from OCI into OID and COS [1],[2] $ 0 $ 0
[1] For derivative financial instruments in cash flow hedge relationships, the gains and losses are included in Other comprehensive income/(loss)––Unrealized holding gains/(losses) on derivative financial instruments, net. For derivative financial instruments in net investment hedge relationships and for foreign currency debt designated as hedging instruments, the effective portion is included in Other comprehensive income/(loss)––Foreign currency translation adjustments, net.
[2] OID = Other (income)/deductions—net, included in Other (income)/deductions—net in the consolidated statements of income. COS = Cost of Sales, included in Cost of sales in the consolidated statements of income. OCI = Other comprehensive income/(loss), included in the consolidated statements of comprehensive income.
[3] For 2017, there is no significant ineffectiveness.
[4] Short-term borrowings include foreign currency short-term borrowings with carrying values of $1.4 billion as of December 31, 2018, which are used as hedging instruments in net investment hedges. Long-term debt includes foreign currency long-term borrowings with carrying values of $3.2 billion as of December 31, 2018, which are used as hedging instruments in net investment hedges.
[5] Based on year-end foreign exchange rates that are subject to change, we expect to reclassify a pre-tax gain of $156 million within the next 12 months into Cost of sales. The maximum length of time over which we are hedging future foreign exchange cash flow relates to our $1.8 billion U.K. pound debt maturing in 2043.
v3.10.0.1
Financial Instruments - Derivative Financial Instruments and Hedging Activities - Footnotes (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Derivative [Line Items]    
Amount of pre-tax loss to be reclassified $ 156  
Carrying value of short-term borrowings [1] 8,831 $ 9,953
Foreign currency short-term borrowings [Member]    
Derivative [Line Items]    
Carrying value of short-term borrowings 1,400  
Foreign currency long-term debt [Member]    
Derivative [Line Items]    
Principal amount 3,200  
Unsecured Debt [Member]    
Derivative [Line Items]    
Principal amount $ 1,800  
[1] Amounts may not add due to rounding.
v3.10.0.1
Financial Instruments - Fair Value And Cash Flow Hedges (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Financial Instruments [Abstract]      
Cost of sales [1],[2] $ 11,248 $ 11,228 $ 12,322
Other (income)/deductions—net [1] $ (2,116) $ (1,416) $ (3,794)
[1] Amounts may not add due to rounding.
[2] Exclusive of amortization of intangible assets, except as disclosed in Note 1L. Basis of Presentation and Significant Accounting Policies: Amortization of Intangible Assets, Depreciation and Certain Long-Lived Assets.
v3.10.0.1
Financial Instruments - Cumulative Basis Adjustments for Fair Value Hedges (Details)
$ in Millions
Dec. 31, 2018
USD ($)
Long-term investments [Member]  
Derivative [Line Items]  
Carrying Amount of Hedged Assets $ 45
Cumulative Amount of Fair Value Hedging Adjustment Gains/(Losses) Included in the Carrying Amount of the Hedged Assets (1)
Short-term borrowings, including current portion of long-term debt [Member]  
Derivative [Line Items]  
Carrying Amount of Hedged Liabilities 1,499
Cumulative Amount of Fair Value Hedging Adjustment Gains/(Losses) Included in the Carrying Amount of the Hedged Liabilities 5
Long-term debt [Member]  
Derivative [Line Items]  
Carrying Amount of Hedged Liabilities 9,952
Cumulative Amount of Fair Value Hedging Adjustment Gains/(Losses) Included in the Carrying Amount of the Hedged Liabilities $ 45
v3.10.0.1
Financial Instruments - Narrative (Details)
$ in Millions
Dec. 31, 2018
USD ($)
Financial Instruments [Abstract]  
Derivatives in a net liability position $ 472
Collateral posted 544
Cash collateral received $ 881
v3.10.0.1
Financial Instruments - Credit Risk (Details)
$ in Billions
 12 Months Ended
Dec. 31, 2018
USD ($)
Bank sector [Member]  
Concentration Risk [Line Items]  
Maximum exposure, amount $ 4.4
v3.10.0.1
Inventories (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Jan. 01, 2018
Dec. 31, 2017
Inventory Disclosure [Abstract]      
Finished goods $ 2,262   $ 2,883
Work in process 4,701   3,908
Raw materials and supplies 546   788
Inventories 7,508 [1] $ 7,567 7,578 [1]
Noncurrent inventories not included above 618   $ 683
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | Consumer Healthcare [Member]      
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]      
Reclassification to assets held for sale $ 538    
[1] Amounts may not add due to rounding.
v3.10.0.1
Property, Plant and Equipment (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Property, Plant and Equipment [Line Items]      
Total property, plant and equipment before accumulated depreciation $ 29,977 $ 30,037  
Less: Accumulated depreciation 16,591 16,172  
Property, plant and equipment 13,385 [1],[2] 13,865 [1],[2] $ 13,318
Land [Member]      
Property, Plant and Equipment [Line Items]      
Total property, plant and equipment before accumulated depreciation 500 540  
Buildings [Member]      
Property, Plant and Equipment [Line Items]      
Total property, plant and equipment before accumulated depreciation 9,920 10,254  
Machinery and equipment [Member]      
Property, Plant and Equipment [Line Items]      
Total property, plant and equipment before accumulated depreciation 11,871 11,902  
Furniture, fixtures and other [Member]      
Property, Plant and Equipment [Line Items]      
Total property, plant and equipment before accumulated depreciation 4,693 4,661  
Construction in progress [Member]      
Property, Plant and Equipment [Line Items]      
Total property, plant and equipment before accumulated depreciation $ 2,992 2,680  
Minimum [Member] | Buildings [Member]      
Property, Plant and Equipment [Line Items]      
Useful lives (years) 33 years    
Minimum [Member] | Machinery and equipment [Member]      
Property, Plant and Equipment [Line Items]      
Useful lives (years) 8 years    
Minimum [Member] | Furniture, fixtures and other [Member]      
Property, Plant and Equipment [Line Items]      
Useful lives (years) 3 years    
Maximum [Member] | Buildings [Member]      
Property, Plant and Equipment [Line Items]      
Useful lives (years) 50 years    
Maximum [Member] | Machinery and equipment [Member]      
Property, Plant and Equipment [Line Items]      
Useful lives (years) 20 years    
Maximum [Member] | Furniture, fixtures and other [Member]      
Property, Plant and Equipment [Line Items]      
Useful lives (years) 12 years 6 months    
Consumer Healthcare [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member]      
Property, Plant and Equipment [Line Items]      
Reclassification of PP&E to assets held for sale $ 675 $ 0  
[1] Amounts may not add due to rounding.
[2] The decrease in total property, plant and equipment is primarily due to depreciation, the reclassification of $675 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C), reductions due to asset impairments largely associated with cost reduction initiatives not associated with acquisitions (see Note 3), and the impact of foreign exchange, partially offset by capital additions.
v3.10.0.1
Identifiable Intangible Assets and Goodwill - Finite-lived and Indefinite-lived Intangible Assets (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]    
Finite-lived intangible assets, gross carrying amount $ 91,788 $ 93,595
Finite-lived intangible assets, accumulated amortization [1] (60,743) (57,033)
Finite-lived intangible assets, less accumulated amortization 31,045 36,562
Indefinite-lived Intangible Assets [Line Items]    
Total indefinite-lived intangible assets 4,165 12,179
Intangible assets, gross carrying amount [1] 95,954 105,774
Identifiable Intangible Assets, less Accumulated Amortization [1],[2] 35,211 48,741
Brands [Member]    
Indefinite-lived Intangible Assets [Line Items]    
Total indefinite-lived intangible assets [3] 1,994 6,929
In Process Research and Development [Member]    
Indefinite-lived Intangible Assets [Line Items]    
Total indefinite-lived intangible assets [3] 2,171 5,249
Developed Technology Rights [Member]    
Finite-Lived Intangible Assets [Line Items]    
Finite-lived intangible assets, gross carrying amount [3] 89,430 89,550
Finite-lived intangible assets, accumulated amortization [3] (58,895) (54,785)
Finite-lived intangible assets, less accumulated amortization [3] 30,535 34,765
Brands [Member]    
Finite-Lived Intangible Assets [Line Items]    
Finite-lived intangible assets, gross carrying amount [3] 923 2,134
Finite-lived intangible assets, accumulated amortization [3] (708) (1,152)
Finite-lived intangible assets, less accumulated amortization [3] 215 982
Licensing Agreements And Other [Member]    
Finite-Lived Intangible Assets [Line Items]    
Finite-lived intangible assets, gross carrying amount 1,436 1,911
Finite-lived intangible assets, accumulated amortization (1,140) (1,096)
Finite-lived intangible assets, less accumulated amortization $ 296 $ 815
[1] The decrease in Identifiable intangible assets, less accumulated amortization, is primarily due to the reclassification of $5.8 billion of intangible assets, net, ($6.3 billion total gross carrying amount) to Assets held for sale during the fourth quarter of 2018 (see Note 2C) and amortization and impairments, partially offset by additions, mainly consisting of $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E).
[2] Amounts may not add due to rounding.
[3] The changes in the gross carrying amount of Developed technology rights, Brands, Brands and other and IPR&D primarily reflect (i) the reclassification of $6.1 billion of Brands and Brands and other to Assets held for sale during the fourth quarter of 2018 (see Note 2C), (ii) the transfer of $2.7 billion from IPR&D to Developed technology rights to reflect the approval of Xtandi in the U.S. for the treatment of men with non-metastatic castration-resistant prostate cancer, which is being developed through a collaboration with Astellas (see Note 2A), (iii) $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E), as well as impairments of $2.9 billion of Developed technology rights (see Note 4).
v3.10.0.1
Identifiable Intangible Assets and Goodwill - Finite-lived and Indefinite-lived Intangible Assets - Footnotes (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Apr. 30, 2018
Dec. 31, 2017
Schedule of Intangible Assets [Line Items]      
Finite-lived intangible assets, net $ 31,045   $ 36,562
In Process Research and Development [Member] | Xtandi [Member]      
Schedule of Intangible Assets [Line Items]      
Transfers in (out) of intangible asset class (2,700)    
Brands [Member]      
Schedule of Intangible Assets [Line Items]      
Finite-lived intangible assets, net [1] 215   982
Developed Technology Rights [Member]      
Schedule of Intangible Assets [Line Items]      
Finite-lived intangible assets, net [1] 30,535   34,765
Impairment of intangible assets, finite-lived [2] 2,900    
Developed Technology Rights [Member] | Xtandi [Member]      
Schedule of Intangible Assets [Line Items]      
Transfers in (out) of intangible asset class 2,700    
European Union [Member] | Developed Technology Rights [Member] | Mylotarg [Member]      
Schedule of Intangible Assets [Line Items]      
Finite-lived intangible assets, net   $ 240  
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | Consumer Healthcare [Member]      
Schedule of Intangible Assets [Line Items]      
Reclassification of net intangible assets to assets held for sale 5,763   $ 0
Reclassification of gross intangible assets to assets held for sale 6,300    
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | Consumer Healthcare [Member] | Brands [Member] | Brands [Member]      
Schedule of Intangible Assets [Line Items]      
Reclassification of net intangible assets to assets held for sale $ 6,100    
[1] The changes in the gross carrying amount of Developed technology rights, Brands, Brands and other and IPR&D primarily reflect (i) the reclassification of $6.1 billion of Brands and Brands and other to Assets held for sale during the fourth quarter of 2018 (see Note 2C), (ii) the transfer of $2.7 billion from IPR&D to Developed technology rights to reflect the approval of Xtandi in the U.S. for the treatment of men with non-metastatic castration-resistant prostate cancer, which is being developed through a collaboration with Astellas (see Note 2A), (iii) $240 million of Developed technology rights recorded in connection with the EU approval of Mylotarg (see Note 7E), as well as impairments of $2.9 billion of Developed technology rights (see Note 4).
[2] Reflects intangible assets written down to fair value in 2018. Fair value was determined using the income approach, specifically the multi-period excess earnings method, also known as the discounted cash flow method. We started with a forecast of all the expected net cash flows associated with the asset and then applied an asset-specific discount rate to arrive at a net present value amount. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the product; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.
v3.10.0.1
Identifiable Intangible Assets and Goodwill - Intangible Assets Percentage of Total Intangibles (Details)
Dec. 31, 2018
Operating Segments [Member] | IH [Member] | Developed Technology Rights [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 76.00%
Operating Segments [Member] | IH [Member] | Brands [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 0.00%
Operating Segments [Member] | EH [Member] | Developed Technology Rights [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 24.00%
Operating Segments [Member] | EH [Member] | Brands [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 100.00%
WRD [Member] | Segment Reconciling Items [Member] | Developed Technology Rights [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 0.00%
WRD [Member] | Segment Reconciling Items [Member] | Brands [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 0.00%
Brands [Member] | Operating Segments [Member] | IH [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 0.00%
Brands [Member] | Operating Segments [Member] | EH [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 100.00%
Brands [Member] | WRD [Member] | Segment Reconciling Items [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 0.00%
IPR&D [Member] | Operating Segments [Member] | IH [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 65.00%
IPR&D [Member] | Operating Segments [Member] | EH [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 18.00%
IPR&D [Member] | WRD [Member] | Segment Reconciling Items [Member]  
Finite-Lived Intangible Assets [Line Items]  
Percentage of intangible asset amortized cost by segment 17.00%
v3.10.0.1
Identifiable Intangible Assets and Goodwill - Narrative (Details) - USD ($)
$ in Billions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Developed Technology Rights [Member]      
Finite-Lived Intangible Assets [Line Items]      
Finite-lived intangible asset, useful life 9 years    
Finite-Lived Intangible Assets [Member]      
Finite-Lived Intangible Assets [Line Items]      
Amortization expense for finite-lived intangible assets $ 5.0 $ 4.8 $ 4.1
v3.10.0.1
Identifiable Intangible Assets and Goodwill - Expected Annual Amortization Expense (Details)
$ in Millions
Dec. 31, 2018
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]  
2019 $ 4,581
2020 3,552
2021 3,467
2022 3,217
2023 $ 2,920
v3.10.0.1
Identifiable Intangible Assets and Goodwill - Goodwill (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Goodwill [Roll Forward]    
Beginning balance $ 55,952 [1] $ 54,449
Additions [2]   664
Other (2,541) [3] 840 [4]
Ending balance [1] 53,411 55,952
Innovative Health Segment [Member]    
Goodwill [Roll Forward]    
Beginning balance 31,141 30,134
Additions [2]   572
Other (2,264) [3] 435 [4]
Ending balance 28,877 31,141
Essential Health Segment [Member]    
Goodwill [Roll Forward]    
Beginning balance 24,811 24,315
Additions [2]   92
Other (277) [3] 404 [4]
Ending balance 24,534 24,811
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | Consumer Healthcare [Member]    
Goodwill [Roll Forward]    
Goodwill $ 1,972 $ 0
[1] Amounts may not add due to rounding.
[2] IH additions primarily represent measurement period adjustments related to our Medivation acquisition, and EH additions relate to our acquisition of AstraZeneca’s small molecule anti-infectives business (see Note 2A).
