10-Q

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TABLE OF CONTENTS

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)
ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 2014
or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                                    to
Commission file number 1-15525

EDWARDS LIFESCIENCES CORPORATION
(Exact name of registrant as specified in its charter)

Delaware	36-4316614
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
One Edwards Way, Irvine, California	92614
(Address of principal executive offices)	(Zip Code)
(949) 250-2500 (Registrant's telephone number, including area code)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ý Accelerated filer o Non-accelerated filer o
(Do not check if a smaller
reporting company) Smaller Reporting Company o

        Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No ý

        The number of shares outstanding of the registrant's common stock, $1.00 par value, as of July 31, 2014 was 106,033,418.

EDWARDS LIFESCIENCES CORPORATION

FORM 10-Q
For the quarterly period ended June 30, 2014

TABLE OF CONTENTS

		Page Number
Part I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)		1
	Consolidated Condensed Balance Sheets		1
	Consolidated Condensed Statements of Operations		2
	Consolidated Condensed Statements of Comprehensive Income		3
	Consolidated Condensed Statements of Cash Flows		4
	Notes to Consolidated Condensed Financial Statements		5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations		23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		32
Item 4.	Controls and Procedures		32
Part II.	OTHER INFORMATION
Item 1.	Legal Proceedings		33
Item 1A.	Risk Factors		33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		33
Item 6.	Exhibits		33
Signature			35
Exhibits			36

Part I. Financial Information

Item 1.    Financial Statements

EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED BALANCE SHEETS

(in millions, except par value; unaudited)

	June 30, 2014			December 31, 2013
ASSETS
Current assets
Cash and cash equivalents	$	498.6		$	420.4
Short-term investments (Note 6)		985.5			516.5
Accounts and other receivables, net of allowances of $5.6 and $5.4, respectively		327.5			328.0
Inventories (Note 5)		317.1			308.9
Deferred income taxes		42.8			33.4
Prepaid expenses		46.3			46.8
Other current assets		60.3			71.8
Total current assets		2,278.1			1,725.8
Long-term accounts receivable, net of allowances of $6.7 and $6.8, respectively		7.6			7.3
Long-term investments (Note 6)		99.0			21.9
Property, plant and equipment, net		422.5			421.6
Goodwill		384.3			385.4
Other intangible assets, net (Note 7)		29.5			33.5
Deferred income taxes		69.9			79.0
Other assets		35.7			35.4
	$	3,326.6		$	2,709.9
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	540.5		$	345.6
Long-term debt (Note 8)		598.0			593.1
Other long-term liabilities		273.2			226.8
Commitments and contingencies (Note 13)
Stockholders' equity
Preferred stock, $.01 par value, authorized 50.0 shares, no shares outstanding		—			—
Common stock, $1.00 par value, 350.0 shares authorized, 127.1 and 126.0 shares issued, and 106.0 and 109.3 shares outstanding, respectively		127.1			126.0
Additional paid-in capital		747.4			671.2
Retained earnings		2,638.1			2,030.8
Accumulated other comprehensive loss		(41.1	)		(27.6	)
Treasury stock, at cost, 21.1 and 16.7 shares, respectively		(1,556.6	)		(1,256.0	)
Total stockholders' equity		1,914.9			1,544.4
	$	3,326.6		$	2,709.9

The accompanying notes are an integral part of these
consolidated condensed financial statements.

