Segments of Business and Geographic Areas

9 Months Ended

Oct. 03, 2021

Segment Reporting [Abstract]

Segments of Business and Geographic Areas

SEGMENTS OF BUSINESS AND GEOGRAPHIC AREAS

SALES BY SEGMENT OF BUSINESS

	Fiscal Third Quarter Ended					Fiscal Nine Months Ended
(Dollars in Millions)	October 3, 2021		September 27, 2020	Percent Change		October 3, 2021		September 27, 2020	Percent Change
Consumer Health
OTC
U.S.	$	686	601	14.0	%	$	1,960	1,917	2.2	%
International	686		541	26.9		1,894		1,722	10.0
Worldwide	1,372		1,142	20.1		3,854		3,639	5.9
Skin Health/Beauty
U.S.	569		572	(0.5)		1,862		1,767	5.4
International	555		577	(3.8)		1,595		1,506	5.9
Worldwide	1,124		1,149	(2.2)		3,457		3,273	5.6
Oral Care
U.S.	150		164	(8.4)		478		510	(6.2)
International	248		248	0.1		762		694	9.9
Worldwide	398		412	(3.3)		1,240		1,204	3.0
Baby Care
U.S.	95		91	5.2		288		279	3.3
International	296		302	(2.0)		879		831	5.8
Worldwide	391		393	(0.3)		1,167		1,110	5.2
Women's Health
U.S.	3		3	20.1		9		10	(5.7)
International	229		227	0.5		675		654	3.1
Worldwide	232		230	0.8		684		664	3.0
Wound Care/Other
U.S.	122		125	(2.6)		390		370	5.3
International	61		64	(5.2)		186		175	5.8
Worldwide	182		189	(3.5)		575		545	5.4
TOTAL Consumer Health
U.S.	1,625		1,556	4.5		4,987		4,853	2.8
International	2,075		1,958	5.9		5,991		5,582	7.3
Worldwide	3,700		3,514	5.3		10,978		10,435	5.2

PHARMACEUTICAL
Immunology
U.S.	2,771	2,558	8.3	7,932	7,330	8.2
International	1,480	1,230	20.3	4,464	3,619	23.3
Worldwide	4,250	3,789	12.2	12,395	10,950	13.2
REMICADE®
U.S.	480	634	(24.3)	1,508	1,852	(18.6)
U.S. Exports	47	78	(40.2)	197	321	(38.7)
International	234	209	12.2	721	673	7.1
Worldwide	761	921	(17.4)	2,426	2,846	(14.8)
SIMPONI / SIMPONI ARIA®
U.S.	295	312	(5.3)	840	840	0.0
International	276	280	(1.1)	877	827	6.1
Worldwide	571	592	(3.3)	1,717	1,667	3.0
STELARA®
U.S.	1,569	1,313	19.5	4,396	3,668	19.9
International	809	634	27.7	2,404	1,795	33.9
Worldwide	2,378	1,947	22.2	6,800	5,463	24.5
TREMFYA®
U.S.	376	222	69.7	975	650	50.1
International	161	105	52.5	459	316	45.4
Worldwide	537	327	64.1	1,434	965	48.5
OTHER IMMUNOLOGY
U.S.	3	—	*	15	—	*
International	0	3	*	3	9	(68.6)
Worldwide	3	3	(26.4)	18	9	91.6
Infectious Diseases
U.S.	679	413	64.3	1,635	1,265	29.2
International	709	451	57.2	1,788	1,397	28.0
Worldwide	1,389	864	60.6	3,424	2,662	28.6
COVID-19 VACCINE
U.S.	270	—	*	421	—	*
International	233	—	*	346	—	*
Worldwide	502	—	*	766	—	*
EDURANT® / rilpivirine
U.S.	12	11	8.4	31	33	(4.8)
International	247	226	9.7	733	684	7.2
Worldwide	259	236	9.6	764	716	6.7
PREZISTA® / PREZCOBIX® / REZOLSTA® / SYMTUZA®
U.S.	380	379	0.4	1,128	1,154	(2.2)
International	137	147	(7.1)	440	461	(4.6)
Worldwide	517	526	(1.7)	1,568	1,615	(2.9)