[3] Primarily reflects the impact of the reclassification of $2.0 billion to Assets held for sale during the fourth quarter of 2018 (see Note 2C), foreign exchange and the contribution of the allogeneic CAR T developmental program assets and operations to Allogene that constituted a business for accounting purposes (see Note 2B).
[4] Primarily reflects the impact of foreign exchange and an adjustment of our estimate of goodwill associated with the HIS net assets sold.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Service cost [1] $ 39 [2],[3] $ 42 [2],[3] $ 41
Interest cost 72 [2],[3] 90 [2],[3] 101
Expected return on plan assets (37) (36) (34)
Amortization of actuarial losses [1] 7 31 32
Amortization of prior service credits/(credits) (178) (182) (174)
Curtailments (17) (19) (26)
Settlements 0 0 0
Special termination benefits 2 [2],[3] 0 [2],[3] 0
Net periodic benefit costs/(income) reported in Income [4] (111) (75) (59)
(Income)/cost reported in Other comprehensive income/(loss) [1],[5] 105 (8) 3
(Income)/cost recognized in Comprehensive income (6) (83) (56)
United States [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Service cost [2],[6] 0 269  
Interest cost [2],[6] 598 634  
Special termination benefits [2],[6] 6 0  
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Service cost [2] 0 24  
Interest cost [2] 55 54  
Special termination benefits [2] 10 0  
Foreign Plan [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Service cost [1] 136 [2],[7] 171 [2],[7] 165
Interest cost 212 [2],[7] 204 [2],[7] 233
Expected return on plan assets (360) (345) (381)
Amortization of actuarial losses [1] 101 116 93
Amortization of prior service credits/(credits) (4) (4) (3)
Curtailments (4) 0 (2)
Settlements 4 4 9
Special termination benefits 0 [2],[7] 1 [2],[7] 1
Net periodic benefit costs/(income) reported in Income [4] 84 147 115
(Income)/cost reported in Other comprehensive income/(loss) [1],[5] 84 (301) 640
(Income)/cost recognized in Comprehensive income 168 (154) 755
Qualified Plan [Member] | United States [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Service cost [1],[8] 0 269 257
Interest cost [8] 598 634 646
Expected return on plan assets [8] (1,040) (1,005) (958)
Amortization of actuarial losses [1],[8] 120 393 395
Amortization of prior service credits/(credits) [8] 2 3 5
Curtailments [8] 12 13 10
Settlements [8] 113 75 90
Special termination benefits [8] 6 0 0
Net periodic benefit costs/(income) reported in Income [4],[8] (189) 382 444
(Income)/cost reported in Other comprehensive income/(loss) [5],[8] 361 141 253
(Income)/cost recognized in Comprehensive income [8] 171 523 697
Nonqualified Plan [Member] | United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Service cost [1] 0 24 18
Interest cost 55 54 53
Expected return on plan assets 0 0 0
Amortization of actuarial losses [1] 13 50 37
Amortization of prior service credits/(credits) (1) (1) (1)
Curtailments 1 1 1
Settlements 26 39 28
Special termination benefits 10 0 0
Net periodic benefit costs/(income) reported in Income [4] 103 166 137
(Income)/cost reported in Other comprehensive income/(loss) [1],[5] (189) 23 121
(Income)/cost recognized in Comprehensive income $ (86) $ 189 $ 258
[1] Effective January 1, 2018, we froze two significant defined benefit pension plans to future benefit accruals in the U.S. and U.K. and as a result, service costs for those plans are eliminated. In addition, due to the plan freeze, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans was extended to the expected life expectancy of the plan participants, whereas the average amortization period in prior years utilized the expected future service period of plan participants.
[2] For the U.S. and international pension plans, the benefit obligation is the PBO. For the postretirement plans, the benefit obligation is the ABO. The ABO for all of our U.S. qualified pension plans was $15.1 billion in 2018 and $16.7 billion in 2017. The ABO for our U.S. supplemental (non-qualified) pension plans was $1.3 billion in 2018 and $1.5 billion in 2017. The ABO for our international pension plans was $9.5 billion in 2018 and $10.1 billion in 2017.
[3] The favorable change in the funded status of our postretirement plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[4] We adopted a new accounting standard on January 1, 2018 that requires the net periodic pension and postretirement benefit costs other than service costs be presented in Other (income)/deductions––net on the consolidated statements of income. For additional information, see Note 1B and Note 4.
[5] In 2017 and 2016, the changes to Other comprehensive (income)/loss for the international plans was impacted by foreign currency movements. For details of the changes in Other comprehensive (income)/loss, see the benefit plan activity in the consolidated statements of comprehensive income.
[6] The favorable change in the funded status of our U.S. qualified plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[7] The favorable change in the international plans’ funded status was primarily due to favorable currency movements, partially offset by a decrease in the actual return on plan assets.
[8] In the second quarter of 2017, we settled the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. We purchased a group annuity contract on behalf of the remaining plan participants with a third-party insurance provider. As a result, we were relieved of the $156 million net pension benefit obligation and recorded a pretax settlement gain of $41 million, partially offset by the recognition of actuarial losses and prior service costs upon plan settlement of approximately $30 million in Other (income)/deductions—net (see Note 3).
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Footnotes (Details)
$ in Millions
 1 Months Ended 3 Months Ended
Apr. 30, 2017
USD ($)
Jul. 02, 2017
USD ($)
Jan. 01, 2018
pension_plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]      
Number of pension plans frozen | pension_plan     2
Hospira [Member] | Pension Plan [Member] | United States [Member]      
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]      
Net pension benefit obligation $ 30    
Pretax settlement gain $ 41    
Qualified Plan [Member] | Hospira [Member] | Pension Plan [Member] | United States [Member]      
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]      
Net pension benefit obligation   $ 156  
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Amounts Expected to be Amortized into Net Periodic Benefit Costs (Details)
$ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
Postretirement Benefits Plan [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Actuarial losses $ (4) [1]
Prior service credits and other 178
Total $ 175
Amortization period 9 years 3 months 18 days
United States [Member] | Pension Plan [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Actuarial losses $ (148) [1]
Prior service credits and other 3
Total $ (145)
Amortization period 24 years 2 months 12 days
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Actuarial losses $ (9) [1]
Prior service credits and other 1
Total $ (9)
Amortization period 25 years 3 months 18 days
Foreign Plan [Member] | Pension Plan [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Actuarial losses $ (81) [1]
Prior service credits and other 3
Total $ (78)
Amortization period 20 years
[1] Due to the U.S. Pfizer Consolidated Pension Plan freeze effective for January 1, 2018, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans reflect the expected life expectancy of the plan participants, whereas prior years utilized the expected future service period of plan participants. The average amortization periods to be utilized for 2019 are 24.2 years for our U.S. qualified plans, 25.3 years for our U.S. supplemental (non-qualified) plans, 20 years for our international plans, and 9.3 years for our postretirement plans.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Weighted-Average Actuarial Assumptions (Details)
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Postretirement Benefits Plan [Member]      
Weighted-average assumptions used to determine benefit obligations:      
Weighted-average assumptions used to determine benefit obligations, Discount rate 4.30% 3.70% 4.20%
Weighted-average assumptions used to determine net periodic benefit cost:      
Weighted-average assumptions used to determine net periodic benefit cost, Discount rate 3.70% 4.20% 4.50%
Weighted-average assumptions used to determine net periodic benefit cost, Expected return on plan assets 7.50% 8.00% 8.00%
United States [Member] | Pension Plan [Member]      
Weighted-average assumptions used to determine benefit obligations:      
Weighted-average assumptions used to determine benefit obligations, Discount rate 4.40% 3.80% 4.30%
Weighted-average assumptions used to determine benefit obligations, Rate of compensation increase [1] 0.00% 2.80% 2.80%
Weighted-average assumptions used to determine net periodic benefit cost:      
Weighted-average assumptions used to determine net periodic benefit cost, Discount rate 3.80% 4.30% 4.50%
Weighted-average assumptions used to determine net periodic benefit cost, Expected return on plan assets 7.50% 8.00% 8.00%
Weighted-average assumptions used to determine net periodic benefit cost, Rate of compensation increase 2.80% 2.80% 2.80%
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]      
Weighted-average assumptions used to determine benefit obligations:      
Weighted-average assumptions used to determine benefit obligations, Discount rate 4.30% 3.70% 4.20%
Weighted-average assumptions used to determine benefit obligations, Rate of compensation increase [1] 0.00% 2.80% 2.80%
Weighted-average assumptions used to determine net periodic benefit cost:      
Weighted-average assumptions used to determine net periodic benefit cost, Discount rate 3.70% 4.20% 4.50%
Weighted-average assumptions used to determine net periodic benefit cost, Rate of compensation increase 2.80% 2.80% 2.80%
Foreign Plan [Member] | Pension Plan [Member]      
Weighted-average assumptions used to determine benefit obligations:      
Weighted-average assumptions used to determine benefit obligations, Discount rate 2.50% 2.30% 2.40%
Weighted-average assumptions used to determine benefit obligations, Rate of compensation increase 1.40% 2.50% 2.60%
Weighted-average assumptions used to determine net periodic benefit cost:      
Weighted-average assumptions used to determine interest cost, Discount rate [2] 2.00% 2.10% 2.70%
Weighted-average assumptions used to determine service cost, Discount rate [2] 2.30% 2.30% 3.00%
Weighted-average assumptions used to determine net periodic benefit cost, Expected return on plan assets 4.40% 4.70% 5.20%
Weighted-average assumptions used to determine net periodic benefit cost, Rate of compensation increase 2.50% 2.60% 2.60%
[1] Effective January 1, 2018, we froze the defined benefit plans to future benefit accruals in the U.S. and members’ accrued benefits to that date no longer increase in line with future compensation increases. The rate of compensation increase is therefore no longer an assumption used to determine the benefit obligation.
[2] Effective January 1, 2016, the Company changed the approach used to measure service cost and interest costs for certain international pension plans and other postretirement benefits. In accordance with this change, the effective rate for interest on the benefit obligations and effective rate for service cost, respectively, are reported for international pension plans.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Healthcare Cost Trend Rate Assumptions (Details) - Postretirement Benefits Plan [Member]
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Defined Benefit Plan Disclosure [Line Items]    
Healthcare cost trend rate assumed for next year (up to age 65) 5.80% 6.10%
Healthcare cost trend rate assumed for next year (age 65 and older) 6.50% 7.00%
Rate to which the cost trend rate is assumed to decline 4.50% 4.50%
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - One-Percentage-Point Increase or Decrease in the Healthcare Cost Trend Rate (Details) - Postretirement Benefits Plan [Member]
$ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
Defined Benefit Plan Disclosure [Line Items]  
Effect on total service and interest cost components, increase $ 3
Effect on total service and interest cost components, decrease (2)
Effect on postretirement benefit obligation, increase 35
Effect on postretirement benefit obligation, decrease $ (27)
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Obligations and Funded Status (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Postretirement Benefits Plan [Member]      
Change in benefit obligation      
Benefit obligation, beginning [1],[2] $ 2,028 $ 2,254  
Service cost [3] 39 [1],[2] 42 [1],[2] $ 41
Interest cost 72 [1],[2] 90 [1],[2] 101
Employee contributions [1],[2] 102 94  
Plan amendments [1],[2] 2 0  
Changes in actuarial assumptions and other [1],[2] (122) (177)  
Foreign exchange impact [1],[2] (4) 5  
Acquisitions/divestitures/other, net [1],[2] 0 1  
Curtailments [1],[2] (1) 1  
Settlements [1],[2] 0 0  
Special termination benefits 2 [1],[2] 0 [1],[2] 0
Benefits paid [1],[2] (249) (280)  
Benefit obligation, ending [1],[2] 1,870 2,028 2,254
Change in plan assets      
Fair value of plan assets, beginning [2] 494 [4] 458  
Actual gain/(loss) on plan assets [2] (22) 39  
Company contributions [2] 145 183  
Employee contributions [2] 102 94  
Foreign exchange impact [2] 0 0  
Acquisitions/divestitures, net [2] 0 0  
Settlements [2] 0 0  
Benefits paid [2] (249) (280)  
Fair value of plan assets, ending [2] 469 [4] 494 [4] 458
Funded status—Plan assets less than benefit obligation [2] (1,401) (1,534)  
United States [Member] | Pension Plan [Member]      
Change in benefit obligation      
Benefit obligation, beginning [1],[5] 16,702 15,547  
Service cost [1],[5] 0 269  
Interest cost [1],[5] 598 634  
Employee contributions [1],[5] 0 0  
Plan amendments [1],[5] (22) 0  
Changes in actuarial assumptions and other [1],[5] (1,219) 1,614  
Foreign exchange impact [1],[5] 0 0  
Acquisitions/divestitures/other, net [1],[5] 0 0  
Curtailments [1],[5] 11 11  
Settlements [1],[5] (391) (842)  
Special termination benefits [1],[5] 6 0  
Benefits paid [1],[5] (546) (530)  
Benefit obligation, ending [1],[5] 15,141 16,702 15,547
Change in plan assets      
Fair value of plan assets, beginning [5] 14,284 12,556  
Actual gain/(loss) on plan assets [5] (796) 2,005  
Company contributions [5] 500 1,095  
Employee contributions [5] 0 0  
Foreign exchange impact [5] 0 0  
Acquisitions/divestitures, net [5] 0    
Settlements [5] (391) (842)  
Benefits paid [5] (546) (530)  
Fair value of plan assets, ending [5] 13,051 14,284 12,556
Funded status—Plan assets less than benefit obligation [5] (2,089) (2,418)  
Defined benefit plan, accumulated benefit obligation 15,100 16,700  
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]      
Change in benefit obligation      
Benefit obligation, beginning [1] 1,495 1,450  
Service cost [1] 0 24  
Interest cost [1] 55 54  
Employee contributions [1] 0 0  
Plan amendments [1] 0 0  
Changes in actuarial assumptions and other [1] (152) 110  
Foreign exchange impact [1] 0 0  
Acquisitions/divestitures/other, net [1] 0 0  
Curtailments [1] 1 0  
Settlements [1] (72) (98)  
Special termination benefits [1] 10 0  
Benefits paid [1] (58) (45)  
Benefit obligation, ending [1] 1,280 1,495 1,450
Change in plan assets      
Fair value of plan assets, beginning 0 0  
Company contributions 129 143  
Employee contributions 0 0  
Foreign exchange impact 0 0  
Settlements (72) (98)  
Benefits paid (58) (45)  
Fair value of plan assets, ending 0 0 0
Funded status—Plan assets less than benefit obligation (1,280) (1,495)  
Defined benefit plan, accumulated benefit obligation 1,300 1,500  
Foreign Plan [Member] | Pension Plan [Member]      
Change in benefit obligation      
Benefit obligation, beginning [1],[6] 10,607 9,691  
Service cost [3] 136 [1],[6] 171 [1],[6] 165
Interest cost 212 [1],[6] 204 [1],[6] 233
Employee contributions [1],[6] 7 6  
Plan amendments [1],[6] 29 2  
Changes in actuarial assumptions and other [1],[6] (169) 135  
Foreign exchange impact [1],[6] (457) 760  
Acquisitions/divestitures/other, net [1],[6] (2) 26  
Curtailments [1],[6] (3) 0  
Settlements [1],[6] (34) (31)  
Special termination benefits 0 [1],[6] 1 [1],[6] 1
Benefits paid [1],[6] (373) (357)  
Benefit obligation, ending [1],[6] 9,952 10,607 9,691
Change in plan assets      
Fair value of plan assets, beginning [6] 8,863 7,683  
Actual gain/(loss) on plan assets [6] (77) 811  
Company contributions [6] 209 160  
Employee contributions [6] 7 6  
Foreign exchange impact [6] (380) 561  
Acquisitions/divestitures, net [6] 0 30  
Settlements [6] (34) (31)  
Benefits paid [6] (373) (357)  
Fair value of plan assets, ending [6] 8,215 8,863 $ 7,683
Funded status—Plan assets less than benefit obligation [6] (1,738) (1,745)  
Defined benefit plan, accumulated benefit obligation $ 9,500 $ 10,100  
[1] For the U.S. and international pension plans, the benefit obligation is the PBO. For the postretirement plans, the benefit obligation is the ABO. The ABO for all of our U.S. qualified pension plans was $15.1 billion in 2018 and $16.7 billion in 2017. The ABO for our U.S. supplemental (non-qualified) pension plans was $1.3 billion in 2018 and $1.5 billion in 2017. The ABO for our international pension plans was $9.5 billion in 2018 and $10.1 billion in 2017.
