(MARK ONE)
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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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OR
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2016
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Delaware
(State or other jurisdiction of
incorporation or organization)
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32-0375147
(I.R.S. employer
identification number)
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1 North Waukegan Road
North Chicago, Illinois 60064-6400
(Address of principal executive offices) (Zip Code)
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(847) 932-7900
(Telephone number)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, par value $0.01 per share
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New York Stock Exchange
Chicago Stock Exchange
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Large Accelerated Filer
x
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Accelerated Filer
o
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Non-accelerated Filer
o
(Do not check if a
smaller reporting company)
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Smaller Reporting Company
o
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Page No.
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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(1)
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As used throughout the text of this report on Form 10-K, the terms "AbbVie" or "the company" refer to AbbVie Inc., a Delaware corporation, or AbbVie Inc. and its consolidated subsidiaries, as the context requires.
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1
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2016 Form 10-K
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Condition
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Principal Markets
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Rheumatoid arthritis (moderate to severe)
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North America, European Union
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Psoriatic arthritis
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North America, European Union
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Ankylosing spondylitis
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North America, European Union
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Adult Crohn's disease (moderate to severe)
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North America, European Union
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Plaque psoriasis (moderate to severe chronic)
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North America, European Union
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Juvenile idiopathic arthritis (moderate to severe polyarticular)
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North America, European Union
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Ulcerative colitis (moderate to severe)
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North America, European Union
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Axial spondyloarthropathy
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European Union
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Pediatric Crohn's disease (moderate to severe)
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North America, European Union
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Hidradenitis Suppurativa (moderate to severe)
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North America, European Union
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Pediatric enthesitis-related arthritis
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European Union
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Non-infectious intermediate, posterior and panuveitis
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North America, European Union
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2016 Form 10-K
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2
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3
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2016 Form 10-K
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2016 Form 10-K
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4
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5
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2016 Form 10-K
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2016 Form 10-K
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6
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•
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Phase 1—involves the first human tests in a small number of healthy volunteers or patients to assess safety, tolerability and potential dosing.
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•
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Phase 2—tests the drug's efficacy against the disease in a relatively small group of patients.
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Phase 3—tests a drug that demonstrates favorable results in the earlier phases in a significantly larger patient population to further demonstrate efficacy and safety based on regulatory criteria.
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7
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2016 Form 10-K
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2016 Form 10-K
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8
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9
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2016 Form 10-K
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2016 Form 10-K
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10
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11
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2016 Form 10-K
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2016 Form 10-K
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12
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13
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2016 Form 10-K
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2016 Form 10-K
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14
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15
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2016 Form 10-K
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•
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fluctuations in currency exchange rates;
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•
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changes in medical reimbursement policies and programs;
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•
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multiple legal and regulatory requirements that are subject to change and that could restrict AbbVie's ability to manufacture, market and sell its products;
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differing local product preferences and product requirements;
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trade protection measures and import or export licensing requirements;
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difficulty in establishing, staffing and managing operations;
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differing labor regulations;
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potentially negative consequences from changes in or interpretations of tax laws;
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political and economic instability, including sovereign debt issues;
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price and currency exchange controls, limitations on participation in local enterprises, expropriation, nationalization and other governmental action;
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inflation, recession and fluctuations in interest rates;
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potential deterioration in the economic position and credit quality of certain non-U.S. countries, including in Europe and Latin America; and
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potential penalties or other adverse consequences for violations of anti-corruption, anti-bribery and other similar laws and regulations, including the United States Foreign Corrupt Practices Act and the United Kingdom Bribery Act.
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2016 Form 10-K
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16
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17
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2016 Form 10-K
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•
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changes in or interpretations of laws and regulations, including changes in accounting standards, taxation requirements, product marketing application standards and environmental laws;
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differences between the fair value measurement of assets and liabilities and their actual value, particularly for pension and post-employment benefits, stock-based compensation, intangibles and goodwill; and for contingent liabilities such as litigation and contingent consideration, the absence of a recorded amount, or an amount recorded at the minimum, compared to the actual amount;
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changes in the rate of inflation (including the cost of raw materials, commodities and supplies), interest rates, market value of AbbVie's equity investments and the performance of investments held by it or its employee benefit trusts;
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changes in the creditworthiness of counterparties that transact business with or provide services to AbbVie or its employee benefit trusts;
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changes in the ability of third parties that provide information technology, accounting, human resources, payroll and other outsourced services to AbbVie to meet their contractual obligations to AbbVie; and
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changes in business, economic and political conditions, including: war, political instability, terrorist attacks, the threat of future terrorist activity and related military action; natural disasters; the cost and availability of insurance due to any of the foregoing events; labor disputes, strikes, slow-downs, or other forms of labor or union activity; and pressure from third-party interest groups.
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2016 Form 10-K
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18
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•
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the inability of AbbVie's stockholders to call a special meeting;
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the division of AbbVie's board of directors into three classes of directors, with each class serving a staggered three-year term;
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a provision that stockholders may only remove directors for cause;
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the ability of AbbVie's directors, and not stockholders, to fill vacancies on AbbVie's board of directors; and
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the requirement that the affirmative vote of stockholders holding at least 80% of AbbVie's voting stock is required to amend certain provisions in AbbVie's amended and restated certificate of incorporation and AbbVie's amended and restated by-laws relating to the number, term and election of AbbVie's directors, the filling of board vacancies, the calling of special meetings of stockholders and director and officer indemnification provisions.
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19
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2016 Form 10-K
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United States
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Outside the United States
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Abbott Park, Illinois*
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Campoverde di Aprilia, Italy
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Barceloneta, Puerto Rico
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Cork, Ireland
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Jayuya, Puerto Rico
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Ludwigshafen, Germany
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North Chicago, Illinois
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Singapore*
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South San Francisco, California
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Sligo, Ireland
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Worcester, Massachusetts*
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Wyandotte, Michigan*
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*
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Leased property.
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2016 Form 10-K
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20
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21
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2016 Form 10-K
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Name
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Age
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Position
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Richard A. Gonzalez
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63
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Chairman of the Board and Chief Executive Officer
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Carlos Alban
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54
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Executive Vice President, Commercial Operations
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William J. Chase
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49
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Executive Vice President, Chief Financial Officer
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Henry O. Gosebruch*
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44
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Executive Vice President and Chief Strategy Officer
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Laura J. Schumacher
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53
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Executive Vice President, External Affairs, General Counsel and Corporate Secretary
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Michael E. Severino, M.D.*
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51
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Executive Vice President, Research and Development and Chief Scientific Officer
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Timothy J. Richmond
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50
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Senior Vice President, Human Resources
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Azita Saleki-Gerhardt, Ph.D.
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53
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Senior Vice President, Operations
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Thomas A. Hurwich**
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56
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Vice President, Controller
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*
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Mr. Gosebruch was first appointed as a corporate officer in December 2015 and Dr. Severino was first appointed as a corporate officer in June 2014.
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**
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As previously announced, Mr. Hurwich will resign as AbbVie's Vice President, Controller, effective February 28, 2017.
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2016 Form 10-K
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22
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23
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2016 Form 10-K
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Market Price Per Share
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2016
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2015
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High
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Low
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High
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Low
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First Quarter
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$
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59.81
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$
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50.71
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$
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68.29
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$
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54.78
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Second Quarter
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$
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65.37
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$
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56.36
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$
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70.75
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$
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56.33
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Third Quarter
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$
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68.12
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$
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61.77
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$
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71.60
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$
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51.88
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Fourth Quarter
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$
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65.05
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$
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55.06
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$
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64.30
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$
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45.45
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2016
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2015
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Payment Date
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Date Declared
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Dividend Per Share
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Payment Date
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Date Declared
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Dividend Per Share
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11/15/16
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09/09/16
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$
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0.57
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11/16/15
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09/11/15
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$
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0.51
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08/15/16
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06/16/16
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$
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0.57
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08/14/15
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06/18/15
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$
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0.51
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05/16/16
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02/18/16
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$
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0.57
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05/15/15
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02/19/15
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$
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0.51
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02/16/16
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10/30/15
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$
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0.57
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02/13/15
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10/20/14
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$
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0.49
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2016 Form 10-K
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24
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Period
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(a) Total
Number
of Shares
(or Units)
Purchased
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(b) Average
Price
Paid per Share
(or Unit)
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(c) Total
Number of
Shares (or Units)
Purchased as Part
of Publicly
Announced
Plans or
Programs
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(d) Maximum Number (or
Approximate Dollar Value) of
Shares (or Units) that May
Yet Be Purchased Under the
Plans or Programs
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October 1, 2016 - October 31, 2016
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1,206,700
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(1)
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$
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56.03
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1,197,847
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$
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2,059,934,326
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(2)
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November 1, 2016 - November 30, 2016
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17,083,128
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(1)
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$
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60.07
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17,080,029
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$
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1,033,906,665
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(2)
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December 1, 2016 - December 31, 2016
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16,231,850
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(1)
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$
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61.56
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16,205,010
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$
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36,288,894
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(2)
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Total
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34,521,678
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(1)
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$
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60.63
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34,482,886
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$
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36,288,898
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(2)
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1.
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These shares represent:
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25
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2016 Form 10-K
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2.
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On October 20, 2014, AbbVie announced that its board of directors authorized the purchase of up to $5.0 billion of its common stock. The board of directors authorized increases to this repurchase program of $5.0 billion in March 2015 and $4.0 billion in April 2016 in anticipation of executing accelerated share repurchase agreements (ASRs) in connection with the acquisitions of Pharmacyclics and Stemcentrx. Purchases of AbbVie shares under this program may be made from time to time at management’s discretion. The program has no time limit and can be discontinued at any time.
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as of and for the years ended December 31 (in millions, except per share data)
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2016
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2015
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2014
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2013
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2012
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Statement of earnings data
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Net revenues
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$
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25,638
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$
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22,859
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$
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19,960
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$
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18,790
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$
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18,380
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Net earnings
(a)(b)
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5,953
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5,144
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1,774
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4,128
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5,275
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Basic earnings per share
(a)(b)
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$
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3.65
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$
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3.15
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$
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1.11
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$
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2.58
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$
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3.35
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Diluted earnings per share
(a)(b)
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$
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3.63
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$
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3.13
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$
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1.10
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$
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2.56
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$
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3.35
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Cash dividends declared per common share
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$
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2.35
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$
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2.10
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$
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1.75
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$
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2.00
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(c)
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n/a
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Weighted-average basic shares outstanding
(d)
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1,622
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1,625
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1,595
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1,589
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1,577
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Weighted-average diluted shares outstanding
(d)
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1,631
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1,637
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1,610
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1,604
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1,577
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Balance sheet data
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Total assets
(e)(f)
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$
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66,099
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$
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53,050
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$
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27,513
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$
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29,241
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$
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27,058
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Long-term debt and lease obligations
(e)(f)(g)
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36,465
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31,265
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14,552
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14,353
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14,702
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(a)
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AbbVie's historical financial statements for periods prior to January 1, 2013 reflected an allocation of expenses related to certain Abbott corporate functions, including senior management, legal, human resources, finance, information technology and quality assurance. These expenses were allocated to AbbVie based on direct usage or benefit where identifiable, with the remainder allocated on a pro rata basis of revenues, headcount, square footage, number of transactions or other measures. AbbVie considers the expense allocation methodology and results to be reasonable. However, the allocations may not be indicative of the actual expenses that would have been incurred had AbbVie operated as an independent, stand-alone, publicly-traded company for the periods presented. Accordingly, the historical financial information presented for periods prior to January 1, 2013 may not be indicative of the results of operations or financial position that would have been achieved if AbbVie had been an independent,
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2016 Form 10-K
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26
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(b)
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Results for
2016
,
2015
,
2014
and
2013
included higher expenses associated with operating as an independent, stand-alone, publicly-traded company than the historically derived financial statements for periods prior to January 1, 2013. The increases include the impact of interest expense on debt issued as a stand-alone company, a higher tax rate and other incremental costs of operating as an independent company. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations" for a discussion of other items that affected the comparability of financial results for
2016
,
2015
and
2014
, and the
2013
Form 10-K for
2013
and
2012
financial statements.
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(c)
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AbbVie declared regular quarterly cash dividends in 2013 aggregating $1.60 per share of common stock. In addition, a cash dividend of $0.40 per share of common stock was declared from pre-separation earnings on January 4, 2013 and was recorded as a reduction of additional paid-in capital.
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(d)
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On January 1, 2013, Abbott distributed 1,577 million shares of AbbVie common stock to shareholders of Abbott common stock. For periods prior to the separation, the weighted-average basic and diluted shares outstanding were based on the number of shares of AbbVie common stock outstanding on the distribution date. See Note 4 to the Consolidated Financial Statements for information regarding the calculation of basic and diluted earnings per common share for
2016
,
2015
and
2014
and the
2013
Form 10-K for
2013
and
2012
.
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(e)
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On May 26, 2015, AbbVie acquired Pharmacyclics for approximately $20.8 billion, including cash consideration of $12.4 billion and equity consideration of approximately 128 million shares of AbbVie common stock valued at $8.4 billion. In connection with the acquisition, AbbVie issued $16.7 billion aggregate principal amount of unsecured senior notes, of which approximately $11.5 billion was used to finance the acquisition and approximately $5.0 billion was used to finance an accelerated share repurchase (ASR) program. See Note 5 to the Consolidated Financial Statements for information regarding the acquisition of Pharmacyclics, Note 9 for information on the senior notes and Note 12 for information on the ASR.
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(f)
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In June 2016, AbbVie acquired Stemcentrx for approximately $6.4 billion, including cash consideration of $1.9 billion, equity consideration of approximately 62.4 million shares of AbbVie common stock valued at $3.9 billion and contingent consideration of approximately $620 million. In connection with the acquisition AbbVie issued $7.8 billion aggregate principal amount of unsecured senior notes. Of the $7.7 billion net proceeds, approximately $1.9 billion was used to finance the acquisition, approximately $3.8 billion was used to finance an ASR and approximately $2.0 billion was used to repay the company's outstanding term loan that was due to mature in November 2016. See Note 5 to the Consolidated Financial Statements for information regarding the acquisition of Stemcentrx, Note 9 for information on the senior notes and Note 12 for information on the ASR.
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(g)
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Includes current portion of both long-term debt and lease obligations.
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27
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2016 Form 10-K
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2016 Form 10-K
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28
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•
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HUMIRA sales growth by driving biologic penetration across disease categories, increasing market leadership and strong commercial execution.
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•
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IMBRUVICA revenue growth driven by increasing market share within its five currently approved indications.
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•
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The favorable impact of pipeline products approved in 2016 or currently under regulatory review where approval is expected in 2017. These products are described in greater detail in the section labeled "Research and Development" included as part of this Item 7.
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•
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In May 2016, the European Medicines Agency (EMA) granted approval for HUMIRA for the treatment of pediatric patients aged six years or older, with moderate to severely active Crohn’s disease.
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29
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2016 Form 10-K
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•
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In June 2016, HUMIRA received both U.S. Food and Drug Administration (FDA) and EMA approval to treat adults with non-infectious intermediate, posterior and panuveitis. HUMIRA is now the first and only FDA-approved non-corticosteroid therapy available for adults with non-infectious intermediate, posterior and panuveitis. This approval marks the 10
th
approved indication for HUMIRA in the United States for immune-mediated disease and the 14
th
approved indication in all geographies.
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•
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In November 2016, AbbVie announced that that the Committee for Medicinal Products for Human Use (CHMP) granted a positive opinion for HUMIRA to treat adolescents with hidradenitis suppurativa (HS). If future approval is granted by the European Commission, HUMIRA will be the first and only treatment option for patients aged 12 and older with HS. HUMIRA was approved for adults with moderate to severe HS by the European Commission in July 2015.
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•
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In April 2016, AbbVie acquired all rights to risankizumab (BI 655066), an anti-IL-23 monoclonal biologic antibody in Phase 3 development for psoriasis, from BI pursuant to a global collaboration agreement. AbbVie is also evaluating the potential of this biologic therapy in Crohn’s disease, psoriatic arthritis and asthma. In addition to risankizumab, AbbVie also gained rights to an anti-CD40 antibody, BI 655064, currently in Phase 1 development.
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•
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In November 2016, AbbVie announced that the U.S. Food and Drug Administration (FDA) granted risankizumab orphan drug designation for the treatment of pediatric patients with Crohn's disease.
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•
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AbbVie continued to make progress with ABT-494, the company’s selective JAK-1 inhibitor currently in late-stage development for rheumatoid arthritis. In first quarter of 2016, AbbVie initiated three Phase 3 studies in the registrational program. In the fourth quarter of 2016, the company started a fifth pivotal trial.
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•
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In July 2016, following an evaluation of data for the development of ABT-122, a dual-variable domain (DVD) immunoglobulin targeting TNF and IL-17 in Phase 2 trials for rheumatoid arthritis and psoriatic arthritis, AbbVie determined that further development of ABT-122 will not be pursued. While the trial data demonstrated that the DVD platform worked well, with clear evidence of biologic activity, the decision was based on a lack a differentiation from other candidates in AbbVie’s development pipeline.
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•
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In October 2016, AbbVie opted not to exercise an option to license vobarilizumab, an anti-IL-6R Nanobody, from Ablynx NV based on results of a Phase 2 study in rheumatoid arthritis. AbbVie retains an option to license vobarilizumab based on results of an on-going Phase 2 study in systemic lupus erythematosus.