1

EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(in millions, except per share information; unaudited)

	Three Months Ended June 30,					Six Months Ended June 30,
	2014			2013		2014			2013
Net sales	$	575.1		$	517.2	$	1,097.5		$	1,013.9
Cost of sales		151.2			123.6		297.1			244.6
Gross profit		423.9			393.6		800.4			769.3
Selling, general and administrative expenses		215.5			186.6		412.7			369.0
Research and development expenses		89.1			80.5		174.9			160.3
Intellectual property litigation (income) expense, net (Note 3)		(747.4	)		5.5		(741.9	)		(72.6	)
Special charges (Note 4)		50.0			—		57.5			—
Interest expense, net		3.1			0.4		6.6			0.2
Other expense, net		0.4			0.1		0.1			1.3
Income before provision for income taxes		813.2			120.5		890.5			311.1
Provision for income taxes		266.2			27.2		283.2			73.9
Net income	$	547.0		$	93.3	$	607.3		$	237.2
Share information (Note 15)
Earnings per share:
Basic	$	5.18		$	0.83	$	5.72		$	2.09
Diluted	$	5.09		$	0.81	$	5.63		$	2.05
Weighted-average number of common shares outstanding:
Basic		105.6			112.6		106.1			113.3
Diluted		107.4			114.7		107.9			115.6

The accompanying notes are an integral part of these
consolidated condensed financial statements.

2

EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(in millions; unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Net income	$	547.0		$	93.3		$	607.3		$	237.2
Other comprehensive (loss) income, net of tax (Note 14)
Foreign currency translation adjustments		(5.4	)		4.6			(6.2	)		(19.6	)
Unrealized (loss) gain on cash flow hedges		(3.4	)		(0.2	)		(7.4	)		9.9
Unrealized loss on available-for-sale investments		(0.2	)		(0.4	)		(0.2	)		(0.4	)
Reclassification of net realized investment loss to earnings		0.3			—			0.3			—
Other comprehensive (loss) income		(8.7	)		4.0			(13.5	)		(10.1	)
Comprehensive income	$	538.3		$	97.3		$	593.8		$	227.1

The accompanying notes are an integral part of these
consolidated condensed financial statements.

3

EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(in millions; unaudited)

	Six Months Ended June 30,
	2014			2013
Cash flows from operating activities
Net income	$	607.3		$	237.2
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		32.3			28.8
Stock-based compensation (Note 12)		23.9			24.0
Excess tax benefit from stock plans		(21.3	)		(58.9	)
Special charges (Note 4)		7.5			—
Loss (gain) on investments		3.3			(0.4	)
Deferred income taxes		2.0			0.7
Other		(2.0	)		0.8
Changes in operating assets and liabilities:
Accounts and other receivables, net		(0.2	)		(8.7	)
Inventories		(11.5	)		(31.7	)
Accounts payable and accrued liabilities		282.7			11.9
Prepaid expenses and other current assets		(10.8	)		25.2
Other		3.7			0.3
Net cash provided by operating activities		916.9			229.2
Cash flows from investing activities
Capital expenditures		(30.3	)		(66.3	)
Purchases of held-to-maturity investments		(1,146.5	)		(222.0	)
Proceeds from held-to-maturity investments		594.9			230.9
Investments in trading securities, net		(10.9	)		(0.2	)
Proceeds from (investments in) unconsolidated affiliates, net		1.3			(1.6	)
Other		1.3			(0.1	)
Net cash used in investing activities		(590.2	)		(59.3	)
Cash flows from financing activities
Proceeds from issuance of debt		214.1			332.2
Payments on debt		(212.9	)		(292.0	)
Purchases of treasury stock		(300.6	)		(246.6	)
Excess tax benefit from stock plans		21.3			58.9
Proceeds from stock plans		32.9			27.4
Other		(2.4	)		5.9
Net cash used in financing activities		(247.6	)		(114.2	)
Effect of currency exchange rate changes on cash and cash equivalents		(0.9	)		6.1
Net increase in cash and cash equivalents		78.2			61.8
Cash and cash equivalents at beginning of period		420.4			310.9
Cash and cash equivalents at end of period	$	498.6		$	372.7
Supplemental disclosures:
Non-cash investing and financing transactions:
Capital expenditures accruals	$	8.2		$	2.9

The accompanying notes are an integral part of these
consolidated condensed financial statements.

4

1.     BASIS OF PRESENTATION

        The accompanying interim consolidated condensed financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") and should be read in conjunction with the consolidated financial statements and notes included in Edwards Lifesciences Corporation's Annual Report on Form 10-K for the year ended December 31, 2013. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles ("GAAP") have been condensed or omitted.