[2] The favorable change in the funded status of our postretirement plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[3] Effective January 1, 2018, we froze two significant defined benefit pension plans to future benefit accruals in the U.S. and U.K. and as a result, service costs for those plans are eliminated. In addition, due to the plan freeze, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans was extended to the expected life expectancy of the plan participants, whereas the average amortization period in prior years utilized the expected future service period of plan participants.
[4] Reflects postretirement plan assets, which support a portion of our U.S. retiree medical plans.
[5] The favorable change in the funded status of our U.S. qualified plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[6] The favorable change in the international plans’ funded status was primarily due to favorable currency movements, partially offset by a decrease in the actual return on plan assets.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Funded Status Recognized in Consolidated Balance Sheets (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Postretirement Benefits Plan [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Noncurrent assets [1] $ 0 $ 0
Current liabilities [2] (29) (31)
Noncurrent liabilities [3] (1,371) (1,504)
Funded status (1,401) (1,534)
United States [Member] | Pension Plan [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Noncurrent assets [1] 0 0
Current liabilities [2] (1) 0
Noncurrent liabilities [3] (2,088) (2,418)
Funded status (2,089) (2,418)
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Noncurrent assets [1] 0 0
Current liabilities [2] (167) (160)
Noncurrent liabilities [3] (1,113) (1,336)
Funded status (1,280) (1,495)
Foreign Plan [Member] | Pension Plan [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Noncurrent assets [1] 401 454
Current liabilities [2] (28) (26)
Noncurrent liabilities [3] (2,111) (2,172)
Funded status $ (1,738) $ (1,745)
[1] Included primarily in Other noncurrent assets.
[2] Included in Accrued compensation and related items.
[3] Included in Pension benefit obligations, net and Postretirement benefit obligations, net, as appropriate.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Amounts Recognized in Accumulated Other Comprehensive (Loss)/Income (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Postretirement Benefits Plan [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Actuarial losses [1] $ (202) $ (293)
Prior service (costs)/credits 994 1,190
Total 792 897
United States [Member] | Pension Plan [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Actuarial losses [1] (5,061) (4,677)
Prior service (costs)/credits 1 (23)
Total (5,060) (4,699)
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Actuarial losses [1] (370) (561)
Prior service (costs)/credits 1 1
Total (370) (559)
Foreign Plan [Member] | Pension Plan [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Actuarial losses [1] (2,372) (2,322)
Prior service (costs)/credits 0 34
Total $ (2,372) $ (2,288)
[1] The accumulated actuarial losses primarily represent the impact of changes in discount rates and other assumptions that result in cumulative changes in our PBO, as well as the cumulative difference between the expected return and actual return on plan assets. These accumulated actuarial losses are recognized in Accumulated other comprehensive loss and are amortized into net periodic benefit costs primarily over the average remaining service period for active participants for plans that are not frozen or the expected life expectancy of plan participants for frozen plans, using the corridor approach.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Pension Plans in Excess of Plan Assets (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
United States [Member] | Pension Plan [Member]    
Pension plans with an ABO in excess of plan assets:    
Fair value of plan assets $ 13,051 $ 14,284
ABO 15,141 16,702
Pension plans with a PBO in excess of plan assets:    
Fair value of plan assets 13,051 14,284
PBO 15,141 16,702
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]    
Pension plans with an ABO in excess of plan assets:    
ABO 1,280 1,495
Pension plans with a PBO in excess of plan assets:    
PBO 1,280 1,495
Foreign Plan [Member] | Pension Plan [Member]    
Pension plans with an ABO in excess of plan assets:    
Fair value of plan assets 4,514 882
ABO 6,286 2,724
Pension plans with a PBO in excess of plan assets:    
Fair value of plan assets 5,432 1,626
PBO $ 7,571 $ 3,825
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Plan Assets (Details) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [2] $ 469 [1] $ 494 [1] $ 458
Assets Measured at NAV [1],[3]   0  
Postretirement Benefits Plan [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 469 494  
Postretirement Benefits Plan [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Cash and Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 0 0  
Postretirement Benefits Plan [Member] | Cash and Cash Equivalents [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Cash and Cash Equivalents [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4]   0  
Postretirement Benefits Plan [Member] | Equity Securities [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 0 0  
Postretirement Benefits Plan [Member] | Equity Securities [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 0 0  
Assets Measured at NAV [1],[3]   0  
Postretirement Benefits Plan [Member] | Equity Securities [Member] | Level 1 [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Equity Securities [Member] | Level 1 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4]   0  
Postretirement Benefits Plan [Member] | Equity Securities [Member] | Level 2 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Equity Securities [Member] | Level 3 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Corporate debt [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 0 0  
Postretirement Benefits Plan [Member] | Corporate debt [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4]   0  
Postretirement Benefits Plan [Member] | Corporate debt [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Corporate debt [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4]   0  
Postretirement Benefits Plan [Member] | Government and Agency Obligations [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 0 0  
Postretirement Benefits Plan [Member] | Government and Agency Obligations [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Government and Agency Obligations [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Government and Agency Obligations [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0    
Postretirement Benefits Plan [Member] | Fixed Income Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 0 0  
Assets Measured at NAV [1],[3]   0  
Postretirement Benefits Plan [Member] | Fixed Income Commingled Funds [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4]   0  
Postretirement Benefits Plan [Member] | Fixed Income Commingled Funds [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Fixed Income Commingled Funds [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 0  
Postretirement Benefits Plan [Member] | Partnership Interest [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[5] 0 0  
Assets Measured at NAV [1],[3],[5]   0  
Postretirement Benefits Plan [Member] | Partnership Interest [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4],[5] 0 0  
Postretirement Benefits Plan [Member] | Partnership Interest [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4],[5] 0 0  
Postretirement Benefits Plan [Member] | Insurance Contracts [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 469 494  
Postretirement Benefits Plan [Member] | Insurance Contracts [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0    
Postretirement Benefits Plan [Member] | Insurance Contracts [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 469 494  
Postretirement Benefits Plan [Member] | Insurance Contracts [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4]   0  
Postretirement Benefits Plan [Member] | Other Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1] 0 [6] 0 [7]  
Assets Measured at NAV [1],[3],[7]   0  
Postretirement Benefits Plan [Member] | Other Commingled Funds [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 [6] 0 [7]  
Postretirement Benefits Plan [Member] | Other Commingled Funds [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 [6] 0 [7]  
Postretirement Benefits Plan [Member] | Other Commingled Funds [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [1],[4] 0 [6] 0 [7]  
United States [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [8] 13,051 14,284 12,556
Assets Measured at NAV [3] 2,581 2,889  
United States [Member] | Pension Plan [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 3,173 4,238  
United States [Member] | Pension Plan [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 7,294 7,153  
United States [Member] | Pension Plan [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 3 4  
United States [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 443 655  
United States [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 53 115  
United States [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 390 540  
United States [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 177 253  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 3,156 4,157  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 933 1,194  
Assets Measured at NAV [3] 299 392  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 1 [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 3,119 4,118  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 1 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 2 [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 37 38  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 2 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 634 802  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 3 [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 1  
United States [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 3 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Corporate debt [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 4,654 4,250  
United States [Member] | Pension Plan [Member] | Corporate debt [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 1 5  
United States [Member] | Pension Plan [Member] | Corporate debt [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 4,650 4,242  
United States [Member] | Pension Plan [Member] | Corporate debt [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 3 3  
United States [Member] | Pension Plan [Member] | Government and Agency Obligations [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 1,391 1,316  
United States [Member] | Pension Plan [Member] | Government and Agency Obligations [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Government and Agency Obligations [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 1,391 1,316  
United States [Member] | Pension Plan [Member] | Government and Agency Obligations [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 96 94  
Assets Measured at NAV [3] 96 94  
United States [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4]   0  
United States [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Partnership Interest [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [5] 1,165 1,197  
Assets Measured at NAV [3],[5] 1,165 1,197  
United States [Member] | Pension Plan [Member] | Partnership Interest [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[5] 0 0  
United States [Member] | Pension Plan [Member] | Partnership Interest [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[5]   0  
United States [Member] | Pension Plan [Member] | Partnership Interest [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[5] 0 0  
United States [Member] | Pension Plan [Member] | Insurance Contracts [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 192 215  
United States [Member] | Pension Plan [Member] | Insurance Contracts [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Insurance Contracts [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 192 215  
United States [Member] | Pension Plan [Member] | Insurance Contracts [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
United States [Member] | Pension Plan [Member] | Other Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [7] 1,021 1,206  
Assets Measured at NAV [3],[7] 1,021 1,206  
United States [Member] | Pension Plan [Member] | Other Commingled Funds [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[7] 0 0  
United States [Member] | Pension Plan [Member] | Other Commingled Funds [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[7] 0 0  
Foreign Plan [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [9] 8,215 8,863 7,683
Assets Measured at NAV [3] 2,300 2,709  
Foreign Plan [Member] | Pension Plan [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 40 194  
Foreign Plan [Member] | Pension Plan [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 4,809 5,073  
Foreign Plan [Member] | Pension Plan [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 1,065 887  
Foreign Plan [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 246 385  
Foreign Plan [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 39 48  
Foreign Plan [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 208 337  
Foreign Plan [Member] | Pension Plan [Member] | Cash and Cash Equivalents [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 2 154  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 1,876 2,897  
Assets Measured at NAV [3] 463 1,303  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 1 [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 2 146  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 1 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 2 [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 8  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 2 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 1,413 1,594  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 3 [Member] | Global Equity Securities [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Equity Securities [Member] | Level 3 [Member] | Equity Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Corporate debt [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 727 588  
Assets Measured at NAV [3] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Corporate debt [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Corporate debt [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 727 588  
Foreign Plan [Member] | Pension Plan [Member] | Corporate debt [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Government and Agency Obligations [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [10] 1,305 716  
Assets Measured at NAV [3],[10] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Government and Agency Obligations [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[10] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Government and Agency Obligations [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[10] 1,305 716  
Foreign Plan [Member] | Pension Plan [Member] | Government and Agency Obligations [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[10] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 1,770 2,181  
Assets Measured at NAV [3] 762 841  
Foreign Plan [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 1,007 1,340  
Foreign Plan [Member] | Pension Plan [Member] | Fixed Income Commingled Funds [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Partnership Interest [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [5] 57 42  
Assets Measured at NAV [3],[5] 53 35  
Foreign Plan [Member] | Pension Plan [Member] | Partnership Interest [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[5] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Partnership Interest [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[5] 4 7  
Foreign Plan [Member] | Pension Plan [Member] | Partnership Interest [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[5] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Insurance Contracts [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [11] 759 496  
Assets Measured at NAV [3],[11] 1 1  
Foreign Plan [Member] | Pension Plan [Member] | Insurance Contracts [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[11] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Insurance Contracts [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[11] 74 75  
Foreign Plan [Member] | Pension Plan [Member] | Insurance Contracts [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets 684 [4],[11] 420 [4],[11] 254
Foreign Plan [Member] | Pension Plan [Member] | Other [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [7],[11] 1,473 1,404  
Assets Measured at NAV [3],[7],[11] 1,020 528  
Foreign Plan [Member] | Pension Plan [Member] | Other [Member] | Level 1 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[7],[11] 0 0  
Foreign Plan [Member] | Pension Plan [Member] | Other [Member] | Level 2 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets [4],[7],[11] 71 408  
Foreign Plan [Member] | Pension Plan [Member] | Other [Member] | Level 3 [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair value of plan assets $ 382 [4],[7],[11] $ 468 [4],[7],[11] $ 324
[1] Reflects postretirement plan assets, which support a portion of our U.S. retiree medical plans.
[2] The favorable change in the funded status of our postretirement plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[3] Certain investments that are measured at NAV per share (or its equivalent) have not been classified in the fair value hierarchy. The NAV amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented for the total pension benefits plan assets.
[4] Fair values are determined based on valuation inputs categorized as Level 1, 2 or 3 (see Note 1E).
[5] Primarily includes investments in private equity, private debt, public equity limited partnerships, and, to a lesser extent, real estate and venture capital.
[6] Represents net reimbursements to our partners for selling, informational and administrative expenses incurred.
[7] Primarily includes, for U.S. plan assets, investments in hedge funds and, to a lesser extent, real estate and, for international plan assets, investments in real estate and hedge funds.
[8] The favorable change in the funded status of our U.S. qualified plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[9] The favorable change in the international plans’ funded status was primarily due to favorable currency movements, partially offset by a decrease in the actual return on plan assets.
[10] Government and agency obligations are inclusive of repurchase agreements.