OTHER INFECTIOUS DISEASES
U.S.	18	24	(26.0)	55	79	(29.6)
International	93	78	18.3	270	252	6.9
Worldwide	110	102	7.8	325	331	(1.8)
Neuroscience
U.S.	835	759	10.2	2,448	2,285	7.2
International	854	846	0.8	2,770	2,565	8.0
Worldwide	1,689	1,605	5.3	5,218	4,850	7.6
CONCERTA® / methylphenidate
U.S.	35	43	(19.5)	117	150	(22.1)
International	122	107	14.2	372	319	16.4
Worldwide	157	149	4.5	489	469	4.1
INVEGA SUSTENNA® / XEPLION® / INVEGA TRINZA® / TREVICTA®
U.S.	648	585	11.0	1,882	1,704	10.4
International	355	341	4.3	1,111	983	13.0
Worldwide	1,004	926	8.5	2,994	2,688	11.4
RISPERDAL CONSTA®
U.S.	71	70	1.3	210	220	(4.7)
International	69	81	(16.7)	242	254	(5.1)
Worldwide	140	152	(8.4)	452	475	(4.9)
OTHER NEUROSCIENCE
U.S.	81	60	34.7	239	210	13.9
International	307	317	(2.9)	1,045	1,008	3.7
Worldwide	388	377	3.1	1,284	1,218	5.5
Oncology
U.S.	1,525	1,267	20.3	4,364	3,623	20.4
International	2,140	1,862	14.9	6,406	5,310	20.6
Worldwide	3,665	3,129	17.1	10,770	8,933	20.6
DARZALEX®
U.S.	841	585	43.7	2,302	1,540	49.5
International	739	514	43.7	2,076	1,397	48.6
Worldwide	1,580	1,099	43.7	4,378	2,937	49.1
ERLEADA®
U.S.	214	152	40.5	578	407	41.8
International	130	55	*	329	112	*
Worldwide	344	206	66.7	907	519	74.7
IMBRUVICA®
U.S.	413	450	(8.3)	1,311	1,329	(1.3)
International	654	581	12.6	1,996	1,682	18.7
Worldwide	1,066	1,031	3.5	3,307	3,011	9.9
ZYTIGA® / abiraterone acetate
U.S.	25	58	(57.0)	96	284	(66.2)
International	523	532	(1.8)	1,653	1,564	5.7
Worldwide	548	590	(7.2)	1,749	1,848	(5.4)

OTHER ONCOLOGY(1)
U.S.	32	21	49.6	76	63	21.0
International	94	181	(48.0)	352	556	(36.6)
Worldwide	126	203	(37.6)	428	619	(30.7)
Pulmonary Hypertension
U.S.	610	510	19.7	1,778	1,541	15.4
International	258	239	7.9	821	742	10.7
Worldwide	868	749	15.9	2,599	2,283	13.9
OPSUMIT®
U.S.	299	244	22.8	861	729	18.2
International	159	148	7.4	510	458	11.3
Worldwide	458	392	17.0	1,371	1,187	15.5
UPTRAVI®
U.S.	265	226	17.3	792	692	14.6
International	44	34	30.4	135	100	34.6
Worldwide	309	260	19.0	927	792	17.1
OTHER PULMONARY HYPERTENSION
U.S.	47	40	14.4	125	121	2.8
International	54	57	(4.4)	176	183	(3.7)
Worldwide	101	97	3.4	301	304	(1.1)
Cardiovascular / Metabolism / Other
U.S.	800	931	(14.0)	2,379	2,574	(7.6)
International	333	351	(5.1)	1,007	1,052	(4.2)
Worldwide	1,133	1,281	(11.5)	3,386	3,625	(6.6)
XARELTO®
U.S.	636	630	0.8	1,794	1,716	4.5
International	—	—	—	—	—	—
Worldwide	636	630	0.8	1,794	1,716	4.5
INVOKANA® / INVOKAMET®
U.S.	66	156	(57.4)	249	405	(38.4)
International	67	68	(1.0)	194	173	11.9
Worldwide	133	224	(40.3)	443	578	(23.4)
PROCRIT® / EPREX®
U.S.	47	69	(30.9)	168	215	(21.7)
International	65	63	3.1	198	208	(4.7)
Worldwide	112	132	(14.6)	366	423	(13.4)
OTHER
U.S.	51	75	(32.6)	168	238	(29.3)
International	200	219	(8.7)	615	670	(8.3)
Worldwide	251	294	(14.8)	783	908	(13.8)
TOTAL PHARMACEUTICAL
U.S.	7,221	6,438	12.2	20,536	18,619	10.3
International	5,773	4,980	15.9	17,256	14,685	17.5
Worldwide	12,994	11,418	13.8	37,792	33,304	13.5

