Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2017

Derivative [Line Items]

Schedule of Derivative Instruments [Table Text Block]

The following table presents the contractual amounts of our derivative instruments outstanding:

(in millions)	Topic 815 designation	As of
		September 30, 2017		December 31, 2016
Forward currency contracts	Cash flow hedge	$	3,218	$	2,271
Forward currency contracts	Non-designated	2,111		1,830
Total Notional Outstanding		$	5,329	$	4,101

Gains (losses) recognized in earnings for derivatives designed as hedging instruments

As of September 30, 2017, pre-tax net gains or losses for our derivative instruments designated, or previously designated, as currency hedge contracts under FASB ASC Topic 815 that may be reclassified to earnings within the next twelve months are presented below:

(in millions)	Location in Unaudited Condensed Consolidated Statements of Operations	Amount of Pre-Tax Gain (Loss) that may be Reclassified to Earnings
Fair value hedge contracts	Interest expense	$	12
Cash flow hedge contracts	Interest expense	1
Cash flow hedge contracts	Cost of products sold	(30		)

The following presents the effect of our derivative instruments designated as cash flow hedges under FASB ASC Topic 815 on our accompanying unaudited condensed consolidated statements of operations:

(in millions)	Location in Unaudited Condensed Consolidated Statements of Operations	Effective Amount Recognized in OCI								Effective Amount Reclassified from OCI into Earnings
		Pre-Tax Gain (Loss)			Tax Benefit (Expense)		Gain (Loss) Net of Tax			Pre-Tax (Gain) Loss			Tax Benefit (Expense)		(Gain) Loss Net of Tax
Three Months Ended September 30, 2017
Forward currency contracts	Cost of products sold	$	(24	)	$	9	$	(15	)	$	(14	)	$	5	$	(9	)
Three Months Ended September 30, 2016
Forward currency contracts	Cost of products sold	$	(22	)	$	8	$	(14	)	$	(27	)	$	10	$	(17	)
Nine Months Ended September 30, 2017
Forward currency contracts	Cost of products sold	$	(88	)	$	32	$	(56	)	$	(68	)	$	25	$	(43	)
Interest rate derivative contracts	Interest expense	—			—		—			(1		)	—		(1		)
		$	(88	)	$	32	$	(56	)	$	(69	)	$	25	$	(44	)
Nine Months Ended September 30, 2016
Forward currency contracts	Cost of products sold	$	(180	)	$	65	$	(115	)	$	(107	)	$	38	$	(69	)

Net foreign currency gain (loss) [Table Text Block]

Net gains and losses on currency hedge contracts not designated as hedging instruments offset by net gains and losses from currency transaction exposures are presented below:

(in millions)	Location in Unaudited Condensed Consolidated Statements of Operations
		Three Months Ended						Nine Months Ended
		September 30,						September 30,
		2017			2016			2017			2016
Net gain (loss) on currency hedge contracts	Other, net	$	(13	)	$	(7	)	$	(25	)	$	(74	)
Net gain (loss) on currency transaction exposures	Other, net	9			1			13			64
Net currency exchange gain (loss)		$	(4	)	$	(6	)	$	(12	)	$	(10	)

Classification of derivative assets and liabilities within level 2

The following are the balances of our derivative assets and liabilities:

	Location in Unaudited Condensed Consolidated Balance Sheets (1)	As of
		September 30,		December 31,
(in millions)		2017		2016
Derivative Assets:
Designated Derivative Instruments
Forward currency contracts	Other current assets	$	7	$	98
Forward currency contracts	Other long-term assets	59		65
		66		163
Non-Designated Derivative Instruments
Forward currency contracts	Other current assets	17		36
Total Derivative Assets		$	83	$	199
Derivative Liabilities:
Designated Derivative Instruments
Forward currency contracts	Other current liabilities	$	38	$	3
Forward currency contracts	Other long-term liabilities	25		4
		63		7
Non-Designated Derivative Instruments
Forward currency contracts	Other current liabilities	29		19
Total Derivative Liabilities		$	92	$	26

(1) We classify derivative assets and liabilities as current when the remaining term of the derivative contract is one year or less.

Assets and liabilities measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis consist of the following:

	As of
	September 30, 2017								December 31, 2016
(in millions)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Money market and government funds	$	27	$	—	$	—	$	27	$	42	$	—	$	—	$	42
Available-for-sale securities	32		—		—		32		20		—		—		20
Forward currency contracts	—		83		—		83		—		199		—		199
	$	59	$	83	$	—	$	142	$	62	$	199	$	—	$	261
Liabilities
Forward currency contracts	$	—	$	92	$	—	$	92	$	—	$	26	$	—	$	26
Accrued contingent consideration	—		—		81		81		—		—		204		204
	$	—	$	92	$	81	$	173	$	—	$	26	$	204	$	230