[11] See below for a tabular analysis of the changes in Level 3 investments valued using significant unobservable inputs.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Analysis of Changes in Significant Investments Valued Using Significant Unobservable Inputs (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Level 3 [Member] | Other Funds [Member]    
Defined Benefit Plan, Plan Assets Level 3 Reconciliation, Increase (Decrease) for Purchase, Sale, and Settlement [Abstract]    
Transfer into/(out of) Level 3 $ (51) $ 0
Foreign Plan [Member] | Pension Plan [Member]    
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]    
Fair value of plan assets, beginning [1] 8,863 7,683
Defined Benefit Plan, Plan Assets Level 3 Reconciliation, Increase (Decrease) for Purchase, Sale, and Settlement [Abstract]    
Exchange rate changes [1] (380) 561
Fair value of plan assets, ending [1] 8,215 8,863
Foreign Plan [Member] | Pension Plan [Member] | Insurance Contracts [Member]    
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]    
Fair value of plan assets, beginning [2] 496  
Defined Benefit Plan, Plan Assets Level 3 Reconciliation, Increase (Decrease) for Purchase, Sale, and Settlement [Abstract]    
Fair value of plan assets, ending [2] 759 496
Foreign Plan [Member] | Pension Plan [Member] | Other Funds [Member]    
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]    
Fair value of plan assets, beginning [2],[3] 1,404  
Defined Benefit Plan, Plan Assets Level 3 Reconciliation, Increase (Decrease) for Purchase, Sale, and Settlement [Abstract]    
Fair value of plan assets, ending [2],[3] 1,473 1,404
Foreign Plan [Member] | Pension Plan [Member] | Level 3 [Member]    
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]    
Fair value of plan assets, beginning [4] 887  
Defined Benefit Plan, Plan Assets Level 3 Reconciliation, Increase (Decrease) for Purchase, Sale, and Settlement [Abstract]    
Fair value of plan assets, ending [4] 1,065 887
Foreign Plan [Member] | Pension Plan [Member] | Level 3 [Member] | Insurance Contracts [Member]    
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]    
Fair value of plan assets, beginning 420 [2],[4] 254
Defined Benefit Plan, Plan Assets Level 3 Reconciliation, Increase (Decrease) for Purchase, Sale, and Settlement [Abstract]    
Assets held, ending 1 1
Assets sold during the period   0
Purchases, sales, and settlements, net 188 138
Transfer into/(out of) Level 3 107 0
Exchange rate changes (31) 27
Fair value of plan assets, ending [2],[4] 684 420
Foreign Plan [Member] | Pension Plan [Member] | Level 3 [Member] | Other Funds [Member]    
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]    
Fair value of plan assets, beginning 468 [2],[3],[4] 324
Defined Benefit Plan, Plan Assets Level 3 Reconciliation, Increase (Decrease) for Purchase, Sale, and Settlement [Abstract]    
Assets held, ending 15 18
Assets sold during the period 0 1
Purchases, sales, and settlements, net (31) 94
Exchange rate changes (20) 30
Fair value of plan assets, ending [2],[3],[4] $ 382 $ 468
[1] The favorable change in the international plans’ funded status was primarily due to favorable currency movements, partially offset by a decrease in the actual return on plan assets.
[2] See below for a tabular analysis of the changes in Level 3 investments valued using significant unobservable inputs.
[3] Primarily includes, for U.S. plan assets, investments in hedge funds and, to a lesser extent, real estate and, for international plan assets, investments in real estate and hedge funds.
[4] Fair values are determined based on valuation inputs categorized as Level 1, 2 or 3 (see Note 1E).
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Long-term Target Asset Allocations Ranges and the Percentage of the Fair Value of Plan Assets (Detail) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 100.00%    
Equity and debt securities, percentage of plan assets 100.00% 100.00%  
Plan assets [2] $ 469 [1] $ 494 [1] $ 458
Cash and Cash Equivalents [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 0.00% 0.00%  
Plan assets [1] $ 0 $ 0  
Equity Securities [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 0.00%    
Equity and debt securities, percentage of plan assets 0.00% 0.00%  
Fixed Income Securities [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 0.00%    
Equity and debt securities, percentage of plan assets 0.00% 0.00%  
Plan assets [1] $ 0 $ 0  
Other Investments [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 100.00% 100.00%  
Insurance Contracts [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Plan assets [1] $ 469 $ 494  
United States [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 100.00%    
Equity and debt securities, percentage of plan assets 100.00% 100.00%  
Plan assets [3] $ 13,051 $ 14,284 12,556
United States [Member] | Cash and Cash Equivalents [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 3.40% 4.60%  
Plan assets $ 443 $ 655  
United States [Member] | Equity Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 31.30% 37.50%  
Plan assets $ 177 $ 253  
United States [Member] | Fixed Income Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 47.10% 39.60%  
Plan assets $ 96 $ 94  
United States [Member] | Other Investments [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets [4] 18.20% 18.30%  
United States [Member] | Insurance Contracts [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Plan assets $ 192 $ 215  
Foreign Plan [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 100.00%    
Equity and debt securities, percentage of plan assets 100.00% 100.00%  
Plan assets [5] $ 8,215 $ 8,863 $ 7,683
Foreign Plan [Member] | Cash and Cash Equivalents [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 3.00% 4.30%  
Plan assets $ 246 $ 385  
Foreign Plan [Member] | Equity Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 22.90% 34.40%  
Foreign Plan [Member] | Fixed Income Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 46.30% 39.30%  
Plan assets $ 1,770 $ 2,181  
Foreign Plan [Member] | Other Investments [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, percentage of plan assets 27.90% 21.90%  
Foreign Plan [Member] | Insurance Contracts [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Plan assets [6] $ 759 $ 496  
Minimum [Member] | Cash and Cash Equivalents [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 0.00%    
Minimum [Member] | Other Investments [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 95.00%    
Minimum [Member] | United States [Member] | Cash and Cash Equivalents [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 0.00%    
Minimum [Member] | United States [Member] | Equity Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 35.00%    
Minimum [Member] | United States [Member] | Fixed Income Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 28.00%    
Minimum [Member] | United States [Member] | Other Investments [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage [4] 5.00%    
Minimum [Member] | Foreign Plan [Member] | Cash and Cash Equivalents [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 0.00%    
Minimum [Member] | Foreign Plan [Member] | Equity Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 20.00%    
Minimum [Member] | Foreign Plan [Member] | Fixed Income Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 35.00%    
Minimum [Member] | Foreign Plan [Member] | Other Investments [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 10.00%    
Maximum [Member] | Cash and Cash Equivalents [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 5.00%    
Maximum [Member] | Other Investments [Member] | Postretirement Benefits Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 100.00%    
Maximum [Member] | United States [Member] | Cash and Cash Equivalents [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 10.00%    
Maximum [Member] | United States [Member] | Equity Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 55.00%    
Maximum [Member] | United States [Member] | Fixed Income Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 53.00%    
Maximum [Member] | United States [Member] | Other Investments [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage [4] 20.00%    
Maximum [Member] | Foreign Plan [Member] | Cash and Cash Equivalents [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 10.00%    
Maximum [Member] | Foreign Plan [Member] | Equity Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 40.00%    
Maximum [Member] | Foreign Plan [Member] | Fixed Income Securities [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 60.00%    
Maximum [Member] | Foreign Plan [Member] | Other Investments [Member] | Pension Plan [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Equity and debt securities, target allocation percentage 35.00%    
[1] Reflects postretirement plan assets, which support a portion of our U.S. retiree medical plans.
[2] The favorable change in the funded status of our postretirement plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[3] The favorable change in the funded status of our U.S. qualified plans was primarily due to an increase in the discount rate at the end of 2018, partially offset by a decrease in actual return on plan assets.
[4] Actual percentage of plan assets in Other investments for 2018 includes $192 million, as compared to $215 million in 2017, related to a group fixed annuity insurance contract that was executed by legacy Wyeth for certain members of its defined benefit plans prior to Pfizer acquiring the company in 2009, and $177 million in 2018, as compared to $253 million in 2017, related to an investment in a partnership whose primary holdings are public equity securities.
[5] The favorable change in the international plans’ funded status was primarily due to favorable currency movements, partially offset by a decrease in the actual return on plan assets.
[6] See below for a tabular analysis of the changes in Level 3 investments valued using significant unobservable inputs.
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Expected Future Cash Flow Information (Details)
$ in Millions
Dec. 31, 2018
USD ($)
Postretirement Benefits Plan [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Expected contributions in 2019 $ 160
Expected benefit payments:  
2019 166
2020 171
2021 171
2022 168
2023 165
2024-2028 777
United States [Member] | Pension Plan [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Expected contributions in 2019 11
Expected benefit payments:  
2019 1,387
2020 1,089
2021 1,058
2022 1,020
2023 1,018
2024-2028 4,837
United States [Member] | U.S. Supplemental (Non-Qualified) Pension Plans [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Expected contributions in 2019 167
Expected benefit payments:  
2019 167
2020 121
2021 114
2022 113
2023 103
2024-2028 445
Foreign Plan [Member] | Pension Plan [Member]  
Defined Benefit Plan Disclosure [Line Items]  
Expected contributions in 2019 177
Expected benefit payments:  
2019 354
2020 372
2021 380
2022 385
2023 387
2024-2028 $ 2,068
v3.10.0.1
Pension and Postretirement Benefit Plans and Defined Contribution Plans - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Retirement Benefits [Abstract]      
Defined contribution plan, cost recognized $ 622 $ 380 $ 317
v3.10.0.1
Equity - Narrative (Details)
 2 Months Ended 3 Months Ended 12 Months Ended
Feb. 12, 2019
USD ($)
shares
Feb. 07, 2019
USD ($)
Sep. 07, 2018
$ / shares
shares
Mar. 14, 2018
USD ($)
$ / shares
shares
Mar. 12, 2018
USD ($)
May 19, 2017
shares
Feb. 06, 2017
USD ($)
$ / shares
shares
Feb. 02, 2017
USD ($)
Jun. 20, 2016
$ / shares
shares
Mar. 10, 2016
USD ($)
$ / shares
shares
Mar. 08, 2016
USD ($)
Mar. 11, 2018
USD ($)
 [1]
May 19, 2017
$ / shares
Dec. 31, 2018
USD ($)
employee_stock_ownership_plan
$ / shares
shares
Dec. 31, 2017
USD ($)
shares
Dec. 31, 2016
USD ($)
shares
Feb. 28, 2019
USD ($)
Dec. 31, 2015
USD ($)
Oct. 23, 2014
USD ($)
Equity, Class of Treasury Stock [Line Items]                                      
Amount of shares authorized in stock purchase plan, value                     $ 5,000,000,000               $ 11,000,000,000
Amount of remaining shares authorized in stock purchase plan, value                           $ 14,200,000,000          
Accelerated share repurchases, cash paid                   $ (5,000,000,000)                  
Shares repurchased | shares                 18,000,000 136,000,000       307,000,000 [1] 150,000,000 [2] 154,000,000 [3]      
Shares repurchased, initial price per share (in dollars per share) | $ / shares                   $ 29.36                  
Accelerated share repurchase, percentage of agreement                     80.00%                
Accelerated share repurchase, final average price paid (in dollars per share) | $ / shares                 $ 32.38                    
Cost of purchase                       $ 8,200,000,000   $ 12,198,000,000 [1],[4] $ 5,000,000,000 [2],[4] $ 5,000,000,000 [3],[4]      
Number of employee stock ownership plans | employee_stock_ownership_plan                           2          
Common ESOP Plan [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
ESOP compensation expense                           $ 19,000,000 11,000,000 $ 9,000,000      
Preferred Stock [Member] | Series A, Convertible Preferred Stock [Member] | Preferred Employee Stock Ownership Plan [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Series A convertible perpetual preferred stock, dividends rate                           6.25%          
Series A convertible perpetual preferred stock, per share stated value (in dollars per share) | $ / shares                           $ 40,300          
Preferred stock, redemption price per share (in dollars per share) | $ / shares                           $ 40,300          
Common Stock [Member] | Preferred Employee Stock Ownership Plan [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Series A convertible perpetual preferred stock, common stock shares when converted (in shares) | shares                           2,574.87          
Convertible preferred stock, number of shares convertible | shares                           1,000,000          
Common Stock [Member] | Common ESOP Plan [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Number of shares in ESOP | shares                           49,000,000          
December 2015 Stock Purchase Plan [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Amount of shares authorized in stock purchase plan, value                                   $ 11,000,000,000  
December 2017 Stock Purchase Plan [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Amount of shares authorized in stock purchase plan, value                             $ 10,000,000,000        
Amount of remaining shares authorized in stock purchase plan, value                           $ 4,200,000,000          
December 2018 Stock Purchase Plan [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Amount of shares authorized in stock purchase plan, value                           $ 10,000,000,000          
Share Repurchase Agreement with Citibank [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Amount of shares authorized in stock purchase plan, value         $ 4,000,000,000     $ 5,000,000,000                      
Accelerated share repurchases, cash paid       $ (4,000,000,000)     $ (5,000,000,000)                        
Shares repurchased | shares     21,000,000 87,000,000   24,000,000 126,000,000                        
Shares repurchased, initial price per share (in dollars per share) | $ / shares       $ 36.61     $ 31.73                        
Accelerated share repurchase, percentage of agreement         80.00%     80.00%                      
Accelerated share repurchase, final average price paid (in dollars per share) | $ / shares     $ 36.86                                
Accelerated share repurchase, average price paid per share (in dollars per share) | $ / shares                         $ 33.31            
Subsequent Event [Member]                                      
Equity, Class of Treasury Stock [Line Items]                                      
Amount of shares authorized in stock purchase plan, value   $ 6,800,000,000                                  
Amount of remaining shares authorized in stock purchase plan, value                                 $ 5,300,000,000    
Accelerated share repurchases, cash paid $ 6,800,000,000                                    
Shares repurchased | shares 130,000,000                                    
Accelerated share repurchase, percentage of agreement   80.00%                                  
[1] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on March 12, 2018, as well as other share repurchases. See above for additional information.
[2] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on February 2, 2017. See above for additional information.
[3] Represents shares purchased pursuant to the accelerated share repurchase agreement entered into on March 8, 2016. See above for additional information.
[4] Amounts may not add due to rounding.
v3.10.0.1
Equity - Summary of Common Stock Purchases (Details) - USD ($)
shares in Millions, $ in Millions
 2 Months Ended 12 Months Ended
Jun. 20, 2016
Mar. 10, 2016
Mar. 11, 2018
 [1]
Dec. 31, 2018
 [1]
Dec. 31, 2017
 [2]
Dec. 31, 2016
 [3]
Equity [Abstract]            
Shares of common stock purchased 18 136   307 150 154
Cost of purchase     $ 8,200 $ 12,198 [4] $ 5,000 [4] $ 5,000 [4]
[1] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on March 12, 2018, as well as other share repurchases. See above for additional information.
[2] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on February 2, 2017. See above for additional information.
[3] Represents shares purchased pursuant to the accelerated share repurchase agreement entered into on March 8, 2016. See above for additional information.