MEDICAL DEVICES
Interventional Solutions
U.S.	444	399	11.1	1,353	1,019	32.7
International	513	437	17.7	1,599	1,134	41.1
Worldwide	957	836	14.5	2,952	2,153	37.1
Orthopaedics
U.S.	1,249	1,308	(4.5)	3,821	3,427	11.5
International	843	774	8.8	2,611	2,145	21.7
Worldwide	2,093	2,083	0.5	6,433	5,572	15.4
HIPS
U.S.	210	221	(5.3)	654	564	15.9
International	146	124	18.8	451	344	31.3
Worldwide	356	345	3.3	1,105	908	21.8
KNEES
U.S.	184	205	(9.8)	579	527	10.0
International	131	102	28.1	403	298	35.4
Worldwide	316	308	2.8	983	825	19.2
TRAUMA
U.S.	455	433	5.3	1,352	1,194	13.3
International	260	253	2.4	805	698	15.2
Worldwide	715	685	4.2	2,157	1,892	14.0
SPINE, SPORTS & OTHER
U.S.	400	449	(11.1)	1,236	1,142	8.2
International	306	295	3.5	952	805	18.2
Worldwide	705	745	(5.3)	2,187	1,947	12.3
Surgery
U.S.	948	913	3.9	2,881	2,247	28.2
International	1,457	1,239	17.6	4,418	3,556	24.2
Worldwide	2,405	2,152	11.8	7,299	5,803	25.8
ADVANCED
U.S.	440	421	4.6	1,304	1,079	20.9
International	705	579	21.8	2,126	1,644	29.3
Worldwide	1,144	1,000	14.6	3,430	2,723	26.0
GENERAL
U.S.	508	492	3.3	1,577	1,168	35.0
International	752	660	13.9	2,292	1,912	19.9
Worldwide	1,261	1,152	9.4	3,869	3,080	25.6
Vision
U.S.	475	473	0.6	1,414	1,160	21.9
International	714	608	17.4	2,103	1,683	25.0
Worldwide	1,189	1,081	10.1	3,517	2,843	23.7
CONTACT LENSES / OTHER
U.S.	359	375	(4.3)	1,082	924	17.0
International	522	455	14.9	1,525	1,274	19.8
Worldwide	882	830	6.2	2,607	2,198	18.6

SURGICAL
U.S.	117		98	19.6		333		236	41.1
International	191		153	24.7		577		409	41.1
Worldwide	308		251	22.7		910		645	41.1
TOTAL MEDICAL DEVICES
U.S.	3,117		3,092	0.8		9,470		7,852	20.6
International	3,527		3,058	15.4		10,731		8,518	26.0
Worldwide	6,644		6,150	8.0		20,201		16,370	23.4
WORLDWIDE
U.S.	11,963		11,086	7.9		34,993		31,324	11.7
International	11,375		9,996	13.8		33,978		28,785	18.0
Worldwide	$	23,338	21,082	10.7	%	$	68,971	60,109	14.7	%

*Percentage greater than 100% or not meaningful

(1) Inclusive of VELCADE® which was previously disclosed separately

EARNINGS BEFORE PROVISION FOR TAXES BY SEGMENT

	Fiscal Third Quarter Ended				Fiscal Nine Months Ended
(Dollars in Millions)	October 3, 2021		September 27, 2020	Percent Change	October 3, 2021		September 27, 2020	Percent Change
Consumer Health (1)	$	(636)	191	*	$	956	993	(3.7)%
Pharmaceutical(2)	4,259		3,439	23.8	13,838		11,787	17.4
Medical Devices(3)	423		1,010	(58.1)	3,798		2,681	41.7
Segment earnings before provision for taxes	4,046		4,640	(12.8)	18,592		15,461	20.3
Less: Expense not allocated to segments (4)	197		239		652		611
Worldwide income before tax	$	3,849	4,401	(12.5)%	$	17,940	14,850	20.8%

*Percentage greater than 100% or not meaningful

(1) Consumer Health

•Includes intangible amortization expense of $0.1 billion in both the fiscal third quarter of 2021 and 2020 and $0.3 billion in both the fiscal nine months of 2021 and 2020.