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•
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In March 2016, AbbVie announced that the FDA approved IMBRUVICA as a first-line treatment for patients with CLL. The approval was based on data from the Phase 3 RESONATE-2 trial, which evaluated efficacy and safety of IMBRUVICA versus traditional chemotherapy, chlorambucil, in treatment-naïve patients with CLL or small lymphocytic leukemia. This is the first FDA-approved chemotherapy-free treatment option for first-line CLL patients. In May 2016, AbbVie announced that the EMA approved IMBRUVICA as a first-line treatment option for adult patients with CLL. IMBRUVICA is now available to treat all lines of CLL in the European Union (EU). This is the fifth treatment indication in the EU for IMBRUVICA.
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•
|
In May 2016, AbbVie announced that the FDA updated the IMBRUVICA Prescribing Information to include new data from two Phase 3 trials supporting expanded use in patients with CLL and small lymphocytic lymphoma. The label now includes overall survival results in previously-untreated CLL/small lymphocytic lymphoma patients from the Phase 3 RESONATE-2 trial. The IMBRUVICA label has also been updated with safety and efficacy data from the Phase 3 HELIOS trial assessing the use of IMBRUVICA in combination with bendamustine and rituximab versus placebo plus rituximab in relapsed/refractory patients with CLL/small lymphocytic lymphoma. Additionally, the FDA approved a new IMBRUVICA indication to include the treatment of patients with small lymphocytic lymphoma with or without the deletion of chromosome 17p.
|
|
|
2016 Form 10-K
|
30
|
•
|
In June 2016, AbbVie announced that the FDA granted IMBRUVICA breakthrough therapy designation for chronic graft-versus-host-disease after failure of one or more lines of systemic therapy, a rare condition with limited treatment options. This is the fourth breakthrough therapy designation for IMBRUVICA.
|
•
|
In January 2017, AbbVie announced that the FDA approved IMBRUVICA for the treatment of patients with relapsed/refractory marginal zone lymphoma (MZL) who require systemic therapy and have received at least one prior anti-CD20-based therapy. This indication is approved under accelerated approval based on overall response rate (ORR) and continued approval may be contingent upon verification and description of clinical benefit in a confirmatory trial. MZL is a slow-growing form of non-Hodgkin's lymphoma. This marks the seventh FDA approval and fifth disease indication for IMBRUVICA since the medication's initial approval in 2013.
|
•
|
In April 2016, the FDA granted accelerated approval of Venclexta (venetoclax) tablets for patients diagnosed with chronic lymphocytic leukemia (CLL) with 17p deletion who have received at least one prior therapy. Additionally, in January 2016, the FDA granted two additional breakthrough therapy designations for venetoclax: (i) in combination with rituximab for the treatment of patients with relapsed/refractory CLL, including patients with chromosome 17p deletion; and (ii) in combination with hypomethylating agents for the treatment of patients with untreated (treatment-naïve) acute myeloid leukemia (AML) who are ineligible to receive standard induction therapy (high-dose chemotherapy). A Phase 3 clinical trial was recently initiated to study the safety and efficacy of venetoclax in combination with azacitidine in treatment naïve elderly subjects with AML who are ineligible for standard induction therapy.
|
•
|
In July 2016, AbbVie announced the initiation of a Phase 3 clinical trial to study the safety and efficacy of venetoclax in combination with bortezomib and dexamethasone in patients with relapsed or refractory multiple myeloma who are considered sensitive or naive to proteasome inhibitors and have received one to three prior lines of therapy. The combination of venetoclax, bortezomib and dexamethasone will be compared to treatment with bortezomib, dexamethasone and placebo.
|
•
|
In December 2016, AbbVie announced that the European Commission (EC) has granted conditional marketing authorization for VENCLYXTO (venetoclax) monotherapy for the treatment of CLL in the presence of 17p deletion or TP53 mutation in adult patients who are unsuitable for or have failed a B-cell receptor pathway inhibitor; and for the treatment of CLL in the absence of 17p deletion or TP53 mutation in adult patients who have failed both chemoimmunotherapy and a B-cell receptor pathway inhibitor. Conditional marketing authorization is granted to medicines that address an unmet medical need, where the benefit of its immediate availability to patients outweighs the risk of limited data availability and where comprehensive data will be provided. VENCLYXTO is a fist-in-class, oral, once-daily medicine that selectively inhibits the function of the BCL-2 protein. VENCLYXTO is being developed by AbbVie and Genentech, a member of the Roche Group. It is jointly commercialized by the companies in the U.S. and by AbbVie outside of the U.S.
|
•
|
In June 2016, AbbVie acquired Stemcentrx and its lead late-stage asset Rova-T currently in registrational trials for small cell lung cancer (SCLC). Rova-T is a novel bio-marker-specific therapy that is derived from cancer stem cells and targets delta-like protein 3 (DLL3) that is expressed in more than 80% of SCLC patient tumors and is not present in healthy tissue. Registrational trials for third-line SCLC are expected to complete enrollment by the end of 2016. AbbVie recently began enrollment of a Phase 1 eight-arm "basket study" in neuroendocrine tumors and a Phase 1/2 regimen selection study as a first-line treatment for SCLC. Beyond Rova-T, Stemcentrx has four novel compounds in clinical trials across several solid tumor indications and has additional pre-clinical compounds.
|
•
|
In July 2016, BMS and AbbVie announced a clinical trial collaboration to evaluate the safety, tolerability and efficacy of Rova-T in combination with BMS’ Opdivo (nivolumab) and Opdivo + Yervoy (ipilimumab) regimen as a treatment for relapsed extensive stage SCLC. The Phase 1/2 clinical program will explore the potential of combining BMS’ immune-oncology agents in conjunction with Rova-T to drive improved and sustained efficacy and tolerability above the current standard of care.
|
•
|
In May 2016, Bristol-Myers Squibb Company (BMS) and AbbVie announced that the EMA approved Empliciti (elotuzumab) for the treatment of multiple myeloma as combination therapy with Revlimid® (lenalidomide) and dexamethasone in adult patients who have received at least one prior therapy. Empliciti is now the first and only immunostimulatory antibody approved for multiple myeloma in the EU.
|
31
|
2016 Form 10-K
|
|
|
•
|
In June 2016, AbbVie exercised its right to end its global collaboration with Infinity Pharmaceuticals, Inc. (Infinity), which it entered into in September 2014 to develop and commercialize duvelisib (IPI-145) for the treatment of patients with cancer. Pursuant to the terms of the global collaboration agreement, the worldwide rights to duvelisib reverted to Infinity.
|
•
|
In February 2016, AbbVie announced that CHMP granted a positive opinion for the use of VIEKIRA (ombitasvir/paritaprevir/ritonavir tablets) + EXVIERA (dasabuvir tablets) without ribavirin (RBV) in chronic HCV infected genotype 1b (GT1b) patients with compensated cirrhosis (Child-Pugh A). In April 2016, AbbVie announced that the FDA approved VIEKIRA PAK (ombitasvir, paritaprevir, ritonavir tablets; dasabuvir tablets) without RBV in patients with GT1b chronic HCV infection and compensated cirrhosis. In July 2016, AbbVie announced that the FDA approved a New Drug Application (NDA) for VIEKIRA XR (dasabuvir, ombitasvir, paritaprevir and ritonavir) extended-release tablets. VIEKIRA XR is a once-daily, extended-release co-formulation of the active ingredients in VIEKIRA PAK (ombitasvir, paritaprevir and ritonavir tablets; dasabuvir tablets) and is for the treatment of patients with chronic genotype 1 (GT1) HCV, including those with compensated cirrhosis (Child-Pugh A).
|
•
|
In October 2016, AbbVie announced that the FDA granted breakthrough therapy designation for the investigational, pan-genotypic regimen of glecaprevir (ABT-493)/pibrentasvir (ABT-530) for the treatment of patients with HCV who failed previous therapy with direct-acting antivirals in genotype 1, including therapy with an NS5A inhibitor and/or protease inhibitor.
|
•
|
In January 2017, AbbVie announced that its marketing authorization application (MAA) has been validated and is now under accelerated assessment by the EMA for the company's investigational, pan-genotypic regimen of G/P for the treatment of all major chronic HCV genotypes. G/P is also intended to address the needs of patients with specific treatment challenges, including those with severe chronic kidney disease (CKD) and those not cured with previous direct-acting antiviral (DAA) treatment. In February 2017, AbbVie announced that the FDA accepted its New Drug Application (NDA) and granted priority review for the company's investigational, pan-genotypic regimen of G/P for the treatment of all major chronic HCV genotypes.
|
•
|
In May 2016, Biogen and AbbVie announced that the FDA approved ZINBRYTA (daclizumab) for the treatment of adult patients with relapsing forms of multiple sclerosis (RMS). ZINBRYTA is a once-monthly, self-administered, subcutaneous injection. Biogen and AbbVie will co-promote ZINBRYTA in the United States. In July 2016, Biogen and AbbVie announced that the EMA granted a marketing authorization for ZINBRYTA for the treatment of adult patients with RMS. ZINBRYTA launched in the third quarter of 2016.
|
•
|
In January 2016, AbbVie announced the initiation of the first of two planned Phase 3 studies evaluating the safety and efficacy of Elagolix in the treatment of patients with uterine fibroids. AbbVie made a milestone payment of $15 million to Neurocrine Biosciences, Inc., AbbVie’s collaboration partner, upon enrollment of the first patient. Elagolix is also in Phase 3 development for endometriosis.
|
|
|
2016 Form 10-K
|
32
|
|
|
|
|
|
|
|
Percent change
|
||||||||||||||||
|
|
|
|
|
|
|
At actual
currency
rates
|
|
At constant
currency
rates
|
||||||||||||||
for the years ended (dollars in millions)
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||
United States
|
$
|
15,947
|
|
|
$
|
13,561
|
|
|
$
|
10,845
|
|
|
17.6
|
%
|
|
25.0
|
%
|
|
17.6
|
%
|
|
25.0
|
%
|
International
|
9,691
|
|
|
9,298
|
|
|
9,115
|
|
|
4.2
|
%
|
|
2.0
|
%
|
|
7.3
|
%
|
|
17.9
|
%
|
|||
Net revenues
|
$
|
25,638
|
|
|
$
|
22,859
|
|
|
$
|
19,960
|
|
|
12.2
|
%
|
|
14.5
|
%
|
|
13.5
|
%
|
|
21.7
|
%
|
33
|
2016 Form 10-K
|
|
|
|
|
|
|
|
|
|
Percent change
|
||||||||||||||||
|
|
|
|
|
|
|
At actual
currency
rates
|
|
At constant
currency
rates
|
||||||||||||||
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||
HUMIRA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
10,432
|
|
|
$
|
8,405
|
|
|
$
|
6,524
|
|
|
24.1
|
%
|
|
28.8
|
%
|
|
24.1
|
%
|
|
28.8
|
%
|
International
|
5,646
|
|
|
5,607
|
|
|
6,019
|
|
|
0.7
|
%
|
|
(6.9
|
)%
|
|
4.3
|
%
|
|
8.6
|
%
|
|||
Total
|
$
|
16,078
|
|
|
$
|
14,012
|
|
|
$
|
12,543
|
|
|
14.7
|
%
|
|
11.7
|
%
|
|
16.1
|
%
|
|
19.1
|
%
|
IMBRUVICA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
1,580
|
|
|
$
|
659
|
|
|
$
|
—
|
|
|
>100.0
|
%
|
|
n/a
|
|
|
>100.0
|
%
|
|
n/a
|
|
Collaboration revenues
|
252
|
|
|
95
|
|
|
—
|
|
|
>100.0
|
%
|
|
n/a
|
|
|
>100.0
|
%
|
|
n/a
|
|
|||
Total
|
$
|
1,832
|
|
|
$
|
754
|
|
|
$
|
—
|
|
|
>100.0
|
%
|
|
n/a
|
|
|
>100.0
|
%
|
|
n/a
|
|
VIEKIRA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
342
|
|
|
$
|
804
|
|
|
$
|
48
|
|
|
(57.4
|
)%
|
|
>100.0
|
%
|
|
(57.4
|
)%
|
|
>100.0
|
%
|
International
|
1,180
|
|
|
835
|
|
|
—
|
|
|
41.3
|
%
|
|
n/a
|
|
|
42.7
|
%
|
|
n/a
|
|
|||
Total
|
$
|
1,522
|
|
|
$
|
1,639
|
|
|
$
|
48
|
|
|
(7.1
|
)%
|
|
>100.0
|
%
|
|
(6.4
|
)%
|
|
>100.0
|
%
|
Lupron
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
663
|
|
|
$
|
653
|
|
|
$
|
580
|
|
|
1.5
|
%
|
|
12.5
|
%
|
|
1.5
|
%
|
|
12.5
|
%
|
International
|
158
|
|
|
173
|
|
|
198
|
|
|
(8.5
|
)%
|
|
(12.9
|
)%
|
|
(5.2
|
)%
|
|
(0.2
|
)%
|
|||
Total
|
$
|
821
|
|
|
$
|
826
|
|
|
$
|
778
|
|
|
(0.6
|
)%
|
|
6.1
|
%
|
|
0.1
|
%
|
|
9.3
|
%
|
Synagis
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
International
|
$
|
730
|
|
|
$
|
740
|
|
|
$
|
835
|
|
|
(1.5
|
)%
|
|
(11.3
|
)%
|
|
(0.4
|
)%
|
|
0.6
|
%
|
Synthroid
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
763
|
|
|
$
|
755
|
|
|
$
|
709
|
|
|
1.1
|
%
|
|
6.4
|
%
|
|
1.1
|
%
|
|
6.4
|
%
|
Creon
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
730
|
|
|
$
|
632
|
|
|
$
|
516
|
|
|
15.5
|
%
|
|
22.5
|
%
|
|
15.5
|
%
|
|
22.5
|
%
|
AndroGel
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
675
|
|
|
$
|
694
|
|
|
$
|
934
|
|
|
(2.8
|
)%
|
|
(25.7
|
)%
|
|
(2.8
|
)%
|
|
(25.7
|
)%
|
Kaletra
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
116
|
|
|
$
|
163
|
|
|
$
|
213
|
|
|
(28.8
|
)%
|
|
(23.8
|
)%
|
|
(28.8
|
)%
|
|
(23.8
|
)%
|
International
|
433
|
|
|
537
|
|
|
657
|
|
|
(19.3
|
)%
|
|
(18.2
|
)%
|
|
(13.3
|
)%
|
|
(4.9
|
)%
|
|||
Total
|
$
|
549
|
|
|
$
|
700
|
|
|
$
|
870
|
|
|
(21.5
|
)%
|
|
(19.6
|
)%
|
|
(16.9
|
)%
|
|
(9.6
|
)%
|
Sevoflurane
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
80
|
|
|
$
|
81
|
|
|
$
|
83
|
|
|
(1.0
|
)%
|
|
(2.5
|
)%
|
|
(1.0
|
)%
|
|
(2.5
|
)%
|
International
|
348
|
|
|
393
|
|
|
467
|
|
|
(11.4
|
)%
|
|
(15.9
|
)%
|
|
(6.9
|
)%
|
|
(4.0
|
)%
|
|||
Total
|
$
|
428
|
|
|
$
|
474
|
|
|
$
|
550
|
|
|
(9.7
|
)%
|
|
(13.9
|
)%
|
|
(6.0
|
)%
|
|
(3.8
|
)%
|
Duodopa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
$
|
37
|
|
|
$
|
12
|
|
|
$
|
—
|
|
|
>100.0
|
%
|
|
>100.0
|
%
|
|
>100.0
|
%
|
|
>100.0
|
%
|
International
|
256
|
|
|
219
|
|
|
220
|
|
|
16.9
|
%
|
|
(0.6
|
)%
|
|
18.1
|
%
|
|
18.1
|
%
|
|||
Total
|
$
|
293
|
|
|
$
|
231
|
|
|
$
|
220
|
|
|
26.9
|
%
|
|
4.8
|
%
|
|
28.1
|
%
|
|
23.5
|
%
|
All other
|
$
|
1,217
|
|
|
$
|
1,402
|
|
|
$
|
1,957
|
|
|
(13.2
|
)%
|
|
(28.3
|
)%
|
|
(12.3
|
)%
|
|
(24.9
|
)%
|
Total net revenues
|
$
|
25,638
|
|
|
$
|
22,859
|
|
|
$
|
19,960
|
|
|
12.2
|
%
|
|
14.5
|
%
|
|
13.5
|
%
|
|
21.7
|
%
|
|
|
2016 Form 10-K
|
34
|
|
|
|
|
|
|
|
Percent
change
|
||||||||||
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
||||||||
Gross margin
|
$
|
19,805
|
|
|
$
|
18,359
|
|
|
$
|
15,534
|
|
|
8
|
%
|
|
18
|
%
|
as a percent of net revenues
|
77
|
%
|
|
80
|
%
|
|
78
|
%
|
|
|
|
|
35
|
2016 Form 10-K
|
|
|
|
|
|
|
|
|
|
Percent
change
|
||||||||||
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
||||||||
Selling, general and administrative
|
$
|
5,855
|
|
|
$
|
6,387
|
|
|
$
|
7,724
|
|
|
(8
|
)%
|
|
(17
|
)%
|
as a percent of net revenues
|
23
|
%
|
|
28
|
%
|
|
39
|
%
|
|
|
|
|
|
|
2016 Form 10-K
|
36
|
|
|
Years Ended December 31,
|
||||||||||
(in millions)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Interest expense
|
|
$
|
1,047
|
|
|
$
|
719
|
|
|
$
|
429
|
|
Interest income
|
|
(82
|
)
|
|
(33
|
)
|
|
(38
|
)
|
|||
Interest expense, net
|
|
$
|
965
|
|
|
$
|
686
|
|
|
$
|
391
|
|
|
|
|
|
|
|
|
||||||
Net foreign exchange loss
|
|
$
|
303
|
|
|
$
|
193
|
|
|
$
|
678
|
|
Other expense (income), net
|
|
232
|
|
|
13
|
|
|
(27
|
)
|
37
|
2016 Form 10-K
|
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows provided by/(used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
7,041
|
|
|
$
|
7,535
|
|
|
$
|
3,549
|
|
Investing activities
|
(6,074
|
)
|
|
(12,936
|
)
|
|
(926
|
)
|
|||
Financing activities
|
(3,928
|
)
|
|
5,752
|
|
|
(3,293
|
)
|
|
|
2016 Form 10-K
|
38
|
39
|
2016 Form 10-K
|
|
|
(in millions)
|
Total
|
|
Less than
one year
|
|
One to
three years
|
|
Three to
five years
|
|
More than
five years
|
||||||||||
Short-term borrowings
|
$
|
377
|
|
|
$
|
377
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term debt and capital lease obligations, including current portion
|
37,077
|
|
|
25
|
|
|
7,503
|
|
|
5,562
|
|
|
23,987
|
|
|||||
Interest on long-term debt
(a)
|
16,924
|
|
|
1,067
|
|
|
2,389
|
|
|
2,295
|
|
|
11,173
|
|
|||||
Future minimum non-cancelable operating lease commitments
|
974
|
|
|
131
|
|
|
222
|
|
|
172
|
|
|
449
|
|
|||||
Purchase obligations and other
(b)
|
1,818
|
|
|
1,669
|
|
|
118
|
|
|
20
|
|
|
11
|
|
|||||
Other long-term liabilities
(c) (d) (e)
|
5,159
|
|
|
540
|
|
|
437
|
|
|
837
|
|
|
3,345
|
|
|||||
Total
|
$
|
62,329
|
|
|
$
|
3,809
|
|
|
$
|
10,669
|
|
|
$
|
8,886
|
|
|
$
|
38,965
|
|
(a)
|
Includes estimated future interest payments on long-term debt securities and capital lease obligations. Interest payments on debt are calculated for future periods using forecasted interest rates in effect at the end of 2016. Projected interest payments include the related effects of interest rate swap agreements. Certain of these projected interest payments may differ in the future based on changes in floating interest rates or other factors or events. The projected interest payments only pertain to obligations and agreements outstanding at
December 31, 2016
. See Note 9 to the Consolidated Financial Statements for additional information regarding the company's debt instruments and Note 10 for additional information on the interest rate agreements outstanding at
December 31, 2016
.