[4] Amounts may not add due to rounding.
v3.10.0.1
Share-Based Payments - Narrative (Detail)
 12 Months Ended
Dec. 31, 2018
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Shares available for award 195,000,000
2014 Stock Plan [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of additional shares authorized 520,000,000
Maximum shares available per individual during the plan period 20,000,000
2004 Stock Plan, Amended and Restated [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Maximum shares available per individual during the plan period 8,000,000
Restricted Stock Units (RSUs) [Member] | 2014 Stock Plan [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares counted toward maximum 3
Portfolio Performance Shares [Member] | 2014 Stock Plan [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares counted toward maximum 3
Performance Shares [Member] | 2014 Stock Plan [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares counted toward maximum 3
Total Shareholder Return Units (TSRUs) [Member] | 2004 Stock Plan, Amended and Restated [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares counted toward maximum 1
Performance Total Shareholder Return Unit (PTSRUs) [Member] | 2004 Stock Plan, Amended and Restated [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares counted toward maximum 1
Employee Stock Option [Member] | 2004 Stock Plan, Amended and Restated [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares counted toward maximum 1
v3.10.0.1
Share-Based Payments - Impact on Net Income (Detail) - 2004 Stock Plan, Amended and Restated [Member] - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense $ 949.0 $ 840.0 $ 691.0
Tax benefit for share-based compensation expense [1] (180.0) (163.0) (205.0)
Share-based payment expense, net of tax 769.0 677.0 486.0
Total Shareholder Return Units (TSRUs) [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense [2] 302.0 221.0 134.0
Restricted Stock Units (RSUs) [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense 286.0 301.0 299.0
Portfolio Performance Shares [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense 276.0 209.0 135.0
Performance Shares [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense 62.0 47.0 13.0
Employee Stock Option [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense 12.0 55.0 106.0
Directors' compensation [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense 10.0 $ 7.0 $ 4.0
Performance Total Shareholder Return Unit (PTSRUs) [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based payment expense $ 7.0    
[1] 2018 and 2017 include the impact of the TCJA on income taxes.
[2] Includes $7.0 million of expense for PTSRUs.
v3.10.0.1
Share-Based Payments - Total Shareholder Return Units Narrative (Details) - Total Shareholder Return Units (TSRUs) [Member]
 12 Months Ended
Oct. 26, 2016
USD ($)
Employee
trading_day
Dec. 31, 2018
Employee
trading_day
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Trading day average used to calculate the conversion | trading_day 20 20
Age of eligible unit holder which can elect to exercise and convert TSRUs when vested into PTUs 55 years  
Award requisite service period 10 years  
Number of employees affected by plan modification | Employee 2,900 260
Incremental compensation cost resulting from plan modification | $ $ 0  
Minimum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Contractual term (years)   5 years
Maximum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Contractual term (years)   7 years
v3.10.0.1
Share-Based Payments - Valuation Assumptions of Total Shareholder Return Units (Detail) - Total Shareholder Return Units (TSRUs) [Member]
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Expected dividend yield [1] 3.73% 3.69% 3.85%
Risk-free interest rate [2] 2.60% 1.98% 1.31%
Expected stock price volatility [3] 20.00% 18.39% 21.64%
Contractual term (years) 5 years 1 month 13 days 5 years 1 month 10 days 5 years 1 month 13 days
[1] Determined using a constant dividend yield during the expected term of the TSRU.
[2] Determined using the interpolated yield on U.S. Treasury zero-coupon issues.
[3] Determined using implied volatility, after consideration of historical volatility.
v3.10.0.1
Share-Based Payments - Total Shareholder Return Units Activity (Details) - Total Shareholder Return Units (TSRUs) [Member]
shares in Thousands
 12 Months Ended
Oct. 26, 2016
Employee
Dec. 31, 2018
Employee
$ / shares
shares
Dec. 31, 2017
$ / shares
shares
Dec. 31, 2016
$ / shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]        
Nonvested, beginning of period, shares | shares   103,906    
Granted, shares | shares   47,755    
Vested, shares | shares [1]   (7,203)    
Forfeited, shares | shares   (5,512)    
Nonvested, end of period, shares | shares   138,945 103,906  
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]        
Nonvested, beginning of period, weighted-average grant date fair value per share (in dollars per share)   $ 6.07    
Granted, weighted-average grant-date fair value per share (in dollars per share)   7.42 $ 6.23 $ 5.83
Vested, weighted-average grant date fair value per share (in dollars per share) [1]   6.67    
Forfeited, weighted-average grant date fair value per share (in dollars per share)   6.55    
Nonvested, end of period, weighted-average grant date fair value per share (in dollars per share)   6.48 6.07  
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Outstanding, Weighted Average Grant Price [Abstract]        
Outstanding, beginning of period, weighted-average exercise price per share (in dollars per share)   32.47    
Granted, weighted-average exercise price per share (in dollars per share)   35.75    
Forfeited, weighted-average exercise price per share (in dollars per share) [1]   34.49    
Expired, weighted-average exercise price per share (in dollars per share)   33.88    
Outstanding, end of period, weighted-average exercise price per share (in dollars per share)   $ 33.44 $ 32.47  
Number of shares modified to accelerate vesting | shares   1,700    
Number of employees affected by plan modification | Employee 2,900 260    
[1] Includes the modification of approximately 1.7 million TSRUs to approximately 260 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
v3.10.0.1
Share-Based Payments - Outstanding Total Shareholder Return Units Activity (Details)
$ / shares in Units, $ in Millions
 12 Months Ended
Oct. 26, 2016
Employee
Dec. 31, 2018
USD ($)
Employee
$ / shares
shares
Total Shareholder Return Units (TSRUs) [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Outstanding, Share Units [1],[2]   156,534,000
Outstanding, Weighted-Average Grant Price Per Share Unit (in dollars per share) | $ / shares [1],[2]   $ 33.09
Outstanding, Weighted-Average Remaining Contractual Term (Years) [1],[2]   3 years 1 month
Outstanding, Aggregate Intrinsic Value | $ [1],[2]   $ 2,073
Vested, Share Units [1],[2],[3]   17,588,000
Vested, Weighted-Average Grant Price Per Share Unit (in dollars per share) | $ / shares [1],[2],[3]   $ 30.30
Vested, Weighted-Average Remaining Contractual Term (Years) [1],[2],[3]   1 year 6 months 12 days
Vested, Aggregate Intrinsic Value | $ [1],[2],[3]   $ 332
Expected to vest, Share Units [1],[2],[4]   133,878,000
Expected to vest, Weighted-Average Grant Price Per Share Unit (in dollars per share) | $ / shares [1],[2],[4]   $ 33.38
Expected to vest, Weighted-Average Remaining Contractual Term (Years) [1],[2],[4]   3 years 2 months
Expected to vest, Aggregate Intrinsic Value | $ [1],[2],[4]   $ 1,688
Settled, Share Units   7,643,846
Settled, Weighted-Average Grant Price Per Share Per Unit (in dollars per share) | $ / shares   $ 23.13
Exercised during period, Share Units   2,809,652
Exercised during period, Weighted-Average Grant Price (in dollars per share) | $ / shares   $ 27.86
Number of shares modified to accelerate vesting   1,700,000
Number of employees affected by plan modification | Employee 2,900 260
Profit Units [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Outstanding, Share Units [1],[2]   1,385,000
Outstanding, Weighted-Average Remaining Contractual Term (Years) [1],[2]   6 months 12 days
Outstanding, Aggregate Intrinsic Value | $ [1],[2]   $ 60
Converted awards   1,408,622
[1] In 2018, 2,809,652 TSRUs with a weighted-average grant price of $27.86 per unit were converted into 1,408,622 PTUs.
[2] In 2018, we settled 7,643,846 TSRUs with a weighted-average grant price of $23.13 per unit.
[3] Includes the modification of approximately 1.7 million TSRUs to approximately 260 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
[4] The number of TSRUs expected to vest takes into account an estimate of expected forfeitures.
v3.10.0.1
Share-Based Payments - Data Related to All Total Shareholder Return Units (Details) - Total Shareholder Return Units (TSRUs) [Member] - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Weighted-average grant-date fair value per stock option (in dollars per share) $ 7.42 $ 6.23 $ 5.83
Total compensation cost related to nonvested awards not yet recognized, pre-tax $ 246 $ 232 $ 164
Weighted-average period over which nonvested award cost is expected to be recognized (years) 1 year 7 months 1 year 8 months 12 days 1 year 10 months 24 days
v3.10.0.1
Share-Based Payments - Performance Total Shareholder Return Units Narrative (Details) - Performance Total Shareholder Return Unit (PTSRUs) [Member]
Dec. 29, 2017
$ / shares
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Grant price (in dollars per share) | $ / shares $ 36.22
Grant-date fair value (in dollars per share) | $ / shares $ 5.83
Board of Directors Chairman [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Deferred compensation arrangement, shares issued | shares 1,372,213
Head Of Innovative Health [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Deferred compensation arrangement, shares issued | shares 343,053
v3.10.0.1
Share-Based Payments - Restricted Stock Unit Activity (Detail) - Restricted Stock Units [Member]
shares in Thousands
 12 Months Ended
Dec. 31, 2018
Employee
$ / shares
shares
Dec. 31, 2017
Employee
$ / shares
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Award vesting period 3 years  
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]    
Nonvested, beginning of period, shares 22,241  
Granted, shares 9,083  
Vested, shares [1] (3,701)  
Reinvested dividend equivalents, shares 974  
Forfeited, shares (1,321)  
Nonvested, end of period, shares 27,276 22,241
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]    
Nonvested, beginning of period, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 32.64  
Granted, weighted-average grant-date fair value per share (in dollars per share) | $ / shares 35.90  
Vested, weighted-average grant date fair value per share (in dollars per share) | $ / shares [1] 34.02  
Reinvested dividend equivalents, weighted-average grant date fair value per share (in dollars per share) | $ / shares 38.96  
Forfeited, weighted-average grant date fair value per share (in dollars per share) | $ / shares 33.85  
Nonvested, end of period, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 33.70 $ 32.64
Number of shares modified to accelerate vesting 150 6,400
Number of employees affected by accelerated vesting | Employee 140 9,900
[1] Includes the modification of approximately 200 thousand PPSs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
v3.10.0.1
Share-Based Payments - Data Related to All Restricted Stock Unit Activity (Detail) - Restricted Stock Units [Member]
shares in Thousands, $ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
Employee
shares
Dec. 31, 2017
USD ($)
Employee
shares
Dec. 31, 2016
USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Total fair value of shares vested | $ [1] $ 146 $ 584 $ 293
Total compensation cost related to nonvested RSU awards not yet recognized, pre-tax | $ $ 256 $ 254 $ 262
Weighted-average period over which RSU cost is expected to be recognized (years) 1 year 8 months 12 days 1 year 8 months 12 days 1 year 8 months 12 days
Number of shares modified to accelerate vesting | shares 150 6,400  
Number of employees affected by accelerated vesting | Employee 140 9,900  
Number of shares scheduled for near-term vesting | shares   6,600  
[1] 2018 includes modification of approximately 150 thousand RSUs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit vesting upon termination. The impact to the compensation expense was immaterial. 2017 includes the modification for a commitment to pay approximately 6.4 million RSUs to approximately 9,900 employees, including senior and key management employees, for 6.6 million RSUs. These shares were paid in the first quarter of 2018.
v3.10.0.1
Share-Based Payments - Portfolio Performance Shares Narrative (Details) - Portfolio Performance Shares [Member]
 12 Months Ended
Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Award requisite service period 3 years
Award vesting period 5 years
Minimum [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares earned as a percentage of initial award 0.00%
Maximum [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares earned as a percentage of initial award 200.00%
v3.10.0.1
Share-Based Payments - Portfolio Performance Shares Activity (Details)
shares in Thousands
 12 Months Ended
Dec. 31, 2018
Employee
$ / shares
shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]  
Vested and expected to vest, end of period, shares 103,621 [1]
Portfolio Performance Shares [Member]  
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]  
Nonvested, beginning of period, shares 20,973
Granted, shares 6,769
Vested, shares (7,483) [2]
Forfeited, shares (998)
Nonvested, end of period, shares 19,261 [3]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]  
Nonvested, beginning of period, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 36.22
Granted, weighted-average grant date fair value per share (in dollars per share) | $ / shares 35.74
Vested, weighted-average grant date fair value per share (in dollars per share) | $ / shares 37.31 [2]
Forfeited, weighted-average grant date fair value per share (in dollars per share) | $ / shares 38.23
Nonvested, end of period, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 43.65 [3]
Number of shares modified to accelerate vesting 200
Number of employees affected by accelerated vesting | Employee 140
Vested and expected to vest, end of period, shares 33,900
[1] The number of options expected to vest takes into account an estimate of expected forfeitures.
[2] Includes the modification of approximately 200 thousand PPSs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
[3] Vested and non-vested shares outstanding, but not paid as of December 31, 2018 were 33.9 million.
v3.10.0.1
Share-Based Payments - Data Related to All Portfolio Performance Shares Activity (Details) - Portfolio Performance Shares [Member]
shares in Thousands, $ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
Employee
shares
Dec. 31, 2017
USD ($)
Dec. 31, 2016
USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Total fair value of shares vested [1] $ 169 $ 131 $ 118
Total compensation cost related to nonvested awards not yet recognized, pre-tax $ 102 $ 94 $ 93
Weighted-average period over which nonvested award cost is expected to be recognized (years) 1 year 9 months 18 days 1 year 8 months 12 days 1 year 9 months 18 days
Number of shares modified to accelerate vesting | shares 200    
Number of employees affected by plan modification | Employee 140    
[1] Includes the modification of approximately 200 thousand PPSs to approximately 140 employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.
v3.10.0.1
Share-Based Payments - Performance Share Awards (PSAs) Narrative (Details) - Performance Shares [Member]
 12 Months Ended
Dec. 31, 2018
measure
period
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of measures used to determine share payout | measure 2
Share payout measures, operating income, number of periods | period 3
Share payout measures, operating income, duration of period 1 year
Award vesting period 3 years
Minimum [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares earned as a percentage of initial award 0.00%
Maximum [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Number of shares earned as a percentage of initial award 200.00%
v3.10.0.1
Share-Based Payments - Performance Share Awards (PSAs) Activity (Details) - Performance Shares [Member]
shares in Thousands
 12 Months Ended
Dec. 31, 2018
$ / shares
shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]  
Nonvested, beginning of period, shares | shares 4,024
Granted, shares | shares 1,833
Vested, shares | shares (112) [1]
Forfeited, shares | shares (463)
Nonvested, end of period, shares | shares 5,282
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]  
Nonvested, beginning of period, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 36.22
Granted, weighted-average grant date fair value per share (in dollars per share) | $ / shares 35.74
Vested, weighted-average grant date fair value per share (in dollars per share) | $ / shares 39.58 [1]
Forfeited, weighted-average grant date fair value per share (in dollars per share) | $ / shares 37.12
Nonvested, end of period, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 43.65
[1] Includes the modification of a few PSAs to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial.The following table provides data related to all PSA activity: Year Ended December 31,(MILLIONS OF DOLLARS) 2018 2017 2016Total fair value of shares vested(a) $4 $58 $9Total compensation cost related to nonvested PSA grants not yet recognized, pre-tax $41 $34 $30Weighted-average period over which PSA cost is expected to be recognized (years) 1.8 1.8 1.8
v3.10.0.1
Share-Based Payments - Data Related to All Performance Share Awards (PSAs) (Details) - Performance Shares [Member]
shares in Millions, $ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Employee
shares
Dec. 31, 2016
USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Total fair value of shares vested | $ [1] $ 4 $ 58 $ 9
Total compensation cost related to nonvested awards not yet recognized, pre-tax | $ $ 41 $ 34 $ 30
Weighted-average period over which nonvested award cost is expected to be recognized (years) 1 year 9 months 18 days 1 year 9 months 18 days 1 year 9 months 18 days
Number of shares modified to accelerate vesting | shares   1.1  
Number of employees affected by plan modification | Employee   90  
Number of shares scheduled for near-term vesting | shares   1.1  
[1] Includes the 2018 modification of a few PSAs to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit the vesting upon termination. The impact to compensation expense was immaterial. Includes the 2017 modification for a commitment to pay 1.1 million PSAs to approximately 90 employees, including senior and key management employees, for 1.1 million PSAs. These shares were paid in the first quarter of 2018.
v3.10.0.1
Share-Based Payments - Stock Option Narrative (Details)
 12 Months Ended
Dec. 31, 2018
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Granted, shares 1,372,000
Employee Stock Option [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Award vesting period 3 years
Contractual term (years) 10 years
Holding period 1 year
Exercise period in the event of a divestiture or restructuring 3 months
Management [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Granted, shares 0
v3.10.0.1
Share-Based Payments - Valuation Assumptions of Stock Options (Detail) - Employee Stock Option [Member]
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Expected dividend yield [1] 3.73% 3.69% 3.85%
Risk-free interest rate [2] 2.85% 2.23% 1.55%
Expected stock price volatility [3] 20.02% 18.39% 21.64%
Expected term (years) [4] 6 years 9 months 6 years 9 months 6 years 9 months
[1] Determined using a constant dividend yield during the expected term of the option.