•Includes litigation expense of $1.4 billion and $0.5 billion in the fiscal third quarter of 2021 and 2020, respectively. Includes litigation expense of $1.5 billion and $1.2 billion in the fiscal nine months of 2021 and 2020, respectively. Litigation expense in both periods is primarily related to talc.

•Includes a restructuring related charge of $0.1 billion in both the fiscal nine months of 2021 and 2020.

(2) Pharmaceutical

•Includes divestiture gains of $0.6 billion in the fiscal nine months of 2021 related to two brands outside the U.S.

•Includes intangible amortization expense of $0.8 billion in both the fiscal third quarter of 2021 and 2020. Includes intangible amortization expense of $2.5 billion and $2.4 billion in the fiscal nine months of 2021 and 2020, respectively.

•Includes net litigation expense of $0.8 billion and $1.0 billion in the fiscal third quarter of 2021 and 2020, respectively. Includes net litigation expense of $0.7 billion and $1.0 billion in the fiscal nine months of 2021 and 2020, respectively. Litigation expense in 2021 is primarily related to Risperdal. Litigation expense in 2020 is related to the opioid settlement.

•Includes a gain on securities of $0.1 billion in the fiscal third quarter of 2021 and $0.2 billion in both the fiscal nine months of 2021 and 2020, respectively.

•Includes a restructuring related charge of $0.1 billion in both the fiscal nine months of 2021 and 2020, respectively.

In fiscal 2020 and 2021, the Company entered into a series of contract manufacturing arrangements for vaccine production with third party contract manufacturing organizations. These arrangements provide the Company with future supplemental commercial capacity for vaccine production and potentially transferable rights to such production if capacity is not required. Amounts paid for services to be delivered and contractually obligated to be paid to these contract manufacturing organizations of approximately $1.2 billion are reflected in the prepaid expenses and other, other assets, accrued liabilities and other liabilities

accounts in the Company's consolidated balance sheet upon execution of each agreement. Additionally, the Company has entered into certain vaccine development cost sharing arrangements with government related organizations.

(3) Medical Devices

•Includes a contingent consideration reversal of $0.2 billion in the fiscal third quarter of 2020 and $1.1 billion in the fiscal nine months of 2020 related to the timing of certain developmental milestones associated with the Auris Health acquisition.

•Includes a restructuring related charge of $0.1 billion in both the fiscal third quarter of 2021 and 2020, respectively. Includes a restructuring related charge of $0.2 billion in both the fiscal nine months of 2021 and 2020, respectively.

•Includes intangible amortization expense of $0.3 billion and $0.2 billion in the fiscal third quarter of 2021 and 2020, respectively. Includes intangible amortization expense of $0.8 billion and $0.7 billion in the fiscal nine months of 2021 and 2020, respectively.

•Includes a gain on securities of $0.1 billion in the fiscal nine months of 2021.

•Includes an in-process research and development expense of $0.9 billion related to the general surgery offering in digital robotics (Ottava) acquired with the Auris Health acquisition in 2019 in both the fiscal third quarter and fiscal nine months of 2021. See Note 3 to the Consolidated Financial Statements for more details.

(4) Amounts not allocated to segments include interest income/expense and general corporate income/expense.

SALES BY GEOGRAPHIC AREA

	Fiscal Third Quarter Ended					Fiscal Nine Months Ended
(Dollars in Millions)	October 3, 2021		September 27, 2020	Percent Change		October 3, 2021		September 27, 2020	Percent Change
United States	$	11,963	11,086	7.9	%	$	34,993	31,324	11.7	%
Europe	5,587		4,819	15.9		16,669		13,709	21.6
Western Hemisphere, excluding U.S.	1,500		1,296	15.7		4,291		3,931	9.2
Asia-Pacific, Africa	4,288		3,881	10.5		13,018		11,145	16.8
Total	$	23,338	21,082	10.7	%	$	68,971	60,109	14.7	%