|
(b)
|
Includes the company's significant unconditional purchase obligations. These commitments do not exceed the company's projected requirements and are made in the normal course of business.
|
|
|
2016 Form 10-K
|
40
|
(c)
|
Amounts less than one year includes a voluntary contribution of $150 million AbbVie made to its main domestic defined benefit plan subsequent to December 31,
2016
. Amounts otherwise exclude pension and other post-employment benefits and related deferred compensation cash outflows. Timing of funding is uncertain and dependent on future movements in interest rates and investment returns, changes in laws and regulations and other variables. Also included in this amount are components of other long-term liabilities including restructuring. See Note 8 to the Consolidated Financial Statements for additional information on restructuring and Note 11 for additional information on the pension plan.
|
(d)
|
Excludes liabilities associated with the company's unrecognized tax benefits as it is not possible to reliably estimate the timing of the future cash outflows related to these liabilities. See Note 13 to the Consolidated Financial Statements for additional information on these unrecognized tax benefits.
|
(e)
|
Includes $4.2 billion of contingent consideration liabilities related to the acquisitions of Stemcentrx and BI compounds which are recorded at fair value on the consolidated balance sheet. Potential contingent consideration payments that exceed the fair value recorded on the consolidated balance sheet are not included in the table of contractual obligations. See Notes 5 and 10 to the Consolidated Financial Statements for additional information regarding these liabilities.
|
41
|
2016 Form 10-K
|
|
|
(in millions)
|
Medicaid
and
Medicare
Rebates
|
|
Managed
Care
Rebates
|
|
Wholesaler
Chargebacks
|
||||||
Balance at December 31, 2013
|
$
|
667
|
|
|
$
|
459
|
|
|
$
|
212
|
|
Provisions
|
1,015
|
|
|
970
|
|
|
2,825
|
|
|||
Payments
|
(970
|
)
|
|
(953
|
)
|
|
(2,784
|
)
|
|||
Balance at December 31, 2014
|
712
|
|
|
476
|
|
|
253
|
|
|||
Provisions
|
1,716
|
|
|
2,215
|
|
|
3,866
|
|
|||
Payments
|
(1,396
|
)
|
|
(1,771
|
)
|
|
(3,756
|
)
|
|||
Balance at December 31, 2015
|
1,032
|
|
|
920
|
|
|
363
|
|
|||
Provisions
|
2,606
|
|
|
3,146
|
|
|
3,987
|
|
|||
Payments
|
(2,471
|
)
|
|
(2,899
|
)
|
|
(3,967
|
)
|
|||
Balance at December 31, 2016
|
$
|
1,167
|
|
|
$
|
1,167
|
|
|
$
|
383
|
|
|
|
2016 Form 10-K
|
42
|
|
50 basis point
|
||||||
(in millions) (brackets denote a reduction)
|
Increase
|
|
Decrease
|
||||
Defined benefit plans
|
|
|
|
||||
Service and interest cost
|
$
|
(50
|
)
|
|
$
|
54
|
|
Projected benefit obligation
|
(452
|
)
|
|
511
|
|
||
Other post-employment plans
|
|
|
|
||||
Service and interest cost
|
$
|
(6
|
)
|
|
$
|
7
|
|
Projected benefit obligation
|
(51
|
)
|
|
58
|
|
|
One percentage
point
|
||||||
(in millions) (brackets denote a reduction)
|
Increase
|
|
Decrease
|
||||
Service and interest cost
|
$
|
21
|
|
|
$
|
(17
|
)
|
Projected benefit obligation
|
120
|
|
|
(95
|
)
|
43
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
44
|
|
|
2016
|
|
2015
|
||||||||||||||||||
(in millions)
|
Contract
amount
|
|
Weighted
average
exchange
rate
|
|
Fair and
carrying
value
receivable
|
|
Contract
amount
|
|
Weighted
average
exchange
rate
|
|
Fair and
carrying
value
receivable/
(payable)
|
||||||||||
Receive primarily U.S. dollars in exchange for the following currencies:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Euro
|
$
|
5,544
|
|
|
1.078
|
|
|
$
|
102
|
|
|
$
|
5,880
|
|
|
1.103
|
|
|
$
|
34
|
|
Japanese yen
|
935
|
|
|
111.6
|
|
|
39
|
|
|
853
|
|
|
120.9
|
|
|
(2
|
)
|
||||
British pound
|
611
|
|
|
1.303
|
|
|
35
|
|
|
163
|
|
|
1.496
|
|
|
1
|
|
||||
All other currencies
|
1,693
|
|
|
n/a
|
|
|
11
|
|
|
1,387
|
|
|
n/a
|
|
|
8
|
|
||||
Total
|
$
|
8,783
|
|
|
|
|
$
|
187
|
|
|
$
|
8,283
|
|
|
|
|
$
|
41
|
|
45
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
46
|
|
47
|
2016 Form 10-K
|
|
|
years ended December 31 (in millions, except per share data)
|
2016
|
|
2015
|
|
2014
|
||||||
Net revenues
|
$
|
25,638
|
|
|
$
|
22,859
|
|
|
$
|
19,960
|
|
|
|
|
|
|
|
||||||
Cost of products sold
|
5,833
|
|
|
4,500
|
|
|
4,426
|
|
|||
Selling, general and administrative
|
5,855
|
|
|
6,387
|
|
|
7,724
|
|
|||
Research and development
|
4,366
|
|
|
4,285
|
|
|
3,297
|
|
|||
Acquired in-process research and development
|
200
|
|
|
150
|
|
|
352
|
|
|||
Other expense
|
—
|
|
|
—
|
|
|
750
|
|
|||
Total operating costs and expenses
|
16,254
|
|
|
15,322
|
|
|
16,549
|
|
|||
Operating earnings
|
9,384
|
|
|
7,537
|
|
|
3,411
|
|
|||
|
|
|
|
|
|
||||||
Interest expense, net
|
965
|
|
|
686
|
|
|
391
|
|
|||
Net foreign exchange loss
|
303
|
|
|
193
|
|
|
678
|
|
|||
Other expense (income), net
|
232
|
|
|
13
|
|
|
(27
|
)
|
|||
Earnings before income tax expense
|
7,884
|
|
|
6,645
|
|
|
2,369
|
|
|||
Income tax expense
|
1,931
|
|
|
1,501
|
|
|
595
|
|
|||
Net earnings
|
$
|
5,953
|
|
|
$
|
5,144
|
|
|
$
|
1,774
|
|
|
|
|
|
|
|
||||||
Per share data
|
|
|
|
|
|
||||||
Basic earnings per share
|
$
|
3.65
|
|
|
$
|
3.15
|
|
|
$
|
1.11
|
|
Diluted earnings per share
|
$
|
3.63
|
|
|
$
|
3.13
|
|
|
$
|
1.10
|
|
Cash dividends declared per common share
|
$
|
2.35
|
|
|
$
|
2.10
|
|
|
$
|
1.75
|
|
|
|
|
|
|
|
||||||
Weighted-average basic shares outstanding
|
1,622
|
|
|
1,625
|
|
|
1,595
|
|
|||
Weighted-average diluted shares outstanding
|
1,631
|
|
|
1,637
|
|
|
1,610
|
|
|
|
2016 Form 10-K
|
48
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Net earnings
|
$
|
5,953
|
|
|
$
|
5,144
|
|
|
$
|
1,774
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments, net of tax expense (benefit) of $(31) in 2016, $(139) in 2015 and $(158) in 2014
|
(165
|
)
|
|
(667
|
)
|
|
(1,073
|
)
|
|||
Net investment hedging activities, net of tax expense (benefit) of $79 in 2016, $— in 2015 and $— in 2014
|
140
|
|
|
—
|
|
|
—
|
|
|||
Pension and post-employment benefits, net of tax expense (benefit) of $(75) in 2016, $96 in 2015 and $(351) in 2014
|
(135
|
)
|
|
230
|
|
|
(781
|
)
|
|||
Unrealized gains (losses) on marketable securities, net of tax expense (benefit) of $(11) in 2016, $22 in 2015 and $1 in 2014
|
(1
|
)
|
|
44
|
|
|
1
|
|
|||
Cash flow hedging activities, net of tax expense (benefit) of $18 in 2016, $(6) in 2015 and $8 in 2014
|
136
|
|
|
(137
|
)
|
|
264
|
|
|||
Other comprehensive loss
|
(25
|
)
|
|
(530
|
)
|
|
(1,589
|
)
|
|||
Comprehensive income
|
$
|
5,928
|
|
|
$
|
4,614
|
|
|
$
|
185
|
|
49
|
2016 Form 10-K
|
|
|
as of December 31 (in millions, except share data)
|
2016
|
|
2015
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and equivalents
|
$
|
5,100
|
|
|
$
|
8,399
|
|
Short-term investments
|
1,323
|
|
|
8
|
|
||
Accounts receivable, net
|
4,758
|
|
|
4,730
|
|
||
Inventories
|
1,444
|
|
|
1,719
|
|
||
Prepaid expenses and other
|
3,562
|
|
|
1,458
|
|
||
Total current assets
|
16,187
|
|
|
16,314
|
|
||
|
|
|
|
||||
Investments
|
1,783
|
|
|
145
|
|
||
Property and equipment, net
|
2,604
|
|
|
2,565
|
|
||
Intangible assets, net
|
28,897
|
|
|
19,709
|
|
||
Goodwill
|
15,416
|
|
|
13,168
|
|
||
Other assets
|
1,212
|
|
|
1,149
|
|
||
Total assets
|
$
|
66,099
|
|
|
$
|
53,050
|
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Short-term borrowings
|
$
|
377
|
|
|
$
|
406
|
|
Current portion of long-term debt and lease obligations
|
25
|
|
|
2,025
|
|
||
Accounts payable and accrued liabilities
|
9,379
|
|
|
8,463
|
|
||
Total current liabilities
|
9,781
|
|
|
10,894
|
|
||
|
|
|
|
||||
Long-term debt and lease obligations
|
36,440
|
|
|
29,240
|
|
||
Deferred income taxes
|
6,890
|
|
|
5,276
|
|
||
Other long-term liabilities
|
8,352
|
|
|
3,695
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders’ equity
|
|
|
|
||||
Common stock, $0.01 par value, 4,000,000,000 shares authorized, 1,754,900,486 shares issued as of December 31, 2016 and 1,749,027,140 as of December 31, 2015.
|
18
|
|
|
17
|
|
||
Common stock held in treasury, at cost, 162,387,762 shares as of December 31, 2016 and 139,134,205 shares as of December 31, 2015.