[2] Determined using the interpolated yield on U.S. Treasury zero-coupon issues.
[3] Determined using implied volatility, after consideration of historical volatility.
[4] Determined using historical exercise and post-vesting termination patterns.
v3.10.0.1
Share-Based Payments - Stock Option Activity (Detail)
$ / shares in Units, shares in Thousands, $ in Millions
 12 Months Ended
Dec. 31, 2018
USD ($)
$ / shares
shares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]  
Outstanding, beginning of period, shares 150,757
Granted, shares 1,372
Exercised, shares (47,740)
Forfeited, shares (219)
Expired, shares (379)
Outstanding, end of period, shares 103,791 [1]
Vested and expected to vest, end of period, shares 103,621 [2]
Exercisable, end of period, shares 100,078
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]  
Outstanding, beginning of period, weighted-average exercise price per share (in dollars per share) | $ / shares $ 27.27
Granted, weighted-average exercise price per share (in dollars per share) | $ / shares 35.74
Exercised, weighted-average exercise price per share (in dollars per share) | $ / shares 26.59
Forfeited, weighted-average exercise price per share (in dollars per share) | $ / shares 33.96
Expired, weighted-average exercise price per share (in dollars per share) | $ / shares 24.69
Outstanding, end of period, weighted-average exercise price per share (in dollars per share) | $ / shares 27.69 [1]
Vested and expected to vest, end of period, weighted-average exercise price per share (in dollars per share) | $ / shares 27.68 [2]
Exercisable, end of period, weighted-average exercise price per share (in dollars per share) | $ / shares $ 27.47
Outstanding, end of period, weighted-average remaining contractual term 4 years 5 months [1]
Vested and expected to vest, end of period, weighted-average remaining contractual term 4 years 5 months [2]
Exercisable, end of period, weighted-average remaining contractual term 4 years 2 months
Outstanding, end of period, aggregate intrinsic value | $ $ 1,657 [1],[3]
Vested and expected to vest, end of period, aggregate intrinsic value | $ 1,655 [2],[3]
Exercisable, end of period, aggregate intrinsic value | $ $ 1,619 [3]
Employee Stock Option [Member]  
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]  
Number of shares modified to accelerate vesting 190
[1] Includes the modification of approximately 190 thousand stock options to a few employees, including management employees, in connection with our Organizing for Growth initiative. The terms were modified to permit a longer exercise term after termination.
[2] The number of options expected to vest takes into account an estimate of expected forfeitures.
[3] Market price of our underlying common stock less exercise price.
v3.10.0.1
Share-Based Payments - Data Related to All Stock Option Activity (Detail) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Weighted-average grant-date fair value per stock option (in dollars per share) $ 5.06 $ 4.01 $ 3.89
Aggregate intrinsic value on exercise $ 625 $ 331 $ 389
Cash received upon exercise [1] 1,259 862 1,019
Tax benefits realized related to exercise 115 95 112
Employee Stock Option [Member]      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Total compensation cost related to nonvested stock options not yet recognized, pre-tax $ 5 $ 10 $ 58
Weighted-average period over which stock option compensation cost is expected to be recognized (years) 1 year 8 months 9 months 18 days 1 year 1 month 6 days
[1] Amounts may not add due to rounding.
v3.10.0.1
Earnings Per Common Share Attributable to Pfizer Inc. Common Shareholders - Basic and Diluted (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
EPS Numerator-Basic      
Income from continuing operations [1] $ 11,179 $ 21,353 $ 7,229
Less: Net income attributable to noncontrolling interests 36 47 31
Income from continuing operations attributable to Pfizer Inc. 11,143 21,306 7,198
Less: Preferred stock dividends––net of tax 1 1 1
Income from continuing operations attributable to Pfizer Inc. common shareholders 11,142 21,305 7,197
Discontinued operations––net of tax [1] 10 2 17
Less: Discontinued operations––net of tax, attributable to noncontrolling interests 0 0 0
Discontinued operations––net of tax, attributable to Pfizer Inc. common shareholders 10 2 17
Net income attributable to Pfizer Inc. common shareholders 11,152 21,307 7,214
EPS Numerator––Diluted      
Income from continuing operations attributable to Pfizer Inc. common shareholders and assumed conversions 11,143 21,306 7,197
Net income attributable to Pfizer Inc. common shareholders and assumed conversions $ 11,153 $ 21,308 $ 7,214
EPS Denominator      
Weighted-average number of common shares outstanding––Basic [1],[2] 5,872.0 5,970.0 6,089.0
Common-share equivalents: stock options, stock issuable under employee compensation plans, convertible preferred stock and accelerated share repurchase agreements [2] 105.0 89.0 70.0
Weighted-average number of common shares outstanding––Diluted [1],[2] 5,977.0 6,058.0 6,159.0
Cash dividends declared per share (in dollars per share) $ 1.38 $ 1.30 $ 1.22
Equity Option [Member]      
EPS Denominator      
Stock options that had exercise prices greater than the average market price of our common stock issuable under employee compensation plans [3] 2.0 36.0 63.0
Common Stock [Member]      
EPS Denominator      
Number of shares modified to accelerate vesting   15.2  
[1] Amounts may not add due to rounding.
[2] 2017 includes the effect of the modification for a commitment to pay 15.2 million common-share equivalents that were scheduled for near-term settlement.
[3] These common stock equivalents were outstanding for the periods presented, but were not included in the computation of diluted EPS for those periods because their inclusion would have had an anti-dilutive effect.
v3.10.0.1
Lease Commitments (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Leases [Abstract]      
Operating leases, rent expense, net $ 301 $ 314 $ 292
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]      
2019 300    
2020 252    
2021 210    
2022 267    
2023 248    
After 2023 $ 2,040    
v3.10.0.1
Contingencies and Certain Commitments (Action In Which We Are the Plaintiff) (Details)
 1 Months Ended 3 Months Ended
Jun. 30, 2018
Patents
Feb. 28, 2018
Patents
Jan. 31, 2018
Patents
Dec. 31, 2017
Patents
Oct. 31, 2017
Patents
Sep. 30, 2017
Patents
Jul. 31, 2017
Patents
Mar. 31, 2017
Patents
Feb. 28, 2017
Patents
Aug. 31, 2016
Patents
Jul. 31, 2016
Patents
Jan. 31, 2016
Patents
Jun. 30, 2015
Patents
Apr. 30, 2017
Defendant
Patents
Patent Infringement [Member] | Judicial Ruling [Member]                            
Gain Contingencies [Line Items]                            
Number of patents infringed upon 1                          
Bosulif [Member] | Wyeth Versus Sun [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon           2                
Precedex Premix [Member] | Hospira Versus Amneal Pharmaceuticals LLC [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents found not infringed upon                         4  
Precedex Premix [Member] | Hospira Versus Amneal Pharmaceuticals LLC [Member] | Settled Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents infringed upon     1                      
Number of patents found not infringed upon     3                      
Precedex Premix [Member] | Hospira Versus Par [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents found not infringed upon                   4        
Precedex Premix [Member] | Hospira Versus Gland [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon   4                        
Number of patents found not infringed upon       6                    
Precedex Premix [Member] | Hospira Versus Hengrui [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon   4                        
Number of patents found not infringed upon       6                    
Precedex Premix [Member] | Hospira Versus Baxter [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents found not infringed upon   4                        
Number of patents due to expire in 2019   1                        
Number of patents due to expire in 2032   3                        
Xeljanz [Member] | Pfizer Versus MicroLabs [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon                 3          
Xeljanz [Member] | Pfizer Versus Zydus [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon               3            
Xeljanz [Member] | Pfizer Versus Prinston and Breckenridge [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon               2            
Xeljanz [Member] | Pfizer Versus Breckenridge [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon         4                  
Number of patents allegedly infringed upon due to expire in December 2020         3                  
Number of patents allegedly infringed upon due to expire in December 2025         1                  
Toviaz [Member] | Pfizer Versus Mylan Laboratories and Accord Healthcare Inc. [Member] | Patent Infringement [Member] | Judicial Ruling [Member]                            
Gain Contingencies [Line Items]                            
Number of patents found not infringed upon             5              
Toviaz [Member] | Pfizer Versus Mylan Laboratories and Accord Healthcare Inc. [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon                     5 5    
Toviaz Composition-of-matter Patents [Member] | Pfizer Versus Mylan Laboratories and Accord Healthcare Inc. [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents infringed upon                       3    
Eliquis [Member] | Pfizer and BMS Versus Several Generic Manufacturers [Member] | Patent Infringement [Member] | Pending Litigation [Member]                            
Gain Contingencies [Line Items]                            
Number of patents allegedly infringed upon                           3
Number of defendants | Defendant                           25
v3.10.0.1
Contingencies and Certain Commitments (Action In Which We Are The Defendant) (Details)
$ in Thousands, £ in Millions
 1 Months Ended
Oct. 31, 2018
manufacturer
May 31, 2018
USD ($)
Nov. 30, 2017
USD ($)
Jul. 31, 2017
Patents
Mar. 31, 2015
Patents
Mar. 31, 2013
lagoon
Dec. 31, 2018
Claim
Dec. 31, 2016
GBP (£)
Celebrex [Member] | Pending Litigation [Member]                
Loss Contingencies [Line Items]                
Litigation settlement, amount awarded to other party | $     $ 94,000          
Janssen and New York University Versus Hospira, Celltrion Healthcare and Celltrion Inc. [Member] | Inflectra [Member]                
Loss Contingencies [Line Items]                
Number of patents allegedly infringed         6      
Janssen and New York University Versus Hospira, Celltrion Healthcare and Celltrion Inc. [Member] | Inflectra [Member] | Settled Litigation [Member]                
Loss Contingencies [Line Items]                
Number of claims dismissed         4      
Janssen and New York University Versus Hospira, Celltrion Healthcare and Celltrion Inc. [Member] | Inflectra [Member] | Pending Litigation [Member]                
Loss Contingencies [Line Items]                
Number of patents allegedly infringed         2      
Pfizer And Various Other Manufacturers Versus Mississippi Attorney General [Member] | Docetaxel [Member] | Pending Litigation [Member]                
Loss Contingencies [Line Items]                
Number of defendants other than main defendant | manufacturer 8              
Patent Infringement [Member] | Pfizer Versus BMS, E.R. Squibb & Sons, Ono Pharmaceutical and Tasuku Honjo [Member] | Bavencio [Member] | Pending Litigation [Member]                
Loss Contingencies [Line Items]                
Number of patents allegedly infringed       1        
Damages from Product Defects [Member] | Class Action Versus American Optical Corporation And Various Other Defendants [Member] | Pending Litigation [Member]                
Loss Contingencies [Line Items]                
Number of claims seeking damages | Claim             46,400  
Average Wholesale Price [Member] | State of Illinois Versus Pfizer [Member] | Pending Litigation [Member]                
Loss Contingencies [Line Items]                
Number of claims seeking damages | Claim             1  
Environmental Remediation Litigation [Member]                
Loss Contingencies [Line Items]                
Feasibility study, number of lagoons | lagoon           2    
Violation of Antitrust Laws [Member] | Phenytoin Sodium Capsules [Member]                
Loss Contingencies [Line Items]                
Imposed fine | £               £ 84.2
Copayment Assistance Organizations [Member] | Pfizer Versus United States District Of Massachusetts [Member] | Settled Litigation [Member]                
Loss Contingencies [Line Items]                
Litigation settlement, amount awarded to other party | $   $ 23,850            
Term of corporate integrity agreement   5 years            
v3.10.0.1
Contingencies and Certain Commitments (Certain Matters Resolved And Commitments) (Details) - USD ($)
$ in Millions
 1 Months Ended 12 Months Ended
Dec. 31, 2017
Aug. 31, 2017
Dec. 31, 2018
Loss Contingencies [Line Items]      
Long-term purchase commitment, amount     $ 3,700
Repatriation tax liability $ 15,200   $ 15,000
Besponsa [Member]      
Loss Contingencies [Line Items]      
Research and development arrangement, aggregate payment obligation, term     8 years
Research arrangement, fixed payment obligation     $ 422
Bosulif [Member]      
Loss Contingencies [Line Items]      
Research and development arrangement, aggregate payment obligation, term     9 years
United States [Member] | Besponsa [Member]      
Loss Contingencies [Line Items]      
Research and development arrangement, aggregate payment obligation, term   9 years  
Research arrangement, fixed payment obligation   $ 296  
United States [Member] | Bosulif [Member]      
Loss Contingencies [Line Items]      
Research and development arrangement, aggregate payment obligation, term 10 years    
Research arrangement, fixed payment obligation $ 416   $ 240
v3.10.0.1
Segment, Geographic and Other Revenue Information - Narrative (Detail)
$ in Millions
 12 Months Ended 33 Months Ended
Dec. 31, 2018
USD ($)
Operating_Segment
Country
Dec. 31, 2017
USD ($)
Country
Dec. 31, 2016
USD ($)
Dec. 31, 2018
USD ($)
Operating_Segment
Country
Segment Reporting Information [Line Items]        
Number of operating segments | Operating_Segment 2     2
Total assets [1] $ 159,422 $ 171,797   $ 159,422
Geographic Concentration Risk [Member] | Sales Revenue, Goods, Net [Member] | Outside United States [Member]        
Segment Reporting Information [Line Items]        
Number of countries outside the U.S | Country 11 11   11
Geographic Concentration Risk [Member] | Sales Revenue, Goods, Net [Member] | United States [Member]        
Segment Reporting Information [Line Items]        
Percentage of total revenues 10.00% 10.00% 10.00%  
Geographic Concentration Risk [Member] | Sales Revenue, Goods, Net [Member] | JAPAN        
Segment Reporting Information [Line Items]        
Percentage of total revenues 8.00% 8.00% 8.00%  
Geographic Concentration Risk [Member] | Sales Revenue, Goods, Net [Member] | CHINA        
Segment Reporting Information [Line Items]        
Percentage of total revenues 8.00% 7.00% 6.00%  
Customer Concentration Risk [Member] | Sales Revenue, Goods, Net [Member] | Domestic Wholesaler One [Member]        
Segment Reporting Information [Line Items]        
Percentage of total revenues 15.00% 16.00% 16.00%  
Customer Concentration Risk [Member] | Sales Revenue, Goods, Net [Member] | Domestic Wholesaler Two [Member]        
Segment Reporting Information [Line Items]        
Percentage of total revenues 11.00% 12.00% 12.00%  
Customer Concentration Risk [Member] | Sales Revenue, Goods, Net [Member] | Domestic Wholesaler Three [Member]        
Segment Reporting Information [Line Items]        
Percentage of total revenues 10.00% 10.00% 10.00%  
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Three Largest U.S. Wholesaler Customers [Member]        
Segment Reporting Information [Line Items]        
Percentage of total revenues 34.00% 36.00% 29.00%  
Corporate [Member] | Scenario, Adjustment [Member]        
Segment Reporting Information [Line Items]        
Costs reclassified   $ (70) $ (43)  
Innovative Health Segment [Member] | Operating Segments [Member] | Scenario, Adjustment [Member]        
Segment Reporting Information [Line Items]        
Costs reclassified   (468) (312)  
Essential Health Segment [Member] | Operating Segments [Member] | Scenario, Adjustment [Member]        
Segment Reporting Information [Line Items]        
Costs reclassified   $ (176) $ (167)  
[1] Amounts may not add due to rounding.
