Financial Instruments and Fair Value Measures (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2013

Dec. 31, 2012

Financial Instruments and Fair Value Measures

Schedule of amounts and balance sheet location of derivatives

The following table summarizes the amounts and location of AbbVie’s derivative instruments as of March 31, 2013.

	Derivatives in asset position		Derivatives in liability position
(in millions)	Fair value	Balance sheet caption	Fair value	Balance sheet caption
Interest rate swaps designated as fair value hedges	$—	n/a	$121	Long-term liabilities
Foreign currency forward exchange contracts —
Hedging instruments	7	Prepaid expenses and other	—	Accounts payable and accrued liabilities
Others not designated as hedges	14	Prepaid expenses and other	22	Accounts payable and accrued liabilities
Total	$21		$143

The following table summarizes the amounts and location of AbbVie’s derivative instruments as of December 31, 2012.

	Derivatives in asset position		Derivatives in liability position
(in millions)	Fair value	Balance sheet caption	Fair value	Balance sheet caption
Interest rate swaps designated as fair value hedges	$—	n/a	$81	Long-term liabilities
Foreign currency forward exchange contracts —
Hedging instruments	1	Prepaid expenses and other	10	Accounts payable and accrued liabilities
Others not designated as hedges	14	Prepaid expenses and other	15	Accounts payable and accrued liabilities
Total	$15		$106

The following table summarizes the amounts and location of AbbVie’s derivative instruments as of December 31.

	Fair value—assets					Fair value—liabilities
(in millions)	2012		2011		Balance sheet caption	2012		2011		Balance sheet caption
Interest rate swaps designated as fair value hedges	$	—	$	—		$	81	$	—	Long-term liabilities
Foreign currency forward exchange contracts—
Hedging instruments		1		18	Prepaid expenses and other		10		—	Accounts payable and accrued liabilities
Others not designated as hedges		14		21	Prepaid expenses and other		15		43	Accounts payable and accrued liabilities
Total	$	15	$	39		$	106	$	43

Schedule of derivative activity and amounts and locations of income (expense) and gain (loss) reclassified into income

	(Loss) gain recognized in other comprehensive (loss) income		Income (expense) and gain (loss) reclassified into income
(in millions)	2013	2012	2013		2012	Income statement caption
Foreign currency forward exchange contracts —
Designated as cash flow hedges	$9	$10	$—		$2	Cost of products sold
Not designated as hedges	n/a	n/a	(9	)	(10)	Net foreign exchange loss
Interest rate swaps designated as fair value hedges	n/a	n/a	(40	)	n/a	Interest expense, net

	(Loss) gain recognized in other comprehensive (loss) income								Income (expense) and gain (loss) reclassified into income
(in millions)	2012			2011			2010		2012			2011		2010		Income statement caption
Foreign currency forward exchange contracts—
Designated as cash flow hedges	$	(11	)	$	(2	)	$	75	$	24		$	18	$	45	Cost of products sold
Not designated as hedges		n/a			n/a			n/a		(23	)		30		30	Net foreign exchange (gain) loss
Interest rate swaps designated as fair value hedges		n/a			n/a			n/a		(81	)		—		—	Interest expense, net

Summary of the bases used to measure certain assets and liabilities that are carried at fair value on a recurring basis in the consolidated balance sheets

		Basis of fair value measurement
(in millions)	Balance at March 31, 2013	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	$2,808	$510	$2,298	$—
Certificates of deposit	4,371	—	4,371	—
U.S. Treasury securities	300	300	—	—
Equity securities	11	11	—	—
Foreign currency contracts	21	—	21	—
Total assets	$7,511	$821	$6,690	$—
Liabilities
Interest rate hedges	$121	$—	$121	$—
Foreign currency contracts	22	—	22	—
Contingent consideration	118	—	—	118
Total liabilities	$261	$—	$143	$118

		Basis of fair value measurement
(in millions)	Balance at December 31, 2012	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	$5,901	$675	$5,226	$—
Certificates of deposit	1,775	—	1,775	—
U.S. Treasury securities	300	300	—	—
Equity securities	12	12	—	—
Foreign currency contracts	15	—	15	—
Total assets	$8,003	$987	$7,016	$—
Liabilities
Interest rate hedges	$81	$—	$81	$—
Foreign currency contracts	25	—	25	—
Contingent consideration	251	—	—	251
Total liabilities	$357	$—	$106	$251