|
(10,852
|
)
|
|
(8,839
|
)
|
||
Additional paid-in-capital
|
13,678
|
|
|
13,080
|
|
||
Retained earnings
|
4,378
|
|
|
2,248
|
|
||
Accumulated other comprehensive loss
|
(2,586
|
)
|
|
(2,561
|
)
|
||
Total stockholders’ equity
|
4,636
|
|
|
3,945
|
|
||
|
|
|
|
||||
Total liabilities and equity
|
$
|
66,099
|
|
|
$
|
53,050
|
|
|
|
2016 Form 10-K
|
50
|
years ended December 31 (in millions)
|
Common
shares
outstanding
|
|
Common
stock
|
|
Treasury
stock
|
|
Additional
paid-in
capital
|
|
Retained
earnings
|
|
Accumulated
other
comprehensive
loss
|
|
Total
|
|||||||||||||
Balance at December 31, 2013
|
1,587
|
|
|
$
|
16
|
|
|
$
|
(320
|
)
|
|
$
|
3,671
|
|
|
$
|
1,567
|
|
|
$
|
(442
|
)
|
|
$
|
4,492
|
|
Net earnings
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,774
|
|
|
—
|
|
|
1,774
|
|
||||||
Other comprehensive loss, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,589
|
)
|
|
(1,589
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,806
|
)
|
|
—
|
|
|
(2,806
|
)
|
||||||
Purchases of treasury stock
|
(9
|
)
|
|
—
|
|
|
(665
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(665
|
)
|
||||||
Stock-based compensation plans and other
|
13
|
|
|
—
|
|
|
13
|
|
|
523
|
|
|
—
|
|
|
—
|
|
|
536
|
|
||||||
Balance at December 31, 2014
|
1,591
|
|
|
16
|
|
|
(972
|
)
|
|
4,194
|
|
|
535
|
|
|
(2,031
|
)
|
|
1,742
|
|
||||||
Net earnings
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,144
|
|
|
—
|
|
|
5,144
|
|
||||||
Other comprehensive loss, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(530
|
)
|
|
(530
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,431
|
)
|
|
—
|
|
|
(3,431
|
)
|
||||||
Common shares issued to Pharmacyclics stockholders
|
128
|
|
|
1
|
|
|
—
|
|
|
8,404
|
|
|
—
|
|
|
—
|
|
|
8,405
|
|
||||||
Purchases of treasury stock
|
(119
|
)
|
|
—
|
|
|
(7,886
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,886
|
)
|
||||||
Stock-based compensation plans and other
|
10
|
|
|
—
|
|
|
19
|
|
|
482
|
|
|
—
|
|
|
—
|
|
|
501
|
|
||||||
Balance at December 31, 2015
|
1,610
|
|
|
17
|
|
|
(8,839
|
)
|
|
13,080
|
|
|
2,248
|
|
|
(2,561
|
)
|
|
3,945
|
|
||||||
Net earnings
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,953
|
|
|
—
|
|
|
5,953
|
|
||||||
Other comprehensive loss, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|
(25
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,823
|
)
|
|
—
|
|
|
(3,823
|
)
|
||||||
Common shares issued to Stemcentrx stockholders
|
63
|
|
|
—
|
|
|
3,958
|
|
|
(35
|
)
|
|
—
|
|
|
—
|
|
|
3,923
|
|
||||||
Purchases of treasury stock
|
(94
|
)
|
|
—
|
|
|
(6,018
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,018
|
)
|
||||||
Stock-based compensation plans and other
|
14
|
|
|
1
|
|
|
47
|
|
|
633
|
|
|
—
|
|
|
—
|
|
|
681
|
|
||||||
Balance at December 31, 2016
|
1,593
|
|
|
$
|
18
|
|
|
$
|
(10,852
|
)
|
|
$
|
13,678
|
|
|
$
|
4,378
|
|
|
$
|
(2,586
|
)
|
|
$
|
4,636
|
|
51
|
2016 Form 10-K
|
|
|
years ended December 31 (in millions) (brackets denote cash outflows)
|
2016
|
|
2015
|
|
2014
|
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
|
||||||
Net earnings
|
$
|
5,953
|
|
|
$
|
5,144
|
|
|
$
|
1,774
|
|
|
Adjustments to reconcile net earnings to net cash from operating activities:
|
|
|
|
|
|
|
||||||
Depreciation
|
425
|
|
|
417
|
|
|
383
|
|
|
|||
Amortization of intangible assets
|
764
|
|
|
419
|
|
|
403
|
|
|
|||
Change in fair value of contingent consideration
|
228
|
|
|
—
|
|
|
—
|
|
|
|||
Stock-based compensation
|
353
|
|
|
282
|
|
|
241
|
|
|
|||
Upfront costs and milestones related to collaborations
|
280
|
|
|
280
|
|
|
1,102
|
|
|
|||
Devaluation loss related to Venezuela
|
298
|
|
|
—
|
|
|
—
|
|
|
|||
Other, net
|
429
|
|
|
489
|
|
|
434
|
|
|
|||
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
|
||||||
Accounts receivable
|
(71
|
)
|
|
(1,076
|
)
|
|
(172
|
)
|
|
|||
Inventories
|
(38
|
)
|
|
(434
|
)
|
|
(203
|
)
|
|
|||
Prepaid expenses and other assets
|
(393
|
)
|
|
511
|
|
|
(220
|
)
|
|
|||
Accounts payable and other liabilities
|
(1,187
|
)
|
|
1,503
|
|
|
(193
|
)
|
|
|||
Cash flows from operating activities
|
7,041
|
|
|
7,535
|
|
|
3,549
|
|
(a)
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from investing activities
|
|
|
|
|
|
|
||||||
Acquisition of businesses, net of cash acquired
|
(2,495
|
)
|
|
(11,488
|
)
|
|
—
|
|
|
|||
Other acquisitions and investments
|
(262
|
)
|
|
(964
|
)
|
|
(622
|
)
|
|
|||
Acquisitions of property and equipment
|
(479
|
)
|
|
(532
|
)
|
|
(612
|
)
|
|
|||
Purchases of investment securities
|
(5,315
|
)
|
|
(851
|
)
|
|
(1,169
|
)
|
|
|||
Sales and maturities of investment securities
|
2,359
|
|
|
899
|
|
|
1,477
|
|
|
|||
Other
|
118
|
|
|
—
|
|
|
—
|
|
|
|||
Cash flows from investing activities
|
(6,074
|
)
|
|
(12,936
|
)
|
|
(926
|
)
|
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from financing activities
|
|
|
|
|
|
|
||||||
Net change in short-term borrowings
|
(29
|
)
|
|
(19
|
)
|
|
12
|
|
|
|||
Proceeds from issuance of long-term debt
|
11,627
|
|
|
20,660
|
|
|
—
|
|
|
|||
Repayments of long-term debt and lease obligations
|
(6,010
|
)
|
|
(4,018
|
)
|
|
(17
|
)
|
|
|||
Debt issuance cost
|
(69
|
)
|
|
(182
|
)
|
|
(141
|
)
|
|
|||
Dividends paid
|
(3,717
|
)
|
|
(3,294
|
)
|
|
(2,661
|
)
|
|
|||
Purchases of treasury stock
|
(6,033
|
)
|
|
(7,586
|
)
|
|
(665
|
)
|
|
|||
Proceeds from the exercise of stock options
|
268
|
|
|
155
|
|
|
232
|
|
|
|||
Other, net
|
35
|
|
|
36
|
|
|
(53
|
)
|
|
|||
Cash flows from financing activities
|
(3,928
|
)
|
|
5,752
|
|
|
(3,293
|
)
|
|
|||
Effect of exchange rate changes on cash and equivalents
|
(338
|
)
|
|
(300
|
)
|
|
(577
|
)
|
|
|||
Net increase (decrease) in cash and equivalents
|
(3,299
|
)
|
|
51
|
|
|
(1,247
|
)
|
|
|||
Cash and equivalents, beginning of year
|
8,399
|
|
|
8,348
|
|
|
9,595
|
|
|
|||
|
|
|
|
|
|
|
||||||
Cash and equivalents, end of year
|
$
|
5,100
|
|
|
$
|
8,399
|
|
|
$
|
8,348
|
|
|
|
|
|
|
|
|
|
||||||
Other supplemental information
|
|
|
|
|
|
|
||||||
Interest paid, net of portion capitalized
|
$
|
986
|
|
|
$
|
536
|
|
|
$
|
419
|
|
|
Income taxes paid
|
3,563
|
|
|
1,108
|
|
|
498
|
|
|
|||
Supplemental schedule of non-cash investing and financing activities
|
|
|
|
|
|
|
||||||
Issuance of common shares associated with acquisitions of businesses
|
3,923
|
|
|
8,405
|
|
|
—
|
|
|
(a)
|
Cash flows from operating activities included the impact of transaction and financing-related and other costs incurred in connection with the terminated proposed combination with Shire plc. See Note 5 for additional information.
|
|
|
2016 Form 10-K
|
52
|
|
|
53
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
54
|
as of December 31 (in millions)
|
2016
|
|
2015
|
||||
Finished goods
|
$
|
223
|
|
|
$
|
469
|
|
Work-in-process
|
1,080
|
|
|
1,081
|
|
||
Raw materials
|
141
|
|
|
169
|
|
||
Inventories
|
$
|
1,444
|
|
|
$
|
1,719
|
|
as of December 31 (in millions)
|
2016
|
|
2015
|
||||
Land
|
$
|
46
|
|
|
$
|
46
|
|
Buildings
|
1,344
|
|
|
1,284
|
|
||
Equipment
|
5,726
|
|
|
5,656
|
|
||
Construction in progress
|
410
|
|
|
348
|
|
||
Property and equipment, gross
|
7,526
|
|
|
7,334
|
|
||
Less accumulated depreciation
|
(4,922
|
)
|
|
(4,769
|
)
|
||
Property and equipment, net
|
$
|
2,604
|
|
|
$
|
2,565
|
|
55
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
56
|
57
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
58
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Interest expense
|
$
|
1,047
|
|
|
$
|
719
|
|
|
$
|
429
|
|
Interest income
|
(82
|
)
|
|
(33
|
)
|
|
(38
|
)
|
|||
Interest expense, net
|
$
|
965
|
|
|
$
|
686
|
|
|
$
|
391
|
|
as of December 31 (in millions)
|
2016
|
|
2015
|
||||
Sales rebates
|
$
|
2,887
|
|
|
$
|
2,355
|
|
Accounts payable
|
1,407
|
|
|
1,597
|
|
||
Dividends payable
|
1,028
|
|
|
924
|
|
||
Salaries, wages and commissions
|
644
|
|
|
632
|
|
||
Royalty and license arrangements
|
434
|
|
|
411
|
|
||
Other
|
2,979
|
|
|
2,544
|
|
||
Accounts payable and accrued liabilities
|
$
|
9,379
|
|
|
$
|
8,463
|
|
as of December 31 (in millions)
|
2016
|
|
2015
|
||||
Contingent consideration
|
$
|
3,941
|
|
|
$
|
—
|
|
Pension and other post-employment benefits
|
2,085
|
|
|
1,949
|
|
||
Liabilities for unrecognized tax benefits
|
1,166
|
|
|
902
|
|
||
Other
|
1,160
|
|
|
844
|
|
||
Other long-term liabilities
|
$
|
8,352
|
|
|
$
|
3,695
|
|
|
59
|
2016 Form 10-K
|
|
|
|
Years ended December 31,
|
||||||||||
(in millions, except per share information)
|
2016
|
|
2015
|
|
2014
|
||||||
Basic EPS
|
|
|
|
|
|
||||||
Net earnings
|
$
|
5,953
|
|
|
$
|
5,144
|
|
|
$
|
1,774
|
|
Earnings allocated to participating securities
|
30
|
|
|
26
|
|
|
9
|
|
|||
Earnings available to common shareholders
|
$
|
5,923
|
|
|
$
|
5,118
|
|
|
$
|
1,765
|
|
Weighted-average basic shares outstanding
|
1,622
|
|
|
1,625
|
|
|
1,595
|
|
|||
Basic earnings per share
|
$
|
3.65
|
|
|
$
|
3.15
|
|
|
$
|
1.11
|
|
|
|
|
|
|
|
||||||
Diluted EPS
|
|
|
|
|
|
||||||
Net earnings
|
$
|
5,953
|
|
|
$
|
5,144
|
|
|
$
|
1,774
|
|
Earnings allocated to participating securities
|
30
|
|
|
26
|
|
|
9
|
|
|||
Earnings available to common shareholders
|
$
|
5,923
|
|
|
$
|
5,118
|
|
|
$
|
1,765
|
|
Weighted-average shares of common stock outstanding
|
1,622
|
|
|
1,625
|
|
|
1,595
|
|
|||
Effect of dilutive securities
|
9
|
|
|
12
|
|
|
15
|
|
|||
Weighted-average diluted shares outstanding
|
1,631
|
|
|
1,637
|
|
|
1,610
|
|
|||
Diluted earnings per share
|
$
|
3.63
|
|
|
$
|
3.13
|
|
|
$
|
1.10
|
|
|
|
|
2016 Form 10-K
|
60
|
61
|
2016 Form 10-K
|
|
|
|
Years ended December 31,
|
||||||
(in millions, except per share information)
|
2016
|
|
2015
|
||||
Net revenues
|
$
|
25,641
|
|
|
$
|
22,869
|
|
Net earnings
|
5,907
|
|
|
4,894
|
|
||
Basic earnings per share
|
$
|
3.58
|
|
|
$
|
2.90
|
|
Diluted earnings per share
|
$
|
3.56
|
|
|
$
|
2.88
|
|
|
|
2016 Form 10-K
|
62
|
63
|
2016 Form 10-K
|
|
|
(in millions)
|
|
||
Assets acquired and liabilities assumed
|
|
|
|
Cash and equivalents
|
$
|
877
|
|
Short-term investments
|
11
|
|
|
Accounts receivable
|
106
|
|
|
Inventories
|
492
|
|
|
Other assets
|
212
|
|
|
Intangible assets
|
|
|
|
Definite-lived developed product rights
|
4,590
|
|
|
Definite-lived license agreements
|
6,780
|
|
|
Indefinite-lived research and development
|
7,180
|
|
|
Accounts payable and accrued liabilities
|
(381
|
)
|
|
Deferred income taxes
|
(6,453
|
)
|
|
Other long-term liabilities
|
(254
|
)
|
|
Total identifiable net assets
|
13,160
|
|
|
Goodwill
|
7,610
|
|
|
Total assets acquired and liabilities assumed
|
$
|
20,770
|
|
|
|
2016 Form 10-K
|
64
|
years ended December 31 (in millions, except per share information)
|
2015
|
|
2014
|
||||
Net revenues
|
$
|
23,215
|
|
|
$
|
20,690
|
|
Net earnings
|
5,345
|
|
|
812
|
|
||
Basic earnings per share
|
$
|
3.18
|
|
|
$
|
0.47
|
|
Diluted earnings per share
|
$
|
3.16
|
|
|
$
|
0.47
|
|
65
|
2016 Form 10-K
|
|
|
|
|
|
2016 Form 10-K
|
66
|
|
|
Twelve months ended December 31,
|
||||||
(in millions)
|
|
2016
|
|
2015
|
||||
Collaboration revenues - International
|
|
$
|
252
|
|
|
$
|
95
|
|
AbbVie profit share costs - United States
|
|
735
|
|
|
306
|
|
||
AbbVie's share of cost sharing expenses
|
|
262
|
|
|
159
|
|
|
(in millions)
|
|
||
Balance as of December 31, 2014
|
$
|
5,862
|
|
Additions (see Note 5)
|
7,610
|
|
|
Foreign currency translation and other adjustments
|
(304
|
)
|
|
Balance as of December 31, 2015
|
13,168
|
|
|
Additions (see Note 5)
|
2,360
|
|
|
Foreign currency translation and other adjustments
|
(112
|
)
|
|
Balance as of December 31, 2016
|
$
|
15,416
|
|
|
2016
|
|
2015
|
||||||||||||||||||||
as of December 31 (in millions)
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net
carrying
amount
|
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net
carrying
amount
|
||||||||||||
Definite-lived intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Developed product rights
|
$
|
16,464
|
|
|
$
|
(4,256
|
)
|
|
$
|
12,208
|
|
|
$
|
9,103
|
|
|
$
|
(3,944
|
)
|
|
$
|
5,159
|
|
License agreements
|
7,809
|
|
|
(1,110
|
)
|
|
6,699
|
|
|
8,000
|
|
|
(1,023
|
)
|
|
6,977
|
|
||||||
Total definite-lived intangible assets
|
24,273
|
|
|
(5,366
|
)
|
|
18,907
|
|
|
17,103
|
|
|
(4,967
|
)
|
|
12,136
|
|
||||||
Indefinite-lived research and development
|
9,990
|
|
|
—
|
|
|
9,990
|
|
|
7,573
|
|
|
—
|
|
|
7,573
|
|
||||||
Total intangible assets, net
|
$
|
34,263
|
|
|
$
|
(5,366
|
)
|
|
$
|
28,897
|
|
|
$
|
24,676
|
|
|
$
|
(4,967
|
)
|
|
$
|
19,709
|
|
67
|
2016 Form 10-K
|
|
|
(in billions)
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
||||||||||
Anticipated annual amortization expense
|
$
|
1.1
|
|
|
$
|
1.3
|
|
|
$
|
1.6
|
|
|
$
|
1.8
|
|
|
$
|
2.0
|
|
|
|
|
2016 Form 10-K
|
68
|
|
as of December 31 (in millions)
|
Effective
interest rate
in 2016
(a)
|
|
2016
|
|
Effective
interest rate
in 2015
(a)
|
|
2015
|
||||||
Senior notes issued in 2012:
|
|
|
|
|
|
|
|
||||||
1.75% notes due 2017
|
1.86
|
%
|
|
$
|
—
|
|
|
1.86
|
%
|
|
$
|
4,000
|
|
2.00% notes due 2018
|
2.15
|
%
|
|
1,000
|
|
|
2.15
|
%
|
|
1,000
|
|
||
2.90% notes due 2022
|
2.97
|
%
|
|
3,100
|
|
|
2.97
|
%
|
|
3,100
|
|
||
4.40% notes due 2042
|
4.46
|
%
|
|
2,600
|
|
|
4.46
|
%
|
|
2,600
|
|
||
Senior notes issued in 2015:
|
|
|
|
|
|
|
|
||||||
1.80% notes due 2018
|
1.92
|
%
|
|
3,000
|
|
|
1.92
|
%
|
|
3,000
|
|
||
2.50% notes due 2020
|
2.65
|
%
|
|
3,750
|
|
|
2.65
|
%
|
|
3,750
|
|
||
3.20% notes due 2022
|
3.28
|
%
|
|
1,000
|
|
|
3.28
|
%
|
|
1,000
|
|
||
3.60% notes due 2025
|
3.66
|
%
|
|
3,750
|
|
|
3.66
|
%
|
|
3,750
|
|
||
4.50% notes due 2035
|
4.58
|
%
|
|
2,500
|
|
|
4.58
|
%
|
|
2,500
|
|
||
4.70% notes due 2045
|
4.73
|
%
|
|
2,700
|
|
|
4.73
|
%
|
|
2,700
|
|
||
Senior notes issued in 2016:
|
|
|
|
|
|
|
|
||||||
2.30% notes due 2021
|
2.40
|
%
|
|
1,800
|
|
|
—
|
%
|
|
—
|
|
||
2.85% notes due 2023
|
2.91
|
%
|
|
1,000
|
|
|
—
|
%
|
|
—
|
|
||
3.20% notes due 2026
|
3.28
|
%
|
|
2,000
|
|
|
—
|
%
|
|
—
|
|
||
4.30% notes due 2036
|
4.37
|
%
|
|
1,000
|
|
|
—
|
%
|
|
—
|
|
||
4.45% notes due 2046
|
4.50
|
%
|
|
2,000
|
|
|
—
|
%
|
|
—
|
|
||
Senior Euro notes issued in 2016:
|
|
|
|
|
|
|
|
||||||
0.38% notes due 2019 (€1,400 principal)
|
0.55
|
%
|
|
1,464
|
|
|
—
|
%
|
|
—
|
|
||
1.38% notes due 2024 (€1,450 principal)
|
1.46
|
%
|
|
1,516
|
|
|
—
|
%
|
|
—
|
|
||
2.13% notes due 2028 (€750 principal)
|
2.18
|
%
|
|
784
|
|
|
—
|
%
|
|
—
|
|
||
Term loan facilities:
|
|
|
|
|
|
|
|
||||||
Floating rate notes due 2016
|
—
|
%
|
|
—
|
|
|
1.23
|
%
|
|
2,000
|
|
||
Floating rate notes due 2018
|
1.64
|
%
|
|
2,000
|
|
|
1.38
|
%
|
|
2,000
|
|
||
Other
|
—
|
%
|
|
113
|
|
|
—
|
%
|
|
139
|
|
||
Fair value hedges
|
—
|
%
|
|
(338
|
)
|
|
—
|
%
|
|
(72
|
)
|
||
Unamortized bond discounts
|
—
|
%
|
|
(110
|
)
|
|
—
|
%
|
|
(85
|
)
|
||
Unamortized deferred financing costs
|
—
|
%
|
|
(164
|
)
|
|
—
|
%
|
|
(117
|
)
|
||
Total long-term debt and lease obligations
|
|
|
36,465
|
|
|
|
|
31,265
|
|
||||
Current portion
|
|
|
25
|
|
|
|
|
2,025
|
|
||||
Noncurrent portion
|
|
|
$
|
36,440
|
|
|
|
|
$
|
29,240
|
|
(a)
|
Excludes the effect of any related interest rate swaps.