v3.10.0.1
Segment, Geographic and Other Revenue Information (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Segment Reporting Information [Line Items]      
Revenues [1] $ 53,647 $ 52,546 $ 52,824
Income from continuing operations before provision for taxes on income [1],[2],[3],[4] 11,885 12,305 8,351
Depreciation and Amortization [5] 6,384 6,269 5,757
Operating Segments [Member]      
Segment Reporting Information [Line Items]      
Revenues 53,647 52,546 52,824
Income from continuing operations before provision for taxes on income [4] 30,970 30,269 29,231
Depreciation and Amortization [5] 1,175 1,113 1,183
Segment Reconciling Items [Member]      
Segment Reporting Information [Line Items]      
Revenues [6],[7] 0 0 0
Income from continuing operations before provision for taxes on income [4],[6],[7] (2,977) (3,137) (3,020)
Depreciation and Amortization [5],[6],[7] 93 90 85
Corporate [Member]      
Segment Reporting Information [Line Items]      
Revenues [6],[8] 0 0 0
Income from continuing operations before provision for taxes on income [4],[6],[8] (5,096) (5,452) (5,448)
Depreciation and Amortization [5],[6],[8] 363 337 356
Innovative Health Segment [Member] | Operating Segments [Member]      
Segment Reporting Information [Line Items]      
Revenues [8] 33,426 31,422 29,197
Income from continuing operations before provision for taxes on income [4],[8] 20,258 18,809 16,166
Depreciation and Amortization [5],[8] 629 534 583
Essential Health Segment [Member] | Operating Segments [Member]      
Segment Reporting Information [Line Items]      
Revenues [8] 20,221 21,124 23,627
Income from continuing operations before provision for taxes on income [4],[8] 10,712 11,460 13,065
Depreciation and Amortization [5],[8] 547 579 600
Purchase Accounting Adjustments [Member] | Segment Reconciling Items [Member]      
Segment Reporting Information [Line Items]      
Revenues [6] 0 0 0
Income from continuing operations before provision for taxes on income [4],[6] (4,786) (4,758) (4,185)
Depreciation and Amortization [5],[6] 4,620 4,565 3,890
Acquisition-Related Costs [Member] | Segment Reconciling Items [Member]      
Segment Reporting Information [Line Items]      
Revenues [6] 0 0 0
Income from continuing operations before provision for taxes on income [4],[6] (318) (456) (785)
Depreciation and Amortization [5],[6] 12 39 7
Certain Significant Items [Member] | Segment Reconciling Items [Member]      
Segment Reporting Information [Line Items]      
Revenues [9] 0 0 0
Income from continuing operations before provision for taxes on income [4],[9] (4,305) (2,647) (5,888)
Depreciation and Amortization [5],[9] 38 52 200
Other Unallocated [Member] | Segment Reconciling Items [Member]      
Segment Reporting Information [Line Items]      
Revenues [6],[8] 0 0 0
Income from continuing operations before provision for taxes on income [4],[6],[8] (1,603) (1,514) (1,554)
Depreciation and Amortization [5],[6],[8] $ 82 $ 72 $ 35
[1] Amounts may not add due to rounding.
[2] 2017 v. 2016––The decrease in the domestic loss was primarily due to lower restructuring charges and certain acquisition-related costs, the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower certain asset impairments and lower certain legal matters, partially offset by higher net losses on early retirement of debt, and higher amortization of intangible assets. The increase in international income was primarily due to the non-recurrence of the 2016 impairment on the remeasurement of HIS net assets, lower restructuring charges and certain acquisition-related costs, and lower certain asset impairments.
[3] 2018 v. 2017––The decrease in the domestic loss was primarily due to lower interest expense paid to certain foreign subsidiaries, lower net losses on the retirement of debt, higher net gains on investments in equity securities and increased revenue related to Eliquis, partially offset by higher certain asset impairments and lower revenue for Viagra and the SIP portfolio. The decrease in international income was primarily related to lower interest income received primarily from intercompany borrowings from Pfizer Inc. and higher charges related to certain cost reduction initiatives, partially offset by increased revenue related to Ibrance and Eliquis.
[4] Income from continuing operations before provision/(benefit) for taxes on income. IH’s earnings include dividend income from our investment in ViiV of $253 million in 2018 and $266 million in 2017. For additional information, see Note 4.
[5] Certain production facilities are shared. Depreciation is allocated based on estimates of physical production. Amounts here relate solely to the depreciation and amortization associated with continuing operations.
[6] For a description, see the “Other Costs and Business Activities” section above.
[7] Other business activities includes the costs managed by our WRD and GPD organizations.
[8] In connection with the StratCO reporting change, in 2017, we reclassified approximately $468 million of costs from IH, approximately $176 million of costs from EH and approximately $70 million of costs from Corporate to Other unallocated costs, and in 2016, we reclassified approximately $312 million of costs from IH, approximately $167 million of costs from EH and approximately $43 million of costs from Corporate to Other unallocated costs to conform to the current period presentation.
[9] Certain significant items are substantive and/or unusual, and in some cases recurring, items (such as restructuring or legal charges) that, either as a result of their nature or size, would not be expected to occur as part of our normal business on a regular basis. For Earnings in 2018, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $977 million, (ii) net charges for certain legal matters of $157 million, (iii) income of $1 million, representing an adjustment to amounts previously recorded to write down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $3.1 billion, (v) charges for business and legal entity alignment of $4 million, (vi) net losses on early retirement of debt of $3 million and (vii) other charges of $65 million, which includes, among other things, a non-cash $343 million pre-tax gain in Other (income)/deductions––net associated with our transaction with Bain Capital to create a new biopharmaceutical company, Cerevel, to continue development of a portfolio of clinical and preclinical stage neuroscience assets primarily targeting disorders of the central nervous system, a $119 million charge, in the aggregate, in Selling, informational and administrative expenses, for a special one-time bonus paid to virtually all Pfizer colleagues, excluding executives, which was one of several actions taken by us after evaluating the expected positive net impact of the December 2017 enactment of the legislation commonly referred to as the TCJA, $59 million of incremental costs associated with the design, planning and implementation of the new organizational structure, effective in the beginning of 2019, and primarily including consulting, legal, tax, and advisory services and a non-cash $50 million pre-tax gain in Other (income)/deductions––net as a result of the contribution of our allogeneic CAR T cell therapy development program assets in connection with our contribution agreement entered into with Allogene. For additional information, see Note 2B, Note 3 and Note 4.For Earnings in 2017, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $204 million, (ii) charges for certain legal matters of $237 million, (iii) charges of $55 million, representing adjustments to amounts previously recorded to write-down the HIS net assets to fair value less costs to sell, (iv) certain asset impairment charges of $379 million, (v) charges for business and legal entity alignment of $71 million, (vi) net losses on early retirement of debt of $999 million and (vii) other charges of $700 million. For additional information, see Note 2B, Note 3 and Note 4.For Earnings in 2016, certain significant items includes: (i) restructuring charges and implementation costs associated with our cost-reduction initiatives that are not associated with an acquisition of $1.4 billion, (ii) charges for certain legal matters of $494 million, (iii) an impairment charge related to the write-down of the HIS net assets to fair value less estimated costs to sell of $1.7 billion, (iv) certain asset impairment charges of $1.4 billion, (v) charges for business and legal entity alignment of $261 million, (vi) net losses on early retirement of debt of $312 million and (vii) other charges of $294 million. For additional information, see Note 3 and Note 4.
v3.10.0.1
Segment, Geographic and Other Revenue Information - Footnotes (Detail) - USD ($)
$ in Millions
 1 Months Ended 3 Months Ended 12 Months Ended
Sep. 30, 2018
Dec. 31, 2017
Nov. 30, 2016
Jul. 01, 2018
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Segment Reporting Information [Line Items]              
Litigation settlement income (loss) [1]         $ (157) $ (240) $ (510)
Income (Loss) on sale of HIS net assets [2],[3]         1 (55) (1,712)
Business and legal entity alignment costs [4]         4 71 261
Loss on early retirement of debt   $ 999 $ 312   3 [5] 999 [5] 312 [5]
Gain associated with Bain Capital transaction [7]         586 [6] 224 18
Segment Reconciling Items [Member]              
Segment Reporting Information [Line Items]              
Restructuring charges and implementation costs         977 204 1,400
Litigation settlement income (loss)         (157) (237)  
Business and legal entity alignment costs         4 71  
Loss on early retirement of debt         3 [5] 999 312
Certain asset impairments         3,100 379 1,400
Other income (charges)         (65) (700) (294)
One-time bonus paid to all Pfizer colleagues excluding executives         119    
Other legal matters, net             494
Alignment costs             261
HIS [Member] | Segment Reconciling Items [Member]              
Segment Reporting Information [Line Items]              
Income (Loss) on sale of HIS net assets         (1) (55) (1,700)
Scenario, Adjustment [Member] | Corporate [Member]              
Segment Reporting Information [Line Items]              
Costs reclassified           (70) (43)
Innovative Health Segment [Member] | Scenario, Adjustment [Member] | Operating Segments [Member]              
Segment Reporting Information [Line Items]              
Costs reclassified           (468) (312)
Essential Health Segment [Member] | Scenario, Adjustment [Member] | Operating Segments [Member]              
Segment Reporting Information [Line Items]              
Costs reclassified           (176) $ (167)
ViiV Healthcare Limited [Member]              
Segment Reporting Information [Line Items]              
Dividend income         253    
ViiV Healthcare Limited [Member] | Innovative Health Segment [Member]              
Segment Reporting Information [Line Items]              
Dividend income           266  
ViiV Healthcare Limited [Member] | Innovative Health Segment [Member] | Operating Segments [Member]              
Segment Reporting Information [Line Items]              
Dividend income         253 $ 266  
Allogene [Member]              
Segment Reporting Information [Line Items]              
Gain from contribution agreement       $ 50 50    
Allogene [Member] | Segment Reconciling Items [Member]              
Segment Reporting Information [Line Items]              
Gain from contribution agreement         50    
Bain Capital [Member] | Cerevel [Member]              
Segment Reporting Information [Line Items]              
Gain associated with Bain Capital transaction $ 343       343    
Bain Capital [Member] | Cerevel [Member] | Segment Reconciling Items [Member]              
Segment Reporting Information [Line Items]              
Gain associated with Bain Capital transaction         343    
2017-2019 Initiatives and Organizing for Growth Initiative [Member]              
Segment Reporting Information [Line Items]              
Legal, tax and advisory service expense         59    
2017-2019 Initiatives and Organizing for Growth Initiative [Member] | Segment Reconciling Items [Member]              
Segment Reporting Information [Line Items]              
Legal, tax and advisory service expense         $ 59    
[1] In 2018, primarily includes legal reserves for certain pending legal matters, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In 2017, primarily includes a $94 million charge to resolve a class action lawsuit filed by direct purchasers relating to Celebrex, which was approved by the court in April 2018, and a $79 million charge to reflect damages awarded by a jury in a patent matter. In 2016, primarily includes amounts to resolve a Multi-District Litigation relating to Celebrex and Bextra pending against the Company in New York federal court for $486 million, partially offset by the reversal of a legal accrual where a loss was no longer deemed probable. In addition, 2016 includes a settlement related to a patent matter.
[2] Amounts may not add due to rounding.
[3] In 2018 and 2017, represents adjustments to amounts previously recorded in 2016 to write down the HIS net assets to fair value less costs to sell related to the sale of HIS net assets to ICU Medical on February 3, 2017. In 2016, represents a charge related to the write-down of the HIS net assets to fair value less estimated costs to sell. See Note 2B for additional information.
[4] Represents expenses for changes to our infrastructure to align our commercial operations that existed through December 31, 2018, including costs to internally separate our businesses into distinct legal entities, as well as to streamline our intercompany supply operations to better support each business.
[5] In 2017 and 2016, represents net losses due to the early retirement of debt, inclusive of the related termination of cross currency swaps in 2017 and inclusive of the related termination of interest rate swaps in 2016.
[6] The net gains on investments in equity securities are reported in Other (income)/deductions––net and, for 2018, include unrealized net gains on equity securities reflecting the adoption of a new accounting standard in the first quarter of 2018. For additional information, see Note 4.
[7] The net gains on investments in equity securities in 2018, include unrealized net gains on equity securities of $477 million, reflecting the adoption of a new accounting standard in the first quarter of 2018. Net gains in 2018 were primarily driven by unrealized gains of $466 million related to our investment in Allogene. Prior to the adoption of a new accounting standard in the first quarter of 2018, net unrealized gains and losses on virtually all equity securities with readily determinable fair values were reported in Accumulated other comprehensive income. For additional information, see Note 1B, Note 2B and Note 7B.
v3.10.0.1
Segment, Geographic and Other Revenue Information - Revenues By Geographic Area (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues [1] $ 53,647 $ 52,546 $ 52,824
United States [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues 25,329 26,026 26,369
Developed Europe [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues [2] 9,116 8,508 9,306
Developed Rest Of World [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues [3] 6,551 6,612 6,729
Emerging Markets [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues [4] $ 12,651 $ 11,399 $ 10,420
[1] Amounts may not add due to rounding.
[2] Developed Europe region includes the following markets: Western Europe, Scandinavian countries and Finland. Revenues denominated in euros were $7.3 billion in 2018, $6.8 billion in 2017 and $7.2 billion in 2016.
[3] Developed Rest of World region includes the following markets: Japan, Canada, South Korea, Australia and New Zealand.