			Basis of fair value measurement
(in millions)	Balance at December 31, 2012		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	$	5,901	$	675	$	5,226	$	—
Certificates of deposit		1,775		—		1,775		—
U.S. Treasury securities		300		300		—		—
Equity securities		12		12		—		—
Foreign currency forward contracts		15		—		15		—
Total assets	$	8,003	$	987	$	7,016	$	—
Liabilities
Interest rate hedges	$	81	$	—	$	81	$	—
Foreign currency forward contracts		25		—		25		—
Contingent consideration		251		—		—		251
Total liabilities	$	357	$	—	$	106	$	251

			Basis of fair value measurement
(in millions)	Balance at December 31, 2011		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	$	27	$	27	$	—	$	—
U.S. Treasury securities		626		626		—		—
Equity securities		58		58		—		—
Foreign currency forward contracts		39		—		39		—
Total assets	$	750	$	711	$	39	$	—
Liabilities
Foreign currency forward contracts	$	43	$	—	$	43	$	—
Contingent consideration		349		—		—		349
Total liabilities	$	392	$	—	$	43	$	349

Schedule of reconciliation of the fair value measurements that use significant unobservable inputs (Level 3), which consist of contingent payments related to acquisitions

(in millions)
Fair value as of December 31, 2012	$251
Payments	(131)
Other	(5)
Loss recognized in earnings	3
Fair value as of March 31, 2013	$118

(in millions)
Fair value as of December 31, 2010	$	295
Other		(2	)
Loss recognized in earnings		56
Fair value as of December 31, 2011		349
Payments		(134	)
Other		7
Loss recognized in earnings		29
Fair value as of December 31, 2012	$	251

Schedule of the carrying values and fair values of certain financial instruments

	Book values		Approximate fair values
(in millions)	March 31, 2013	December 31, 2012	March 31, 2013	December 31, 2012
Assets
Investments	$107	$107	$105	$104
Liabilities
Short-term borrowings	414	1,020	414	1,020
Current maturities of long-term debt	22	22	22	22
Long-term debt	14,601	14,630	14,902	15,066

	Book values				Approximate fair values
(in millions)	2012		2011		2012		2011
Assets
Investments	$	107	$	171	$	104	$	171
Liabilities
Short-term borrowings		1,020		—		1,020		—
Current maturities of long-term debt and lease obligations		22		16		22		16
Long-term debt and lease obligations		14,630		32		15,066		32

Schedule of fair value of financial instruments by fair value basis

		Basis of fair value measurement
(in millions)	Fair value at March 31, 2013	Quoted prices in active markets for identical assets (Level 1)	Significant other observable inputs (Level 2)	Significant unobservable inputs (Level 3)
Assets
Investments	$105	$—	$33	$72
Total assets	$105	$—	$33	$72
Liabilities
Short-term borrowings	$414	$—	$414	$—
Current maturities of long-term debt and lease obligations	22	—	22	—
Long-term debt and lease obligations	14,902	—	14,902	—
Total liabilities	$15,338	$—	$15,338	$—

		Basis of fair value measurement
(in millions)	Fair value at December 31, 2012	Quoted prices in active markets for identical assets (Level 1)	Significant other observable inputs (Level 2)	Significant unobservable inputs (Level 3)
Assets
Investments	$104	$—	$32	$72
Total assets	$104	$—	$32	$72
Liabilities
Short-term borrowings	$1,020	$—	$1,020	$—
Current maturities of long-term debt and lease obligations	22	—	22	—
Long-term debt and lease obligations	15,066	—	15,066	—
Total liabilities	$16,108	$—	$16,108	$—

			Basis of fair value measurement
(in millions)	Fair value at December 31, 2012		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets
Investments	$	104	$	—	$	32	$	72
Total assets	$	104	$	—	$	32	$	72
Liabilities
Short-term borrowings	$	1,020	$	—	$	1,020	$	—
Current maturities of long-term debt and lease obligations		22		—		22		—
Long-term debt and lease obligations		15,066		—		15,066		—
Total liabilities	$	16,108	$	—	$	16,108	$	—