|
69
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
70
|
as of and for the years ending December 31 (in millions)
|
Operating
leases
|
|
Debt maturities
and capital leases
|
||||
2017
|
$
|
131
|
|
|
$
|
25
|
|
2018
|
116
|
|
|
6,023
|
|
||
2019
|
106
|
|
|
1,480
|
|
||
2020
|
95
|
|
|
3,760
|
|
||
2021
|
77
|
|
|
1,802
|
|
||
Thereafter
|
449
|
|
|
23,987
|
|
||
Total obligations and commitments
|
974
|
|
|
37,077
|
|
||
Fair value hedges, unamortized bond discounts and deferred financing costs
|
—
|
|
|
(612
|
)
|
||
Total debt and lease obligations
|
$
|
974
|
|
|
$
|
36,465
|
|
|
71
|
2016 Form 10-K
|
|
|
|
Fair value -
Derivatives in asset position
|
|
Fair value -
Derivatives in liability position
|
||||||||||||||||
as of December 31 (in millions)
|
Balance sheet caption
|
2016
|
|
2015
|
|
|
Balance sheet caption
|
2016
|
|
2015
|
|
||||||||
Foreign currency forward exchange contracts-
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Hedging instruments
|
Prepaid expenses and other
|
$
|
170
|
|
|
$
|
33
|
|
|
|
Accounts payable and accrued liabilities
|
$
|
5
|
|
|
$
|
—
|
|
|
Others not designated as hedges
|
Prepaid expenses and other
|
55
|
|
|
28
|
|
|
|
Accounts payable and accrued liabilities
|
33
|
|
|
21
|
|
|
||||
Interest rate swaps designated as fair value hedges
|
Other assets
|
—
|
|
|
9
|
|
|
|
Other long-term liabilities
|
338
|
|
|
81
|
|
|
||||
Total derivatives
|
|
$
|
225
|
|
|
$
|
70
|
|
|
|
|
$
|
376
|
|
|
$
|
102
|
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||||||||
(in millions)
|
|
Cash Flow
Hedges
|
Net Investment Hedges
|
Total
|
|
Cash Flow
Hedges
|
Net Investment Hedges
|
Total
|
|
Cash Flow
Hedges |
Net Investment Hedges
|
Total
|
||||||||||||||||||
Foreign currency forward exchange contracts
|
|
$
|
174
|
|
$
|
118
|
|
$
|
292
|
|
|
$
|
122
|
|
$
|
—
|
|
$
|
122
|
|
|
$
|
193
|
|
$
|
—
|
|
$
|
193
|
|
|
|
2016 Form 10-K
|
72
|
years ended December 31 (in millions)
|
Statement of earnings caption
|
2016
|
|
2015
|
|
2014
|
||||||
Foreign currency forward exchange contracts-
|
|
|
|
|
|
|
||||||
Designated as cash flow hedges
|
Cost of products sold
|
$
|
20
|
|
|
$
|
265
|
|
|
$
|
(79
|
)
|
Not designated as hedges
|
Net foreign exchange loss
|
6
|
|
|
(155
|
)
|
|
(523
|
)
|
|||
Non-designated treasury rate lock agreements
|
Other expense (income), net
|
(12
|
)
|
|
—
|
|
|
—
|
|
|||
Interest rate swaps designated as fair value hedges
|
Interest expense, net
|
(266
|
)
|
|
108
|
|
|
252
|
|
|||
Total
|
|
$
|
(252
|
)
|
|
$
|
218
|
|
|
$
|
(350
|
)
|
•
|
Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets that the company has the ability to access;
|
•
|
Level 2—Valuations based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuations in which all significant inputs are observable in the market; and
|
•
|
Level 3—Valuations using significant inputs that are unobservable in the market and include the use of judgment by the company's management about the assumptions market participants would use in pricing the asset or liability.
|
|
|
|
Basis of fair value measurement
|
||||||||||||
(in millions)
|
Total
|
|
Quoted prices in active markets for
identical assets
(Level 1)
|
|
Significant other
observable
inputs
(Level 2)
|
|
Significant
unobservable
Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash and equivalents
|
$
|
5,100
|
|
|
$
|
1,191
|
|
|
$
|
3,909
|
|
|
$
|
—
|
|
Time deposits
|
1,014
|
|
|
—
|
|
|
1,014
|
|
|
—
|
|
||||
Debt securities
|
1,974
|
|
|
—
|
|
|
1,974
|
|
|
—
|
|
||||
Equity securities
|
76
|
|
|
76
|
|
|
—
|
|
|
—
|
|
||||
Foreign currency contracts
|
225
|
|
|
—
|
|
|
225
|
|
|
—
|
|
||||
Total assets
|
$
|
8,389
|
|
|
$
|
1,267
|
|
|
$
|
7,122
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Interest rate hedges
|
$
|
338
|
|
|
$
|
—
|
|
|
$
|
338
|
|
|
$
|
—
|
|
Foreign currency contracts
|
38
|
|
|
—
|
|
|
38
|
|
|
—
|
|
||||
Contingent consideration
|
4,213
|
|
|
—
|
|
|
—
|
|
|
4,213
|
|
||||
Total liabilities
|
$
|
4,589
|
|
|
$
|
—
|
|
|
$
|
376
|
|
|
$
|
4,213
|
|
73
|
2016 Form 10-K
|
|
|
|
|
|
Basis of fair value measurement
|
||||||||||||
(in millions)
|
Total
|
|
Quoted prices in active markets for
identical assets
(Level 1)
|
|
Significant other
observable
inputs
(Level 2)
|
|
Significant
unobservable
Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash and equivalents
|
$
|
8,399
|
|
|
$
|
798
|
|
|
$
|
7,601
|
|
|
$
|
—
|
|
Time deposits
|
8
|
|
|
—
|
|
|
8
|
|
|
—
|
|
||||
Equity securities
|
111
|
|
|
111
|
|
|
—
|
|
|
—
|
|
||||
Interest rate hedges
|
9
|
|
|
—
|
|
|
9
|
|
|
—
|
|
||||
Foreign currency contracts
|
61
|
|
|
—
|
|
|
61
|
|
|
—
|
|
||||
Total assets
|
$
|
8,588
|
|
|
$
|
909
|
|
|
$
|
7,679
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Interest rate hedges
|
$
|
81
|
|
|
$
|
—
|
|
|
$
|
81
|
|
|
$
|
—
|
|
Foreign currency contracts
|
21
|
|
|
—
|
|
|
21
|
|
|
—
|
|
||||
Total liabilities
|
$
|
102
|
|
|
$
|
—
|
|
|
$
|
102
|
|
|
$
|
—
|
|
|
|
2016 Form 10-K
|
74
|
|
|
|
|
Basis of fair value measurement
|
||||||||||||||
(in millions)
|
Book Value
|
Approximate
fair values
|
|
Quoted prices in active markets for
identical assets
(Level 1)
|
|
Significant other
observable
inputs
(Level 2)
|
|
Significant
unobservable
Inputs
(Level 3)
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||||
Investments
|
$
|
42
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
37
|
|
Total assets
|
$
|
42
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
37
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||||
Short-term borrowings
|
$
|
377
|
|
$
|
377
|
|
|
$
|
—
|
|
|
$
|
377
|
|
|
$
|
—
|
|
Current portion of long-term debt and lease obligations
|
25
|
|
25
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|||||
Long-term debt and lease obligations, excluding fair value hedges
|
36,778
|
|
36,664
|
|
|
34,589
|
|
|
2,075
|
|
|
—
|
|
|||||
Total liabilities
|
$
|
37,180
|
|
$
|
37,066
|
|
|
$
|
34,589
|
|
|
$
|
2,477
|
|
|
$
|
—
|
|
|
|
|
|
Basis of fair value measurement
|
||||||||||||||
(in millions)
|
Book Value
|
Approximate
fair values
|
|
Quoted prices in active markets for
identical assets
(Level 1)
|
|
Significant other
observable
inputs
(Level 2)
|
|
Significant
unobservable
Inputs
(Level 3)
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||||
Investments
|
$
|
34
|
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
37
|
|
Total assets
|
$
|
34
|
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
37
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||||
Short-term borrowings
|
$
|
406
|
|
$
|
406
|
|
|
$
|
—
|
|
|
$
|
406
|
|
|
$
|
—
|
|
Current portion of long-term debt and lease obligations
|
2,025
|
|
2,016
|
|
|
—
|
|
|
2,016
|
|
|
—
|
|
|||||
Long-term debt and lease obligations, excluding fair value hedges
|
29,312
|
|
29,143
|
|
|
27,061
|
|
|
2,082
|
|
|
—
|
|
|||||
Total liabilities
|
$
|
31,743
|
|
$
|
31,565
|
|
|
$
|
27,061
|
|
|
$
|
4,504
|
|
|
$
|
—
|
|
75
|
2016 Form 10-K
|
|
|
|
Amortized Cost
|
|
Gross unrealized
|
|
Fair Value
|
||||||||||
(in millions)
|
|
Gains
|
|
Losses
|
|
||||||||||
Asset backed securities
|
$
|
891
|
|
|
$
|
1
|
|
|
$
|
(4
|
)
|
|
$
|
888
|
|
Corporate debt securities
|
961
|
|
|
1
|
|
|
(2
|
)
|
|
960
|
|
||||
Other debt securities
|
127
|
|
|
—
|
|
|
(1
|
)
|
|
126
|
|
||||
Equity securities
|
18
|
|
|
60
|
|
|
(2
|
)
|
|
76
|
|
||||
Total
|
$
|
1,997
|
|
|
$
|
62
|
|
|
$
|
(9
|
)
|
|
$
|
2,050
|
|
|
|
2016 Form 10-K
|
76
|
|
|
Defined
benefit plans
|
|
Other
post-employment
plans
|
||||||||||||
as of and for the years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Projected benefit obligations
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
$
|
5,387
|
|
|
$
|
5,681
|
|
|
$
|
557
|
|
|
$
|
538
|
|
Service cost
|
210
|
|
|
227
|
|
|
25
|
|
|
25
|
|
||||
Interest cost
|
201
|
|
|
219
|
|
|
24
|
|
|
23
|
|
||||
Employee contributions
|
1
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||
Actuarial loss (gain)
|
313
|
|
|
(467
|
)
|
|
33
|
|
|
(17
|
)
|
||||
Benefits paid
|
(163
|
)
|
|
(158
|
)
|
|
(12
|
)
|
|
(11
|
)
|
||||
Other, primarily foreign currency translation adjustments
|
(120
|
)
|
|
(117
|
)
|
|
—
|
|
|
(1
|
)
|
||||
End of period
|
5,829
|
|
|
5,387
|
|
|
627
|
|
|
557
|
|
||||
Fair value of plan assets
|
|
|
|
|
|
|
|
||||||||
Beginning of period
|
4,174
|
|
|
4,173
|
|
|
—
|
|
|
—
|
|
||||
Actual return (loss) on plan assets
|
383
|
|
|
(25
|
)
|
|
—
|
|
|
—
|
|
||||
Company contributions
|
273
|
|
|
217
|
|
|
12
|
|
|
11
|
|
||||
Employee contributions
|
1
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||
Benefits paid
|
(163
|
)
|
|
(158
|
)
|
|
(12
|
)
|
|
(11
|
)
|
||||
Other, primarily foreign currency translation adjustments
|
(96
|
)
|
|
(35
|
)
|
|
—
|
|
|
—
|
|
||||
End of period
|
4,572
|
|
|
4,174
|
|
|
—
|
|
|
—
|
|
||||
Funded status end of period
|
$
|
(1,257
|
)
|
|
$
|
(1,213
|
)
|
|
$
|
(627
|
)
|
|
$
|
(557
|
)
|
|
|
|
|
|
|
|
|
||||||||
Amounts recognized on the consolidated balance sheets
|
|
|
|
|
|
|
|
||||||||
Other assets
|
$
|
240
|
|
|
$
|
214
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accounts payable and accrued liabilities
|
(25
|
)
|
|
(24
|
)
|
|
(14
|
)
|
|
(11
|
)
|
||||
Other long-term liabilities
|
(1,472
|
)
|
|
(1,403
|
)
|
|
(613
|
)
|
|
(546
|
)
|
||||
Net obligation
|
$
|
(1,257
|
)
|
|
$
|
(1,213
|
)
|
|
$
|
(627
|
)
|
|
$
|
(557
|
)
|
Actuarial loss, net
|
$
|
2,118
|
|
|
$
|
1,939
|
|
|
$
|
179
|
|
|
$
|
154
|
|
Prior service cost (credit)
|
14
|
|
|
16
|
|
|
(37
|
)
|
|
(45
|
)
|
||||
Accumulated other comprehensive loss
|
$
|
2,132
|
|
|
$
|
1,955
|
|
|
$
|
142
|
|
|
$
|
109
|
|
77
|
2016 Form 10-K
|
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Defined benefit plans
|
|
|
|
|
|
||||||
Actuarial loss (gain)
|
$
|
284
|
|
|
$
|
(117
|
)
|
|
$
|
1,127
|
|
Prior service cost
|
—
|
|
|
—
|
|
|
1
|
|
|||
Amortization of actuarial loss and prior service cost
|
(85
|
)
|
|
(127
|
)
|
|
(68
|
)
|
|||
Foreign exchange gain
|
(22
|
)
|
|
(37
|
)
|
|
(41
|
)
|
|||
Total pre-tax loss (gain) recognized in other comprehensive loss
|
$
|
177
|
|
|
$
|
(281
|
)
|
|
$
|
1,019
|
|
Other post-employment plans
|
|
|
|
|
|
||||||
Actuarial loss (gain)
|
$
|
33
|
|
|
$
|
(17
|
)
|
|
$
|
111
|
|
Prior service credit
|
—
|
|
|
—
|
|
|
(13
|
)
|
|||
Amortization of actuarial loss and prior service cost (credit)
|
—
|
|
|
(2
|
)
|
|
3
|
|
|||
Total pre-tax loss (gain) recognized in other comprehensive loss
|
$
|
33
|
|
|
$
|
(19
|
)
|
|
$
|
101
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Defined benefit plans
|
|
|
|
|
|
||||||
Service cost
|
$
|
210
|
|
|
$
|
227
|
|
|
$
|
173
|
|
Interest cost
|
201
|
|
|
219
|
|
|
217
|
|
|||
Expected return on plan assets
|
(354
|
)
|
|
(325
|
)
|
|
(302
|
)
|
|||
Amortization of actuarial loss and prior service cost
|
85
|
|
|
127
|
|
|
68
|
|
|||
Net periodic benefit cost
|
$
|
142
|
|
|
$
|
248
|
|
|
$
|
156
|
|
Other post-employment plans
|
|
|
|
|
|
||||||
Service cost
|
$
|
25
|
|
|
$
|
25
|
|
|
$
|
22
|
|
Interest cost
|
24
|
|
|
23
|
|
|
22
|
|
|||
Amortization of actuarial loss (gain) and prior service cost (credit)
|
—
|
|
|
2
|
|
|
(2
|
)
|
|||
Net periodic benefit cost
|
$
|
49
|
|
|
$
|
50
|
|
|
$
|
42
|
|
|
|
2016 Form 10-K
|
78
|
years ended December 31
|
2016
|
|
2015
|
|
2014
|
|||
Defined benefit plans
|
|
|
|
|
|
|||
Discount rate for determining service cost
|
4.4
|
%
|
|
3.9
|
%
|
|
4.9
|
%
|
Discount rate for determining interest cost
|
4.0
|
%
|
|
3.9
|
%
|
|
4.9
|
%
|
Expected long-term rate of return on plan assets
|
7.9
|
%
|
|
7.8
|
%
|
|
7.9
|
%
|
Expected rate of change in compensation
|
4.4
|
%
|
|
4.4
|
%
|
|
5.0
|
%
|
Other post-employment plans
|
|
|
|
|
|
|||
Discount rate for determining service cost
|
5.1
|
%
|
|
4.5
|
%
|
|
5.3
|
%
|
Discount rate for determining interest cost
|
4.3
|
%
|
|
4.5
|
%
|
|
5.3
|
%
|
79
|
2016 Form 10-K
|
|
|
|
|
|
Basis of fair value measurement
|
||||||||||||
as of December 31 (in millions)
|
2016
|
|
Quoted prices in
active markets for
identical assets
(Level 1)
|
|
Significant other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
Equities
|
|
|
|
|
|
|
|
||||||||
U.S. large cap
(a)
|
$
|
519
|
|
|
$
|
519
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. mid cap
(b)
|
63
|
|
|
63
|
|
|
—
|
|
|
—
|
|
||||
International
(c)
|
97
|
|
|
97
|
|
|
—
|
|
|
—
|
|
||||
Fixed income securities
|
|
|
|
|
|
|
|
||||||||
U.S. government securities
(d)
|
94
|
|
|
—
|
|
|
94
|
|
|
—
|
|
||||
Corporate debt instruments
(d)
|
243
|
|
|
162
|
|
|
81
|
|
|
—
|
|
||||
Non-U.S. government securities
(d)
|
32
|
|
|
30
|
|
|
2
|
|
|
—
|
|
||||
Other
(d)
|
184
|
|
|
179
|
|
|
5
|
|
|
—
|
|
||||
Absolute return funds
(e)
|
228
|
|
|
3
|
|
|
225
|
|
|
—
|
|
||||
Real assets
|
31
|
|
|
31
|
|
|
—
|
|
|
—
|
|
||||
Other
(f)
|
61
|
|
|
61
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
1,552
|
|
|
$
|
1,145
|
|
|
$
|
407
|
|
|
$
|
—
|
|
Total assets measured at NAV
|
3,020
|
|
|
|
|
|
|
|
|||||||
Fair value of plan assets
|
$
|
4,572
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basis of fair value measurement
|
||||||||||||
as of December 31 (in millions)
|
2015
|
|
Quoted prices in
active markets for
identical assets
(Level 1)
|
|
Significant other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
Equities
|
|
|
|
|
|
|
|
||||||||
U.S. large cap
(a)
|
$
|
542
|
|
|
$
|
542
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. mid cap
(b)
|
35
|
|
|
35
|
|
|
—
|
|
|
—
|
|
||||
International
(c)
|
100
|
|
|
100
|
|
|
—
|
|
|
—
|
|
||||
Fixed income securities
|
|
|
|
|
|
|
|
||||||||
U.S. government securities
(d)
|
93
|
|
|
15
|
|
|
78
|
|
|
—
|
|
||||
Corporate debt instruments
(d)
|
203
|
|
|
124
|
|
|
79
|
|
|
—
|
|
||||
Non-U.S. government securities
(d)
|
35
|
|
|
33
|
|
|
2
|
|
|
|
|
||||
Other
(d)
|
126
|
|
|
122
|
|
|
4
|
|
|
—
|
|
||||
Absolute return funds
(e)
|
194
|
|
|
2
|
|
|
192
|
|
|
—
|
|
||||
Real assets
|
8
|
|
|
8
|
|
|
—
|
|
|
—
|
|
||||
Other
(f)
|
93
|
|
|
93
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
1,429
|
|
|
$
|
1,074
|
|
|
$
|
355
|
|
|
$
|
—
|
|
Total assets measured at NAV
|
2,745
|
|
|
|
|
|
|
|
|||||||
Fair value of plan assets
|
$
|
4,174
|
|
|
|
|
|
|
|
|
|
|
(a)
|
A mix of index funds and actively managed equity accounts that are benchmarked to various large cap indices.