[4] Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Eastern Europe, Africa, the Middle East, Central Europe and Turkey.
v3.10.0.1
Segment, Geographic and Other Revenue Information - Revenues By Geographic Area - Footnotes (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues [1] $ 53,647 $ 52,546 $ 52,824
Developed Europe [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues [2] 9,116 8,508 9,306
Euro Member Countries, Euro | Developed Europe [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Revenues $ 7,300 $ 6,800 $ 7,200
[1] Amounts may not add due to rounding.
[2] Developed Europe region includes the following markets: Western Europe, Scandinavian countries and Finland. Revenues denominated in euros were $7.3 billion in 2018, $6.8 billion in 2017 and $7.2 billion in 2016.
v3.10.0.1
Segment, Geographic and Other Revenue Information - Long-Lived Assets By Geographic Region (Detail) - USD ($)
$ in Millions
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Revenues from External Customers and Long-Lived Assets [Line Items]      
Property, plant and equipment, net $ 13,385 [1],[2] $ 13,865 [1],[2] $ 13,318
United States [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Property, plant and equipment, net 7,089 6,971 6,649
Developed Europe [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Property, plant and equipment, net [3] 4,204 4,345 4,228
Developed Rest Of World [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Property, plant and equipment, net [4] 490 632 643
Emerging Markets [Member]      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Property, plant and equipment, net [5] $ 1,602 $ 1,917 $ 1,797
[1] Amounts may not add due to rounding.
[2] The decrease in total property, plant and equipment is primarily due to depreciation, the reclassification of $675 million to Assets held for sale during the fourth quarter of 2018 (see Note 2C), reductions due to asset impairments largely associated with cost reduction initiatives not associated with acquisitions (see Note 3), and the impact of foreign exchange, partially offset by capital additions.
[3] Developed Europe region includes the following markets: Western Europe, Scandinavian countries and Finland.
[4] Developed Rest of World region includes the following markets: Japan, Canada, South Korea, Australia and New Zealand.
[5] Emerging Markets region includes, but is not limited to, the following markets: Asia (excluding Japan and South Korea), Latin America, Eastern Europe, Africa, the Middle East, Central Europe and Turkey.
v3.10.0.1
Segment, Geographic and Other Revenue Information - Revenues By Products (Detail) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Revenue from External Customer [Line Items]      
Revenues [1] $ 53,647 $ 52,546 $ 52,824
Innovative Health and Essential Health [Member]      
Revenue from External Customer [Line Items]      
Revenues 53,647 52,546 52,824
Innovative Health and Essential Health [Member] | Lyrica [Member]      
Revenue from External Customer [Line Items]      
Revenues [2] 4,970 5,065 4,966
Innovative Health and Essential Health [Member] | Viagra [Member]      
Revenue from External Customer [Line Items]      
Revenues [3] 636 1,204 1,564
Innovative Health and Essential Health [Member] | Alliance Biopharmaceuticals [Member]      
Revenue from External Customer [Line Items]      
Revenues 3,838 [4] 2,927 1,746
Innovative Health Business [Member] | Innovative Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues [5] 33,426 31,422 29,197
Essential Health Business [Member] | Essential Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues [6] 20,221 21,124 23,627
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues 9,996 9,684 8,858
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Lyrica [Member]      
Revenue from External Customer [Line Items]      
Revenues [2] 4,622 4,511 4,165
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Eliquis [Member]      
Revenue from External Customer [Line Items]      
Revenues 3,434 2,523 1,713
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Chantix Champix [Member]      
Revenue from External Customer [Line Items]      
Revenues 1,085 997 842
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | BMP2 [Member]      
Revenue from External Customer [Line Items]      
Revenues 279 261 251
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Toviaz [Member]      
Revenue from External Customer [Line Items]      
Revenues 271 257 258
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Viagra [Member]      
Revenue from External Customer [Line Items]      
Revenues [3] 0 823 1,181
Internal Medicine [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | All Other Internal Medicine [Member]      
Revenue from External Customer [Line Items]      
Revenues 306 312 447
Vaccines [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues 6,332 6,001 6,071
Vaccines [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Prevenar Family [Member]      
Revenue from External Customer [Line Items]      
Revenues 5,802 5,601 5,718
Vaccines [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | FSME-IMMUN/TicoVac [Member]      
Revenue from External Customer [Line Items]      
Revenues 184 134 114
Vaccines [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Trumenba [Member]      
Revenue from External Customer [Line Items]      
Revenues 116 88 84
Vaccines [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Other Vaccines Products [Member]      
Revenue from External Customer [Line Items]      
Revenues 230 177 155
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues 7,202 6,056 4,563
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Ibrance [Member]      
Revenue from External Customer [Line Items]      
Revenues 4,118 3,126 2,135
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Sutent [Member]      
Revenue from External Customer [Line Items]      
Revenues 1,049 1,081 1,095
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Xtandi Alliance [Member]      
Revenue from External Customer [Line Items]      
Revenues 699 590 140
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Xalkori [Member]      
Revenue from External Customer [Line Items]      
Revenues 524 594 561
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Inlyta [Member]      
Revenue from External Customer [Line Items]      
Revenues 298 339 401
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Bosulif [Member]      
Revenue from External Customer [Line Items]      
Revenues 296 233 167
Oncology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Other Oncology Products [Member]      
Revenue from External Customer [Line Items]      
Revenues 219 93 63
Inflammation and Immunology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues 4,080 3,968 3,928
Inflammation and Immunology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Enbrel [Member]      
Revenue from External Customer [Line Items]      
Revenues 2,112 2,452 2,909
Inflammation and Immunology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Xeljanz [Member]      
Revenue from External Customer [Line Items]      
Revenues 1,774 1,345 927
Inflammation and Immunology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Eucrisa [Member]      
Revenue from External Customer [Line Items]      
Revenues 147 67 0
Inflammation and Immunology [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | All Other Inflammation and Immunology Products [Member]      
Revenue from External Customer [Line Items]      
Revenues 46 103 93
Rare Disease [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues 2,211 2,240 2,369
Rare Disease [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Genotropin [Member]      
Revenue from External Customer [Line Items]      
Revenues 558 532 579
Rare Disease [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | BeneFIX [Member]      
Revenue from External Customer [Line Items]      
Revenues 554 604 712
Rare Disease [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | ReFacto AF Xyntha [Member]      
Revenue from External Customer [Line Items]      
Revenues 514 551 554
Rare Disease [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | Somavert [Member]      
Revenue from External Customer [Line Items]      
Revenues 267 254 232
Rare Disease [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member] | All Other Rare Disease Products [Member]      
Revenue from External Customer [Line Items]      
Revenues 318 300 292
Consumer Healthcare [Member] | Innovative Health Business [Member] | Innovative Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues 3,605 3,472 3,407
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues [7] 10,540 10,894 11,197
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Lipitor [Member]      
Revenue from External Customer [Line Items]      
Revenues 2,062 1,915 1,758
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Norvasc [Member]      
Revenue from External Customer [Line Items]      
Revenues 1,024 926 962
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Premarin Family [Member]      
Revenue from External Customer [Line Items]      
Revenues 832 977 1,017
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Xalatan Xalacom [Member]      
Revenue from External Customer [Line Items]      
Revenues 318 335 363
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Effexor [Member]      
Revenue from External Customer [Line Items]      
Revenues 311 297 278
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Epi Pen [Member]      
Revenue from External Customer [Line Items]      
Revenues 303 290 386
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Zoloft [Member]      
Revenue from External Customer [Line Items]      
Revenues 298 291 304
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Zithromax Zmax [Member]      
Revenue from External Customer [Line Items]      
Revenues 290 270 272
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Xanax/Xanax XR [Member]      
Revenue from External Customer [Line Items]      
Revenues 223 225 222
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Sildenafil Citrate [Member]      
Revenue from External Customer [Line Items]      
Revenues 56 56 0
Legacy Established Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Other Legacy Established Products [Member]      
Revenue from External Customer [Line Items]      
Revenues 4,822 5,313 5,636
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues [8] 5,214 5,673 6,014
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Sulperazon [Member]      
Revenue from External Customer [Line Items]      
Revenues 613 471 396
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Medrol [Member]      
Revenue from External Customer [Line Items]      
Revenues 427 483 450
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Fragmin [Member]      
Revenue from External Customer [Line Items]      
Revenues 293 306 318
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Tygacil [Member]      
Revenue from External Customer [Line Items]      
Revenues 249 260 274
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Zosyn / Tazocin [Member]      
Revenue from External Customer [Line Items]      
Revenues 229 194 146
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Precedex [Member]      
Revenue from External Customer [Line Items]      
Revenues 213 243 264
Sterile Injectable Pharmaceuticals [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | All Other Sterile Injectable Pharmaceuticals [Member]      
Revenue from External Customer [Line Items]      
Revenues 3,191 3,715 4,166
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues [9] 2,944 3,223 4,220
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Lyrica [Member]      
Revenue from External Customer [Line Items]      
Revenues [2] 347 553 801
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Viagra [Member]      
Revenue from External Customer [Line Items]      
Revenues [3] 636 382 383
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Celebrex [Member]      
Revenue from External Customer [Line Items]      
Revenues 686 775 733
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Vfend [Member]      
Revenue from External Customer [Line Items]      
Revenues 392 421 590
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Zyvox [Member]      
Revenue from External Customer [Line Items]      
Revenues 236 281 421
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Revatio [Member]      
Revenue from External Customer [Line Items]      
Revenues 227 252 285
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Pristiq [Member]      
Revenue from External Customer [Line Items]      
Revenues 206 303 732
Peri-LOE Products [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | All Other Peri-LOE Products [Member]      
Revenue from External Customer [Line Items]      
Revenues 213 257 276
Biosimilars [Member] | Essential Health Business [Member] | Essential Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues [10] 769 531 319
Biosimilars [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | Inflectra/Remsima [Member]      
Revenue from External Customer [Line Items]      
Revenues 642 419 192
Biosimilars [Member] | Essential Health Business [Member] | Essential Health Segment [Member] | All Other Biosimilars [Member]      
Revenue from External Customer [Line Items]      
Revenues 127 112 127
CentreOne [Member] | Essential Health Business [Member] | Essential Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues [11] 755 706 718
Hospira Infusion Systems [Member] | Essential Health Business [Member] | Essential Health Segment [Member]      
Revenue from External Customer [Line Items]      
Revenues $ 0 $ 97 $ 1,158
[1] Amounts may not add due to rounding.
[2] Lyrica revenues from all of Europe, Russia, Turkey, Israel and Central Asia countries are included in Lyrica EH. All other Lyrica revenues are included in Lyrica IH. Total Lyrica revenues represent the aggregate of worldwide revenues from Lyrica IH and Lyrica EH.
[3] Viagra lost exclusivity in the U.S. in December 2017. In 2018, revenues for Viagra in the U.S. and Canada, which were reported in IH through 2017, were reported in EH (which reported all other Viagra revenues excluding the U.S. and Canada through 2017). Therefore, in 2018, total Viagra worldwide revenues were reported in EH. Total Viagra revenues in 2017 and 2016 represented the aggregate of worldwide revenues from Viagra IH and Viagra EH.
[4] Substantially all relates to amounts earned from our partners under co-promotion agreements. The increases in 2018 and 2017 reflect increases in alliance revenues from Eliquis and Xtandi.
[5] The IH business encompasses Internal Medicine, Vaccines, Oncology, Inflammation & Immunology, Rare Disease and Consumer Healthcare. Through December 31, 2016, includes Duavive/Duavee and Viviant (recorded in All other Internal Medicine in 2016), which were transferred from Innovative Health to Essential Health effective January 1, 2017 (recorded in All other LEP (EH) beginning January 1, 2017), in order to align these products with our management of the women’s health portfolio within EH.
[6] The EH business encompasses Legacy Established Products, Sterile Injectable Pharmaceuticals, Peri-LOE Products, Biosimilars, Pfizer CentreOne and HIS (through February 2, 2017).
[7] Legacy Established Products primarily include products that have lost patent protection (excluding Sterile Injectable Pharmaceuticals and Peri-LOE Products). In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.Effective January 1, 2017, All other LEP includes Duavive/Duavee and Viviant, which were transferred from Innovative Health (recorded in All other Internal Medicine (IH) in 2016), in order to align these products with our management of the women’s health portfolio within EH. See note (a) above.
[8] Sterile Injectable Pharmaceuticals includes branded and generic injectables (excluding Peri-LOE Products). In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
[9] Peri-LOE Products include products that have recently lost or are anticipated to soon lose patent protection. These products primarily include: Lyrica in Europe, Russia, Turkey, Israel and Central Asia; and worldwide revenues for Celebrex, Pristiq, Zyvox, Vfend, Revatio and Inspra; and in 2018, Viagra revenues for all countries (and Viagra revenues for all countries other than the U.S. and Canada in 2017 and 2016), see note (c) above.
[10] Biosimilars include Inflectra/Remsima (biosimilar infliximab) in the U.S. and certain international markets, Nivestim (biosimilar filgrastim) in certain European, Asian and Africa/Middle Eastern markets and in the U.S. and Retacrit (biosimilar epoetin zeta) in the U.S. and certain European and Africa/Middle Eastern markets.
[11] Pfizer CentreOne includes revenues from our contract manufacturing and active pharmaceutical ingredient sales operation, including sterile injectables contract manufacturing, and revenues related to our manufacturing and supply agreements, including with Zoetis Inc. In the fourth quarter of 2017, we sold our equity share in Hisun Pfizer. As a result, effective in the first quarter of 2018, Hisun Pfizer-related revenues, previously reported in emerging markets within All Other LEP and All Other SIP, are reported in emerging markets within Pfizer CentreOne.
v3.10.0.1
Subsequent Event (Details) - USD ($)
shares in Millions
 12 Months Ended
Feb. 12, 2019
Feb. 07, 2019
Jun. 20, 2016
Mar. 10, 2016
Mar. 08, 2016
Dec. 31, 2018
Dec. 31, 2017
 [2]
Dec. 31, 2016
 [3]
Feb. 28, 2019
Oct. 23, 2014
Subsequent Event [Line Items]                    
Accelerated share repurchases, authorized amount         $ 5,000,000,000         $ 11,000,000,000
Accelerated share repurchases, cash paid       $ (5,000,000,000)            
Shares repurchased     18 136   307 [1] 150 154    
Accelerated share repurchase, percentage of agreement         80.00%          
Amount of remaining shares authorized in stock purchase plan, value           $ 14,200,000,000        
Subsequent Event [Member]                    
Subsequent Event [Line Items]                    
Accelerated share repurchases, authorized amount   $ 6,800,000,000                
Accelerated share repurchases, cash paid $ 6,800,000,000                  
Shares repurchased 130                  
Accelerated share repurchase, percentage of agreement   80.00%                
Amount of remaining shares authorized in stock purchase plan, value                 $ 5,300,000,000  
[1] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on March 12, 2018, as well as other share repurchases. See above for additional information.
[2] Represents shares purchased pursuant to the accelerated share repurchase agreement with Citibank entered into on February 2, 2017. See above for additional information.
[3] Represents shares purchased pursuant to the accelerated share repurchase agreement entered into on March 8, 2016. See above for additional information.