|
(b)
|
A mix of index funds and actively managed equity accounts that are benchmarked to various mid cap indices.
|
|
|
2016 Form 10-K
|
80
|
(c)
|
A mix of index funds and actively managed equity accounts that are benchmarked to various non-US equity indices in both developed and emerging markets.
|
(d)
|
Securities held by actively managed accounts, index funds and mutual funds.
|
(e)
|
Funds having global mandates with the flexibility to allocate capital broadly across a wide range of asset classes and strategies, including but not limited to equities, fixed income, commodities, financial futures, currencies and other securities, with objectives to outperform agreed upon benchmarks of specific return and volatility targets.
|
(f)
|
Investments in cash and cash equivalents.
|
years ending December 31 (in millions)
|
Defined
benefit plans
|
|
Other
post-employment
plans
|
||||
2017
|
$
|
174
|
|
|
$
|
14
|
|
2018
|
185
|
|
|
17
|
|
||
2019
|
199
|
|
|
20
|
|
||
2020
|
211
|
|
|
20
|
|
||
2021
|
226
|
|
|
22
|
|
||
2022 to 2026
|
1,351
|
|
|
145
|
|
81
|
2016 Form 10-K
|
|
|
|
|
Years ended December 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Cost of products sold
|
$
|
22
|
|
|
$
|
21
|
|
|
$
|
16
|
|
Research and development
|
193
|
|
|
111
|
|
|
78
|
|
|||
Selling, general and administrative
|
181
|
|
|
150
|
|
|
147
|
|
|||
Pre-tax compensation expense
|
396
|
|
|
282
|
|
|
241
|
|
|||
Tax benefit
|
104
|
|
|
89
|
|
|
73
|
|
|||
After-tax compensation expense
|
$
|
292
|
|
|
$
|
193
|
|
|
$
|
168
|
|
(options in thousands, aggregate intrinsic value in millions)
|
Options
|
|
Weighted-
average
exercise price
|
|
Weighted-
average
remaining
life (in years)
|
|
Aggregate
intrinsic value
|
|||||
Outstanding at December 31, 2015
|
23,569
|
|
|
$
|
30.64
|
|
|
3.0
|
|
$
|
674
|
|
Granted
|
1,143
|
|
|
54.99
|
|
|
|
|
|
|||
Granted in acquisition
|
1,076
|
|
|
12.85
|
|
|
|
|
|
|||
Exercised
|
(9,720
|
)
|
|
26.71
|
|
|
|
|
|
|||
Lapsed
|
(106
|
)
|
|
23.62
|
|
|
|
|
|
|||
Outstanding at December 31, 2016
|
15,962
|
|
|
$
|
33.63
|
|
|
3.7
|
|
$
|
463
|
|
Exercisable at December 31, 2016
|
12,945
|
|
|
$
|
30.76
|
|
|
2.5
|
|
$
|
412
|
|
|
|
2016 Form 10-K
|
82
|
(share units in thousands)
|
Share units
|
|
Weighted-average
grant date fair value
|
|||
Outstanding at December 31, 2015
|
12,490
|
|
|
$
|
51.66
|
|
Granted
|
5,561
|
|
|
55.28
|
|
|
Vested
|
(6,559
|
)
|
|
46.24
|
|
|
Forfeited
|
(777
|
)
|
|
57.00
|
|
|
Outstanding at December 31, 2016
|
10,715
|
|
|
$
|
56.47
|
|
83
|
2016 Form 10-K
|
|
|
2016
|
|
2015
|
||||||||||||
Date Declared
|
|
Payment Date
|
|
Dividend Per Share
|
|
Date Declared
|
|
Payment Date
|
|
Dividend Per Share
|
||||
10/28/16
|
|
02/15/17
|
|
$
|
0.64
|
|
|
10/30/15
|
|
02/16/16
|
|
$
|
0.57
|
|
09/09/16
|
|
11/15/16
|
|
$
|
0.57
|
|
|
09/11/15
|
|
11/16/15
|
|
$
|
0.51
|
|
06/16/16
|
|
08/15/16
|
|
$
|
0.57
|
|
|
06/18/15
|
|
08/14/15
|
|
$
|
0.51
|
|
02/18/16
|
|
05/16/16
|
|
$
|
0.57
|
|
|
02/19/15
|
|
05/15/15
|
|
$
|
0.51
|
|
|
|
2016 Form 10-K
|
84
|
(in millions) (brackets denote losses)
|
Foreign
currency
translation
adjustments
|
|
Net investment hedging
activities
|
|
Pension
and post-
employment
benefits
|
|
Unrealized
gains
(losses) on
marketable
securities
|
|
Cash flow hedging
activities
|
|
Total
|
||||||||||||
Balance as of December 31, 2013
|
$
|
470
|
|
|
$
|
—
|
|
|
$
|
(827
|
)
|
|
$
|
2
|
|
|
$
|
(87
|
)
|
|
$
|
(442
|
)
|
Other comprehensive income (loss) before
reclassifications
|
(1,073
|
)
|
|
—
|
|
|
(827
|
)
|
|
1
|
|
|
187
|
|
|
(1,712
|
)
|
||||||
Net losses reclassified from accumulated other
comprehensive loss
|
—
|
|
|
—
|
|
|
46
|
|
|
—
|
|
|
77
|
|
|
123
|
|
||||||
Net current-period other comprehensive
income (loss)
|
(1,073
|
)
|
|
—
|
|
|
(781
|
)
|
|
1
|
|
|
264
|
|
|
(1,589
|
)
|
||||||
Balance as of December 31, 2014
|
(603
|
)
|
|
—
|
|
|
(1,608
|
)
|
|
3
|
|
|
177
|
|
|
(2,031
|
)
|
||||||
Other comprehensive income (loss) before
reclassifications
|
(667
|
)
|
|
—
|
|
|
147
|
|
|
48
|
|
|
122
|
|
|
(350
|
)
|
||||||
Net losses (gains) reclassified from accumulated other comprehensive loss
|
—
|
|
|
—
|
|
|
83
|
|
|
(4
|
)
|
|
(259
|
)
|
|
(180
|
)
|
||||||
Net current-period other comprehensive
income (loss)
|
(667
|
)
|
|
—
|
|
|
230
|
|
|
44
|
|
|
(137
|
)
|
|
(530
|
)
|
||||||
Balance as of December 31, 2015
|
(1,270
|
)
|
|
—
|
|
|
(1,378
|
)
|
|
47
|
|
|
40
|
|
|
(2,561
|
)
|
||||||
Other comprehensive income (loss) before
reclassifications
|
(165
|
)
|
|
140
|
|
|
(194
|
)
|
|
7
|
|
|
160
|
|
|
(52
|
)
|
||||||
Net losses (gains) reclassified from
accumulated other comprehensive loss
|
—
|
|
|
—
|
|
|
59
|
|
|
(8
|
)
|
|
(24
|
)
|
|
27
|
|
||||||
Net current-period other comprehensive
income (loss)
|
(165
|
)
|
|
140
|
|
|
(135
|
)
|
|
(1
|
)
|
|
136
|
|
|
(25
|
)
|
||||||
Balance as of December 31, 2016
|
$
|
(1,435
|
)
|
|
$
|
140
|
|
|
$
|
(1,513
|
)
|
|
$
|
46
|
|
|
$
|
176
|
|
|
$
|
(2,586
|
)
|
85
|
2016 Form 10-K
|
|
|
years ended December 31 (in millions) (brackets denote gains)
|
2016
|
|
2015
|
|
2014
|
||||||
Pension and post-employment benefits
|
|
|
|
|
|
||||||
Amortization of actuarial losses and other
(a)
|
$
|
85
|
|
|
$
|
129
|
|
|
$
|
65
|
|
Tax benefit
|
(26
|
)
|
|
(46
|
)
|
|
(19
|
)
|
|||
Total reclassifications, net of tax
|
$
|
59
|
|
|
$
|
83
|
|
|
$
|
46
|
|
|
|
|
|
|
|
||||||
Cash flow hedging activities
|
|
|
|
|
|
||||||
Losses (gains) on designated cash flow hedges
(b)
|
$
|
(20
|
)
|
|
$
|
(265
|
)
|
|
$
|
79
|
|
Tax expense (benefit)
|
(4
|
)
|
|
6
|
|
|
(2
|
)
|
|||
Total reclassifications, net of tax
|
$
|
(24
|
)
|
|
$
|
(259
|
)
|
|
$
|
77
|
|
(a)
|
Amounts are included in the computation of net periodic benefit cost (see Note 11).
|
(b)
|
Amounts are included in cost of products sold (see Note 10).
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Domestic
|
$
|
(1,651
|
)
|
|
$
|
(1,038
|
)
|
|
$
|
(3,245
|
)
|
Foreign
|
9,535
|
|
|
7,683
|
|
|
5,614
|
|
|||
Total earnings before income tax expense
|
$
|
7,884
|
|
|
$
|
6,645
|
|
|
$
|
2,369
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Current
|
|
|
|
|
|
||||||
Domestic
|
$
|
2,229
|
|
|
$
|
1,036
|
|
|
$
|
634
|
|
Foreign
|
498
|
|
|
313
|
|
|
341
|
|
|||
Total current taxes
|
$
|
2,727
|
|
|
$
|
1,349
|
|
|
$
|
975
|
|
Deferred
|
|
|
|
|
|
||||||
Domestic
|
$
|
(792
|
)
|
|
$
|
141
|
|
|
$
|
(301
|
)
|
Foreign
|
(4
|
)
|
|
11
|
|
|
(79
|
)
|
|||
Total deferred taxes
|
$
|
(796
|
)
|
|
$
|
152
|
|
|
$
|
(380
|
)
|
Total income tax expense
|
$
|
1,931
|
|
|
$
|
1,501
|
|
|
$
|
595
|
|
|
|
2016 Form 10-K
|
86
|
years ended December 31
|
2016
|
|
2015
|
|
2014
|
|||
Statutory tax rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Effect of foreign operations
|
(10.3
|
)
|
|
(9.4
|
)
|
|
(11.3
|
)
|
U.S. tax credits
|
(4.4
|
)
|
|
(4.5
|
)
|
|
(8.9
|
)
|
Branded prescription drug fee
|
0.5
|
|
|
0.7
|
|
|
3.7
|
|
Tax law change related to foreign currency
|
2.4
|
|
|
—
|
|
|
—
|
|
Valuation allowances
|
—
|
|
|
(1.6
|
)
|
|
3.6
|
|
All other, net
|
1.3
|
|
|
2.4
|
|
|
3.0
|
|
Effective tax rate
|
24.5
|
%
|
|
22.6
|
%
|
|
25.1
|
%
|
87
|
2016 Form 10-K
|
|
|
as of December 31 (in millions)
|
2016
|
|
2015
|
||||
Deferred tax assets
|
|
|
|
||||
Compensation and employee benefits
|
$
|
665
|
|
|
$
|
584
|
|
Accruals and reserves
|
378
|
|
|
368
|
|
||
Chargebacks and rebates
|
473
|
|
|
472
|
|
||
Deferred revenue
|
391
|
|
|
372
|
|
||
Depreciation
|
24
|
|
|
45
|
|
||
Net operating losses and other credit carryforwards
|
151
|
|
|
282
|
|
||
Other
|
71
|
|
|
316
|
|
||
Total deferred tax assets
|
2,153
|
|
|
2,439
|
|
||
Valuation allowances
|
(76
|
)
|
|
(70
|
)
|
||
Total net deferred tax assets
|
2,077
|
|
|
2,369
|
|
||
Deferred tax liabilities
|
|
|
|
||||
Excess of book basis over tax basis of intangible assets
|
(5,375
|
)
|
|
(4,459
|
)
|
||
Excess of book basis over tax basis in investments
|
(3,367
|
)
|
|
(2,958
|
)
|
||
Total deferred tax liabilities
|
(8,742
|
)
|
|
(7,417
|
)
|
||
Net deferred tax liabilities
|
$
|
(6,665
|
)
|
|
$
|
(5,048
|
)
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Balance as of January 1
|
$
|
954
|
|
|
$
|
421
|
|
|
$
|
247
|
|
Increase due to current year tax positions
|
118
|
|
|
187
|
|
|
115
|
|
|||
Increase due to prior year tax positions
|
111
|
|
|
369
|
|
|
67
|
|
|||
Decrease due to prior year tax positions
|
(7
|
)
|
|
(15
|
)
|
|
(6
|
)
|
|||
Lapse of statutes of limitations
|
(8
|
)
|
|
(8
|
)
|
|
(2
|
)
|
|||
Balance as of December 31
|
$
|
1,168
|
|
|
$
|
954
|
|
|
$
|
421
|
|
|
|
2016 Form 10-K
|
88
|
|
89
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
90
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
HUMIRA
|
$
|
16,078
|
|
|
$
|
14,012
|
|
|
$
|
12,543
|
|
IMBRUVICA
|
1,832
|
|
|
754
|
|
|
—
|
|
|||
VIEKIRA
|
1,522
|
|
|
1,639
|
|
|
48
|
|
|||
Lupron
|
821
|
|
|
826
|
|
|
778
|
|
|||
Synagis
|
730
|
|
|
740
|
|
|
835
|
|
|||
Synthroid
|
763
|
|
|
755
|
|
|
709
|
|
|||
Creon
|
730
|
|
|
632
|
|
|
516
|
|
|||
AndroGel
|
675
|
|
|
694
|
|
|
934
|
|
|||
Kaletra
|
549
|
|
|
700
|
|
|
870
|
|
|||
Sevoflurane
|
428
|
|
|
474
|
|
|
550
|
|
|||
Duodopa
|
293
|
|
|
231
|
|
|
220
|
|
|||
All other
|
1,217
|
|
|
1,402
|
|
|
1,957
|
|
|||
Total net revenues
|
$
|
25,638
|
|
|
$
|
22,859
|
|
|
$
|
19,960
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
United States
|
$
|
15,947
|
|
|
$
|
13,561
|
|
|
$
|
10,845
|
|
Germany
|
1,104
|
|
|
1,082
|
|
|
1,035
|
|
|||
United Kingdom
|
776
|
|
|
688
|
|
|
722
|
|
|||
Japan
|
770
|
|
|
599
|
|
|
581
|
|
|||
France
|
713
|
|
|
597
|
|
|
584
|
|
|||
Canada
|
624
|
|
|
551
|
|
|
551
|
|
|||
Spain
|
589
|
|
|
618
|
|
|
534
|
|
|||
Italy
|
523
|
|
|
452
|
|
|
432
|
|
|||
Brazil
|
355
|
|
|
376
|
|
|
435
|
|
|||
The Netherlands
|
352
|
|
|
334
|
|
|
345
|
|
|||
All other countries
|
3,885
|
|
|
4,001
|
|
|
3,896
|
|
|||
Total net revenues
|
$
|
25,638
|
|
|
$
|
22,859
|
|
|
$
|
19,960
|
|
91
|
2016 Form 10-K
|
|
|
years ended December 31 (in millions)
|
2016
|
|
2015
|
||||
United States and Puerto Rico
|
$
|
1,822
|
|
|
$
|
1,868
|
|
Europe
|
504
|
|
|
513
|
|
||
All other
|
278
|
|
|
184
|
|
||
Total long-lived assets
|
$
|
2,604
|
|
|
$
|
2,565
|
|
|
(in millions except per share data)
|
2016
|
|
2015
|
|
||||
First Quarter
|
|
|
|
|
||||
Net revenues
|
$
|
5,958
|
|
|
$
|
5,040
|
|
|
Gross margin
|
4,589
|
|
|
4,098
|
|
|
||
Net earnings
(a)
|
1,354
|
|
|
1,022
|
|
|
||
Basic earnings per share
|
$
|
0.83
|
|
|
$
|
0.64
|
|
|
Diluted earnings per share
|
$
|
0.83
|
|
|
$
|
0.63
|
|
|
Cash dividends declared per common share
|
$
|
0.57
|
|
|
$
|
0.51
|
|
|
Second Quarter
|
|
|
|
|
||||
Net revenues
|
$
|
6,452
|
|
|
$
|
5,475
|
|
|
Gross margin
|
5,047
|
|
|
4,559
|
|
|
||
Net earnings
(b)
|
1,610
|
|
|
1,366
|
|
|
||
Basic earnings per share
|
$
|
0.99
|
|
|
$
|
0.84
|
|
|
Diluted earnings per share
|
$
|
0.98
|
|
|
$
|
0.83
|
|
|
Cash dividends declared per common share
|
$
|
0.57
|
|
|
$
|
0.51
|
|
|
Third Quarter
|
|
|
|
|
||||
Net revenues
|
$
|
6,432
|
|
|
$
|
5,944
|
|
|
Gross margin
|
4,928
|
|
|
4,777
|
|
|
||
Net earnings
(c)
|
1,598
|
|
|
1,239
|
|
|
||
Basic earnings per share
|
$
|
0.97
|
|
|
$
|
0.75
|
|
|
Diluted earnings per share
|
$
|
0.97
|
|
|
$
|
0.74
|
|
|
Cash dividends declared per common share
|
$
|
0.57
|
|
|
$
|
0.51
|
|
|
Fourth Quarter
|
|
|
|
|
||||
Net revenues
|
$
|
6,796
|
|
|
$
|
6,400
|
|
|
Gross margin
|
5,241
|
|
|
4,925
|
|
|
||
Net earnings
(d)
|
1,391
|
|
|
1,517
|
|
|
||
Basic earnings per share
|
$
|
0.86
|
|
|
$
|
0.93
|
|
|
Diluted earnings per share
|
$
|
0.85
|
|
|
$
|
0.92
|
|
|
Cash dividends declared per common share
|
$
|
0.64
|
|
|
$
|
0.57
|
|
|
(a)
|
Results for the first quarter of
2016
included a net foreign exchange loss of
$298 million
relating to the devaluation of AbbVie’s net monetary assets denominated in the Venezuelan bolivar. Results for the first quarter of
2015
included after-tax foreign exchange losses of
$170 million
related to the liquidation in 2015 of remaining foreign currency positions related to the terminated proposed combination with Shire in 2014, a
$100 million
after-tax charge as a
|
|
|
2016 Form 10-K
|
92
|
(b)
|
Second quarter results in
2016
included after-tax costs totaling
$122 million
relating to the acquisition of Stemcentrx and BI compounds as well as the amortization of the acquisition date fair value step-up for inventory related to the acquisition of Pharmacyclics. Second quarter results for
2015
included after-tax costs totaling
$215 million
incurred in connection with the acquisition and integration of Pharmacyclics.
|
(c)
|
Third quarter results in
2016
included after-tax costs totaling
$104 million
relating to the change in fair value of contingent consideration. Results for the third quarter of
2015
included a
$350 million
after-tax charge related to the purchase of a rare pediatric disease PRV from a third party, after after-tax costs totaling
$85 million
incurred in connection with the acquisition and integration of Pharmacyclics and an
$83 million
after-tax charge due to the achievement of a development milestone under the global collaboration with Infinity.
|
(d)
|
Fourth quarter results in
2016
included after-tax costs totaling
$187 million
associated with a tax law change for regulations issued in the fourth quarter of 2016 that revised the treatment of foreign currency translation gains and losses for certain operations and included after-tax costs totaling
$85 million
relating to the change in fair value of contingent consideration. Fourth quarter results for
2015
included after-tax costs totaling
$68 million
incurred in connection with the acquisition and integration of Pharmacyclics and after-tax charges of
$101 million
to increase the company's litigation reserves.
|
93
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
94
|
|
|
95
|
2016 Form 10-K
|
|
|
|
|
2016 Form 10-K
|
96
|
97
|
2016 Form 10-K
|
|
|
|
|
|
2016 Form 10-K
|
98
|
|
|
99
|
2016 Form 10-K
|
|
|
|
(1)
|
Includes 10,761,273 shares issuable under AbbVie's Incentive Stock Program pursuant to awards granted by Abbott and adjusted into AbbVie awards in connection with AbbVie's separation from Abbott.
|
(2)
|
The weighted-average exercise price does not include outstanding restricted stock units and restricted stock awards that have no exercise price.
|
(b)
|
Information Concerning Security Ownership.
Incorporated herein by reference is the material under the heading "Securities Ownership—Securities Ownership of Executive Officers and Directors" in the
2017
Proxy Statement. The
2017
Definitive Proxy Statement will be filed on or about
March 20, 2017
.
|
|
|
|
|
2016 Form 10-K
|
100
|
|
(a)
|
Documents filed as part of this Form 10-K.
|
(1)
|
Financial Statements:
See Item 8, "Financial Statements and Supplementary Data," on page 47 hereof, for a list of financial statements.
|
(2)
|
Financial Statement Schedules:
All schedules omitted are inapplicable or the information required is shown in the consolidated financial statements or notes thereto.
|
(3)
|
Exhibits Required by Item 601 of Regulation S-K:
The information called for by this paragraph is incorporated herein by reference to the Exhibit Index on pages 103 through 105 of this Form 10-K.
|
(b)
|
Exhibits filed:
See Exhibit Index on pages 103 through 105.
|
(c)
|
Financial Statement Schedules:
None applicable.
|
101
|
2016 Form 10-K
|
|
|
AbbVie Inc.
|
||||
By:
|
|
/s/ RICHARD A. GONZALEZ
|
||
|
|
Name:
|
|
Richard A. Gonzalez
|
|
|
Title:
|
|
Chairman of the Board and
Chief Executive Officer
|
Date:
|
February 17, 2017
|
/s/ RICHARD A. GONZALEZ
|
|
/s/ WILLIAM J. CHASE
|
Richard A. Gonzalez
Chairman of the Board and
Chief Executive Officer
(Principal Executive Officer)
|
|
William J. Chase
Executive Vice President,
Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
/s/ THOMAS A. HURWICH
|
|
|
Thomas A. Hurwich
Vice President, Controller
(Principal Accounting Officer)
|
|
|
|
|
|
/s/ ROBERT J. ALPERN, M.D.
|
|
/s/ ROXANNE S. AUSTIN
|
Robert J. Alpern, M.D.
Director of AbbVie Inc.
|
|
Roxanne S. Austin
Director of AbbVie Inc.
|
|
|
|
/s/ WILLIAM H.L. BURNSIDE
|
|
/s/ BRETT J. HART
|
William H.L. Burnside
Director of AbbVie Inc.
|
|
Brett J. Hart
Director of AbbVie Inc.
|
|
|
|
/s/ EDWARD M. LIDDY
|
|
/s/ EDWARD J. RAPP
|
Edward M. Liddy
Director of AbbVie Inc.
|
|
Edward J. Rapp
Director of AbbVie Inc.
|
|
|
|
/s/ GLENN F. TILTON
|
|
/s/ FREDERICK H. WADDELL
|
Glenn F. Tilton
Director of AbbVie Inc.
|
|
Frederick H. Waddell
Director of AbbVie Inc.
|
|
|
2016 Form 10-K
|
102
|
Exhibit
Number
|
|
Exhibit Description
|
|
2.1
|
|
|
*Agreement and Plan of Merger, dated as of April 25, 2016, by and among Stemcentrx, Inc., AbbVie Inc., Sirius Sonoma Corporation, AbbVie Stemcentrx LLC (formerly Sirius Sonoma LLC) and, solely for the purposes set forth therein, Fertile Valley LLC (incorporated by reference to Exhibit 2.1 of AbbVie’s Current Report on Form 8-K/A filed on May 6, 2016).
|
2.2
|
|
|
*Amendment No. 1, dated as of May 28, 2016, to the Agreement and Plan of Merger, dated as of April 25, 2016, by and among Stemcentrx, Inc., AbbVie Inc., Sirius Sonoma Corporation, AbbVie Stemcentrx LLC (formerly Sirius Sonoma LLC) and, solely for the purposes set forth therein, Fertile Valley LLC (incorporated by reference to Exhibit 2.2 of AbbVie’s Current Report on Form 8-K filed on June 1, 2016).
|
2.3
|
|
|
*Agreement and Plan of Reorganization by and among AbbVie Inc., Oxford Amherst Corporation, Oxford Amherst LLC and Pharmacyclics, Inc. dated as of March 4, 2015 (incorporated by reference to Exhibit 2.1 of the company's Current Report on Form 8-K filed on March 6, 2015).
|
2.4
|
|
|
*Amendment No. 1 to Agreement and Plan of Reorganization by and among AbbVie Inc., Oxford Amherst Corporation, Oxford Amherst LLC and Pharmacyclics, Inc. dated as of March 22, 2015 (incorporated by reference to Exhibit 2.1 of the company's Current Report on Form 8-K filed on March 23, 2015).
|
3.1
|
|
|
*Amended and Restated Certificate of Incorporation of AbbVie Inc. (incorporated by reference to Exhibit 3.1 of the company's Current Report on Form 8-K filed on January 2, 2013).
|
3.2
|
|
|
*Amended and Restated By-Laws of AbbVie Inc. (incorporated by reference to Exhibit 3.1 of the company's Current Report on Form 8-K filed on February 22, 2016).
|
4.1
|
|
|
*Indenture dated as of November 8, 2012 between AbbVie Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of Amendment No. 5 to the company's Registration Statement on Form 10 filed on November 16, 2012).
|
4.2
|
|
|
*Supplemental Indenture No. 1 dated as of November 8, 2012 among AbbVie Inc. and U.S. Bank National Association, including forms of notes (incorporated by reference to Exhibit 4.2 of Amendment No. 5 to the company's Registration Statement on Form 10 filed on November 16, 2012).
|
4.3
|
|
|
*Supplemental Indenture No. 2 dated May 14, 2015, between AbbVie Inc. and U.S. Bank National Association, as trustee, including forms of notes (incorporated by reference to Exhibit 4.1 of the company's Current Report on Form 8-K filed on May 14, 2015).
|
4.4
|
|
|
*Supplemental Indenture No. 3 dated May 12, 2016, between AbbVie Inc. and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of AbbVie’s Current Report on Form 8-K filed on May 12, 2016).
|
4.5
|
|
|
*Supplemental Indenture No. 4, dated as of November 17, 2016, among AbbVie Inc., U.S. Bank National Association, as trustee, Elavon Financial Services DAC, U.K. Branch, as paying agent and Elavon Financial Services DAC, as transfer agent and registrar (incorporated by reference to Exhibit 1.1 of the company's Current Report on Form 8-K filed on November 17,2016).
|
4.6
|
|
|
*Agency Agreement, dated as of November 17, 2016, among AbbVie Inc., U.S. Bank National Association, as trustee, Elavon Financial Services DAC, U.K. Branch, as paying agent and Elavon Financial Services DAC, as transfer agent and registrar (incorporated by reference to Exhibit 1.1 of the company's Current Report on Form 8-K filed on November 17,2016).
|
4.7
|
|
|
*Support Agreement by and among AbbVie Inc., Oxford Amherst Corporation and Robert W. Duggan dated as of March 4, 2015 (incorporated by reference to Exhibit 4.1 of the company's Current Report on Form 8-K filed on March 6, 2015).
|
10.1
|
|
|
*Form of Agreement Regarding Change in Control by and between AbbVie Inc. and its named executive officers (incorporated by reference to Exhibit 10.13 of Amendment No. 5 to the Company's Registration Statement on Form 10 filed on November 16, 2012).**
|
10.2
|
|
|
*AbbVie 2013 Incentive Stock Program (incorporated by reference to Exhibit A to the AbbVie Inc. Definitive Proxy Statement on Schedule 14A dated March 15, 2013).**
|
103
|
2016 Form 10-K
|
|
|
Exhibit
Number
|
|
Exhibit Description
|
|
10.3
|
|
|
*AbbVie 2013 Management Incentive Plan (incorporated by reference to Exhibit 10.14 of the company's Annual Report on Form 10-K filed on March 15, 2013).**
|
10.4
|
|
|
*AbbVie Performance Incentive Plan, as amended and restated (incorporated by reference to Exhibit 10.4 of the company's Annual Report on Form 10-K filed on February 19, 2016).**
|
10.5
|
|
|
AbbVie Deferred Compensation Plan, as amended and restated.**
|
10.6
|
|
|
*AbbVie Non-Employee Directors' Fee Plan, as amended and restated (incorporated by reference to Exhibit 10.6 of the company's Annual Report on Form 10-K filed on February 19, 2016).**
|
10.7
|
|
|
AbbVie Supplemental Pension Plan.**
|
10.8
|
|
|
*AbbVie Supplemental Savings Plan, as amended and restated (incorporated by reference to Exhibit 10.8 of the company's Annual Report on Form 10-K filed on February 19, 2016). **
|
10.9
|
|
|
*Form of AbbVie Inc. Non-Employee Director Non-Qualified Stock Option Agreement (incorporated by reference to Exhibit 10.3 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013).**
|
10.10
|
|
|
*Form of AbbVie Inc. Performance Restricted Stock Agreement (CEO/Chairman) (incorporated by reference to Exhibit 10.4 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013).**
|
10.11
|
|
|
*Form of AbbVie Inc. Performance Restricted Stock Agreement (Annual) (incorporated by reference to Exhibit 10.5 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013).**
|
10.12
|
|
|
*Form of AbbVie Inc. Performance Restricted Stock Agreement (Interim) (incorporated by reference to Exhibit 10.6 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013).**
|
10.13
|
|
|
*Form of AbbVie Inc. Non-Qualified Stock Option Agreement (incorporated by reference to Exhibit 10.7 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013).**
|
10.14
|
|
|
*Form of AbbVie Inc. Non-Employee Director Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.15
|
|
|
*Form of AbbVie Inc. Non-Qualified Stock Option Agreement (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.16
|
|
|
*Form of AbbVie Inc. Retention Restricted Stock Unit Agreement - Cliff Vesting (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.17
|
|
|
*Form of AbbVie Inc. Retention Restricted Stock Unit Agreement - Ratable Vesting (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.18
|
|
|
*Form of AbbVie Inc. Retention Restricted Stock Agreement - Cliff Vesting (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.19
|
|
|
*Form of AbbVie Inc. Retention Restricted Stock Agreement - Ratable Vesting (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.20
|
|
|
*Form of AbbVie Inc. Performance Share Award Agreement (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.21
|
|
|
*Form of AbbVie Inc. Performance-Vested Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.1 of the company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016).**
|
10.22
|
|
|
*Stemcentrx 2011 Equity Incentive Plan (incorporated by reference to Exhibit 4.3 of the Company’s Registration Statement on Form S-8 filed on June 16, 2016).**
|
10.23
|
|
|
*Pharmacyclics, Inc. 2014 Equity Incentive Award Plan (incorporated by reference to Exhibit 4.1 of the company's Registration Statement on Form S-8 filed on May 27, 2015).**
|
10.24
|
|
|
*Revolving Credit Agreement, dated as of August 18, 2014, among AbbVie Inc., AbbVie Private Limited, AbbVie Holdings Private Limited, JPMorgan Chase Bank, N.A. and the lenders and other parties party thereto (incorporated by reference to Exhibit 10.2 of the company's Current Report on Form 8-K filed on August 21, 2014).
|
|
|
2016 Form 10-K
|
104
|
Exhibit
Number
|
|
Exhibit Description
|
|
10.25
|
|
|
*Amendment No. 1 to Revolving Credit Agreement, dated as of March 16, 2015, by and among AbbVie Inc., JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders party thereto (incorporated by reference to Exhibit 10.1 of the company's Current Report on Form 8-K filed on March 20, 2015).
|
10.26
|
|
|
*Three-Year Term Loan Agreement, dated as of September 25, 2015, among AbbVie, Bank of America, N.A. and the lenders and other parties party thereto (incorporated by reference to Exhibit 10.1 of the company's Current Report on Form 8-K filed on September 29, 2015).
|
10.27
|
|
|
*364-Day Term Loan Credit Agreement, dated as of September 25, 2015, among AbbVie, Bank of America, N.A. and the lenders and other parties party thereto (incorporated by reference to Exhibit 10.2 of the company's Current Report on Form 8-K filed on September 29, 2015).
|
10.28
|
|
|
*364-Day Bridge Term Loan Credit Agreement, dated as of March 27, 2015, among the company, as borrower, the various financial institutions party thereto, as lenders and Morgan Stanley Senior Funding, Inc., as administrative agent (incorporated by reference to Exhibit 10.1 of the company's Current Report on Form 8-K filed on March 30, 2015).
|
10.29
|
|
|
*Underwriting Agreement, dated as of May 5, 2015, by and among AbbVie Inc. and Morgan Stanley & Co. LLC, Barclays Capital Inc., Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives of the several other underwriters named therein (incorporated by reference to Exhibit 1.1 of the company's Current Report on Form 8-K filed on May 7, 2015).
|
10.30
|
|
|
*Underwriting Agreement, dated as of May 9, 2016, by and among AbbVie Inc., and Barclays Capital Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representatives of the several underwriters named in Schedule II thereto (incorporated by reference to Exhibit 1.1 of AbbVie’s Current Report on Form 8-K filed on May 12, 2016).
|
10.31
|
|
|
*Underwriting Agreement, dated as of November 14, 2016, by and among AbbVie Inc., and Barclays Bank PLC, Deutsche Bank AG, London Branch, J.P. Morgan Securities plc, Merrill Lynch International and Morgan Stanley & Co. International plc, as representatives of the several other underwriters named therein (incorporated by reference to Exhibit 1.1 of the company's Current Report on Form 8-K filed on November 17, 2016).
|
12.1
|
|
|
Ratio of Earnings to Fixed Charges
|
12.2
|
|
|
Computation of Ratio of Earnings to Fixed Charges
|
21
|
|
|
Subsidiaries of AbbVie Inc.
|
23
|
|
|
Consent of Independent Registered Public Accounting Firm.
|
31.1
|
|
|
Certification of Chief Executive Officer Required by Rule 13a-14(a) (17 CFR 240.13a-14(a)).
|
31.2
|
|
|
Certification of Chief Financial Officer Required by Rule 13a-14(a) (17 CFR 240.13a-14(a)).
|
32.1
|
|
|
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
32.2
|
|
|
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101
|
|
|
The following financial statements and notes from the AbbVie Inc. Annual Report on Form 10-K for the year ended December 31, 2016 filed on February 17, 2017, formatted in XBRL: (i) Consolidated Statements of Earnings; (ii) Consolidated Statements of Comprehensive Income; (iii) Consolidated Balance Sheets; (iv) Consolidated Statements of Equity; (v) Consolidated Statements of Cash Flows; and (vi) the Notes to Consolidated Financial Statements.
|
|
|
|
The AbbVie Inc. 2017 Definitive Proxy Statement will be filed with the Securities and Exchange Commission under separate cover on or about March 20, 2017.
|
*
|
Incorporated herein by reference. Commission file number 001-35565.
|
**
|
Denotes management contract or compensatory plan or arrangement required to be filed as an exhibit hereto.
|
105
|
2016 Form 10-K
|
|
|
(a)
|
to the spouse of such person, if any; or
|
(b)
|
to the deceased person’s estate.
|
(a)
|
To make and enforce such rules and regulations as it deems necessary or proper for the efficient administration of the Plan, including the establishment of any claims procedures that may be required by applicable provisions of law;
|
(b)
|
To exercise discretion in interpreting the Plan, any interpretation to be reviewed under the arbitrary and capricious standard;
|
(c)
|
To exercise discretion in deciding all questions concerning the Plan and the eligibility of any person to participate in the Plan; such decision to be reviewed under the arbitrary and capricious standard;
|
(d)
|
To appoint such agents, counsel, accountants, consultants and other persons as may be required to assist in administering the Plan;
|
(e)
|
To allocate and delegate its responsibilities under the Plan and to designate other persons to carry out any of its responsibilities under the Plan, any such allocations, delegation or designation to be in writing;
|
(f)
|
To determine the amount and type of benefits to which any Participant or Beneficiary shall be entitled hereunder, including the method and date for all valuations under the Plan;
|
(g)
|
To receive from the Employers and from Participants such information as shall be necessary for the proper administration of the Plan or any of its programs;
|
(h)
|
To maintain or cause to be maintained all the necessary records for the administration of the Plan;
|
(i)
|
To receive, review and keep on file (as it deems convenient and proper) reports of benefit payments made by the Plan;
|
(j)
|
To determine and allocate among the Employers the liability to the Company associated with Plan benefits in accordance with
Section 1.3
and to determine the time at which and manner in which that liability shall be paid to the Company;
|
(k)
|
To make, or cause to be made, equitable adjustments for any mistakes or errors made in the administration of the Plan; and
|
(l)
|
To do all other acts which the Plan Administrator deems necessary or proper to accomplish and implement its responsibilities under the Plan.
|
(a)
|
“Post-Distribution Participant” means: (i) a Post-Distribution AbbVie Employee (as defined in the EMA) who (A) was an employee of Abbott Laboratories or its subsidiary as of immediately prior to the Separation (as defined in the Separation Agreement) and is transferred to or hired by AbbVie or its Subsidiary after the Separation (as defined in the Separation Agreement) and (B) had liabilities associated with his or her accrued benefits (including any accrued benefits with respect to beneficiaries or alternate payees) in the Abbott SERP transferred to this Plan in accordance with this Supplement A; and (ii) any other individual on whose behalf liabilities are
|
(b)
|
“Transferred Participant” means an AbbVie Employee or an AbbVie LTD Participant (as defined in the EMA), excluding any Post-Distribution AbbVie Employee (as defined in the EMA), who accepts an offer of employment or continues employment with or is transferred to AbbVie Inc. under the EMA on or immediately after the Separation (as defined in the Separation Agreement).
|
|
|
|
|
||||||||
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
Ratio of earnings to fixed charges
|
|
7.4
|
|
8.0
|
|
6.0
|
|
16.6
|
|
41.3
|
|
(in millions, except for ratio)
|
|
Year
ended
December 31, 2016
|
|
|
|
Year
ended
December 31, 2015
|
|
||||
|
|
|
|
|
|
|
|
||||
Determination of earnings:
|
|
|
|
|
|
|
|
||||
Earnings before income tax
|
|
$
|
7,884
|
|
|
|
|
$
|
6,645
|
|
|
Add (deduct):
|
|
|
|
|
|
|
|
||||
Fixed charges
|
|
1,222
|
|
|
|
|
923
|
|
|
||
Interest capitalized during period (a)
|
|
(112
|
)
|
|
|
|
(143
|
)
|
|
||
Total earnings as defined
|
|
$
|
8,994
|
|
|
|
|
$
|
7,425
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed charges:
|
|
|
|
|
|
|
|
||||
Interest expense
|
|
$
|
1,155
|
|
|
|
|
$
|
860
|
|
|
Capitalized interest
|
|
14
|
|
|
|
|
14
|
|
|
||
Rent expense (b)
|
|
53
|
|
|
|
|
49
|
|
|
||
Total fixed charges
|
|
$
|
1,222
|
|
|
|
|
$
|
923
|
|
|
|
|
|
|
|
|
|
|
||||
Ratio of earnings to fixed charges
|
|
7.4
|
|
|
|
|
8.0
|
|
|
Domestic Subsidiaries
|
|
Incorporation
|
|
|
|
AbbVie Biopharmaceuticals LLC
|
|
Delaware
|
|
|
|
AbbVie Bioresearch Center Inc.
|
|
Delaware
|
|
|
|
AbbVie Biotech Ventures Inc.
|
|
Delaware
|
|
|
|
AbbVie Biotherapeutics Inc.
|
|
Delaware
|
|
|
|
AbbVie Endocrine Inc.
|
|
Delaware
|
|
|
|
AbbVie Endocrinology Inc.
|
|
Delaware
|
|
|
|
AbbVie Holdings Inc.
|
|
Delaware
|
|
|
|
AbbVie Pharmaceuticals LLC
|
|
Delaware
|
|
|
|
AbbVie Products LLC
|
|
Georgia
|
|
|
|
AbbVie Purchasing LLC
|
|
Delaware
|
|
|
|
AbbVie Resources Inc.
|
|
Delaware
|
|
|
|
AbbVie Resources International Inc.
|
|
Delaware
|
|
|
|
AbbVie Respiratory LLC
|
|
Delaware
|
|
|
|
AbbVie Stemcentrx LLC
|
|
Delaware
|
|
|
|
AbbVie US Holdings LLC
|
|
Delaware
|
|
|
|
AbbVie US LLC
|
|
Delaware
|
|
|
|
AbbVie Ventures LLC
|
|
Delaware
|
|
|
|
Aeropharm Technology, LLC
|
|
Delaware
|
|
|
|
BioDisplay Technologies, Inc.
|
|
Illinois
|
|
|
|
Fremont Holding L.L.C.
|
|
Delaware
|
|
|
|
IEP Pharmaceutical Devices, LLC
|
|
Delaware
|
|
|
|
Knoll Pharmaceutical Company
|
|
New Jersey
|
|
|
|
KOS Pharmaceuticals, Inc.
|
|
Delaware
|
|
|
|
Life Properties Inc.
|
|
Delaware
|
|
|
|
Organics L.L.C.
|
|
Delaware
|
|
|
|
Pharmacyclics LLC
|
|
Delaware
|
|
|
|
Rowell Laboratories, Inc.
|
|
Minnesota
|
|
|
|
Sapphire Merger Sub, Inc.
|
|
Delaware
|
|
|
|
Unimed Pharmaceuticals, LLC
|
|
Delaware
|
|
|
|
Vernal Holdings Inc.
|
|
Delaware
|
Foreign Subsidiaries
|
|
Incorporation
|
|
|
|
AbbVie S.A.
|
|
Argentina
|
|
|
|
AbbVie Pty Ltd
|
|
Australia
|
|
|
|
AbbVie GmbH
|
|
Austria
|
|
|
|
AbbVie Bahamas Ltd.
|
|
Bahamas
|
|
|
|
AbbVie SA
|
|
Belgium
|
|
|
|
AbbVie Ltd
|
|
Bermuda
|
|
|
|
AbbVie Biotechnology Ltd
|
|
Bermuda
|
|
|
|
AbbVie Holdings Unlimited
|
|
Bermuda
|
|
|
|
AbbVie d.o.o.
|
|
Bosnia
|
|
|
|
AbbVie Farmacêutica Ltda.
|
|
Brazil
|
|
|
|
AbbVie Participações Ltda.
|
|
Brazil
|
|
|
|
AbbVie EOOD
|
|
Bulgaria
|
|
|
|
AbbVie Corporation
|
|
Canada
|
|
|
|
AbbVie Holdings Corporation
|
|
Canada
|
|
|
|
Pharmacyclics Cayman Ltd.
|
|
Cayman Islands
|
|
|
|
Stemcentrx Cayman Ltd.
|
|
Cayman Islands
|
|
|
|
AbbVie Productos Farmacéuticos Limitada
|
|
Chile
|
|
|
|
AbbVie Pharmaceutical Trading (Shanghai) Co., Ltd.
|
|
China
|
|
|
|
Pharmacyclics (Shanghai) Management Consulting Services Limited
|
|
China
|
|
|
|
AbbVie S.A.S.
|
|
Colombia
|
|
|
|
AbbVie d.o.o.
|
|
Croatia
|
|
|
|
AbbVie Limited
|
|
Cyprus
|
|
|
|
AbbVie s.r.o.
|
|
Czech Republic
|
|
|
|
AbbVie A/S
|
|
Denmark
|
|
|
|
AbbVie, S.R.L.
|
|
Dominican Republic
|
|
|
|
AbbVie L.L.C.
|
|
Egypt
|
|
|
|
AbbVie Oy
|
|
Finland
|
|
|
|
AbbVie SAS
|
|
France
|
|
|
|
AbbVie Holdings SAS
|
|
France
|
|
|
|
Abbott Products GmbH
|
|
Germany
|
|
|
|
AbbVie Biotechnology GmbH
|
|
Germany
|
|
|
|
AbbVie Deutschland GmbH & Co. KG
|
|
Germany
|
|
|
|
AbbVie Komplementär GmbH
|
|
Germany
|
|
|
|
AbbVie Real Estate Management GmbH
|
|
Germany
|
|
|
|
AbbVie (Gibraltar) Holdings Limited
|
|
Gibraltar
|
|
|
|
AbbVie (Gibraltar) Limited
|
|
Gibraltar
|
|
|
|
AbbVie Pharmaceuticals Societe Anonyme
|
|
Greece
|
|
|
|
AbbVie, S.A.
|
|
Guatemala
|
AbbVie Limited
|
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Hong Kong
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AbbVie Kft.
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Hungary
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AbbVie Biopharmaceuticals Private Limited
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India
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AbbVie Ireland Holdings Limited
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Ireland
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AbbVie Ireland Unlimited Company
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Ireland
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AbbVie Limited
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Ireland
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AbbVie Manufacturing Management Limited
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Ireland
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Fournier Laboratories Ireland Ltd.
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Ireland
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Pharmacyclics (Europe) Limited
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Ireland
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AbbVie Biopharmaceuticals Ltd.
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Israel
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AbbVie S.r.l.
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Italy
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AbbVie GK
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Japan
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AbbVie Holdings KK
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Japan
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AbbVie Ltd
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Jersey
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AbbVie UK Biopharmaceuticals Ltd
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Jersey
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AbbVie UK Ltd
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Jersey
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AbbVie Ltd
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Korea, South
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AbbVie SIA
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Latvia
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AbbVie UAB
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Lithuania
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AbbVie (Gibraltar) Holdings Limited Luxembourg S.C.S.
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Luxembourg
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AbbVie International S.à r.l.
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Luxembourg
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AbbVie Investments S.à r.l.
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Luxembourg
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AbbVie Overseas S.à r.l.
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Luxembourg
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AbbVie S.à r.l.
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Luxembourg
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AbbVie Sdn. Bhd.
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Malaysia
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AbbVie Farmacéuticos, S.A. de C.V.
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Mexico
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AbbVie B.V.
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Netherlands
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AbbVie Finance B.V.
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Netherlands
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AbbVie Ireland NL B.V.
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Netherlands
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AbbVie Japan Holdings B.V.
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Netherlands
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AbbVie Logistics B.V
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Netherlands
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AbbVie Nederland Holdings B.V.
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Netherlands
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AbbVie Pharmaceuticals B.V.
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Netherlands
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AbbVie Research B.V.
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Netherlands
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AbbVie Venezuela B.V.
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Netherlands
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AbbVie Venezuela Holdings B.V.
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Netherlands
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AbbVie Limited
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New Zealand
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AbbVie AS
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Norway
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AbbVie, S. de R.L.
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Panama
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AbbVie Polska Sp. z o.o.
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Poland
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AbbVie Sp. z o.o.
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Poland
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AbbVie, L.da
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Portugal
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AbbVie Promoção, L.da
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Portugal
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AbbVie Corp
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Puerto Rico
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Knoll LLC
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Puerto Rico
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S.C. AbbVie S.R.L.
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Romania
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AbbVie Limited Liability Company
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Russia
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AbbVie Operations Singapore Pte. Ltd.
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Singapore
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AbbVie Pte. Ltd.
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Singapore
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AbbVie Holdings s.r.o.
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Slovakia
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AbbVie s.r.o.
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Slovakia
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AbbVie d.o.o.
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Slovenia
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AbbVie (Pty) Ltd.
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South Africa
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AbbVie Spain, S.L.
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Spain
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Fundación AbbVie
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Spain
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AbbVie AB
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Sweden
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AbbVie AG
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Switzerland
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AbbVie Biopharmaceuticals GmbH
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Switzerland
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Pharmacyclics Switzerland GmbH
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Switzerland
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AbbVie Ltd.
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Thailand
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AbbVie Sarl
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Tunisia
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AbbVie Tıbbi İlaçlar Sanayi ve Ticaret Limited Şirketi
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Turkey
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AbbVie Australasia Holdings Limited
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United Kingdom
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AbbVie Biotherapeutics Limited
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United Kingdom
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AbbVie Investments Limited
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United Kingdom
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AbbVie Ltd
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United Kingdom
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AbbVie Trustee Company Limited
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United Kingdom
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AbbVie UK Holdco Limited
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United Kingdom
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AbbVie S.A.
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Uruguay
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AbbVie Pharmaceuticals SCA
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Venezuela
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Consent of Independent Registered Public Accounting Firm
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1.
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I have reviewed this annual report on Form 10-K of AbbVie Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of AbbVie as of, and for, the periods presented in this report;
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4.
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AbbVie’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for AbbVie and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to AbbVie, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of AbbVie’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in AbbVie’s internal control over financial reporting that occurred during AbbVie’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, AbbVie’s internal control over financial reporting; and
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5.
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AbbVie’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to AbbVie’s auditors and the audit committee of AbbVie’s board of directors:
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect AbbVie’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in AbbVie’s internal control over financial reporting.
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Date: February 17, 2017
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/s/ Richard A. Gonzalez
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Richard A. Gonzalez, Chairman of the Board
and Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of AbbVie Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of AbbVie as of, and for, the periods presented in this report;
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4.
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AbbVie’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for AbbVie and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to AbbVie, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of AbbVie’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in AbbVie’s internal control over financial reporting that occurred during AbbVie’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, AbbVie’s internal control over financial reporting; and
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5.
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AbbVie’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to AbbVie’s auditors and the audit committee of AbbVie’s board of directors:
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect AbbVie’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in AbbVie’s internal control over financial reporting.
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Date: February 17, 2017
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/s/ William J. Chase
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William J. Chase, Executive Vice President,
Chief Financial Officer
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Richard A. Gonzalez
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Richard A. Gonzalez
Chairman of the Board and
Chief Executive Officer
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ William J. Chase
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William J. Chase
Executive Vice President, Chief Financial Officer
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