        In the opinion of management of Edwards Lifesciences Corporation ("Edwards Lifesciences" or the "Company"), the interim consolidated condensed financial statements reflect all adjustments considered necessary for a fair statement of the interim periods. All such adjustments are of a normal, recurring nature. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year.

Cash Flow Statement Revision

        In preparing the consolidated financial statements for the year ended December 31, 2013, the Company determined that it had misclassified certain accrued capital expenditures in the consolidated condensed statements of cash flows for the six months ended June 30, 2013. The Company has evaluated and concluded that this did not result in a material misstatement of the Company's previously issued consolidated financial statements. However, the Company has elected to revise its consolidated condensed statement of cash flows for the six months ended June 30, 2013 to correct the presentation of accrued capital expenditures, resulting in an increase to net cash used in investing activities (with a corresponding increase to net cash provided by operating activities) of $14.9 million.

Recently Adopted Accounting Standards

        In July 2013, the Financial Accounting Standards Board ("FASB") issued an amendment to the accounting guidance on income taxes impacting the presentation of unrecognized tax benefits. The guidance requires an entity to net its unrecognized tax benefits against the deferred tax assets for all same jurisdiction net operating loss or similar tax loss carryforwards, or tax credit carryforwards. The guidance was effective for annual reporting periods beginning after December 15, 2013 and interim periods therein. The adoption of this guidance did not have a material impact on the Company's consolidated condensed financial statements.

New Accounting Standards Not Yet Adopted

        In May 2014, the FASB issued an update to the accounting guidance on revenue recognition. The new guidance provides a comprehensive, principles-based approach to revenue recognition, and supersedes most previous revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires improved disclosures on the nature, amount, timing and uncertainty of revenue that is recognized. The guidance is effective for annual reporting periods beginning after December 15, 2016 and interim periods therein. The new guidance can be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of the change recognized at the date of the initial application. The Company is currently assessing the impact this guidance will have on its consolidated financial statements, and has not yet selected a transition method.

5

2.     CHANGE IN ACCOUNTING PRINCIPLE

        Effective January 1, 2014, the Company changed its method of accounting for certain intellectual property litigation expenses related to the defense and enforcement of issued patents. Previously, the Company capitalized these legal costs if a favorable outcome in the patent defense was determined to be probable, and amortized the capitalized legal costs over the life of the related patent. As of December 31, 2013, the Company had remaining unamortized capitalized legal costs of $23.7 million, which, under the previous accounting method, would have been amortized through 2021. Under the new method of accounting, these legal costs are expensed in the period they are incurred. The Company has retrospectively adjusted the comparative financial statements of prior periods to apply this new method of accounting.

        The Company believes this change in accounting principle is preferable because (1) as more competitors enter the Company's key product markets and the threat of complex intellectual property litigation across multiple jurisdictions increases, it will become more difficult for the Company to accurately assess the probability of a favorable outcome in such litigation, and (2) it will enhance the comparability of the Company's financial results with those of its peer group because it is the predominant accounting practice in the Company's industry.

        The accompanying consolidated condensed financial statements and related notes have been adjusted to reflect the impact of this change retrospectively to all prior periods presented. The cumulative effect of the change in accounting principle was a decrease in retained earnings of $12.2 million as of January 1, 2013. The following tables present the effects of the retrospective application of the change in accounting principle (in millions):

	As of December 31, 2013
Consolidated Condensed Balance Sheet	As Reported		As Adjusted
Other intangible assets, net	$	57.2	$	33.5
Deferred income taxes		70.1		79.0
Total assets		2,724.7		2,709.9
Retained earnings		2,045.6		2,030.8
Total stockholders' equity		1,559.2		1,544.4
Total liabilities and stockholders' equity		2,724.7		2,709.9

	Three Months Ended June 30, 2013				Six Months Ended June 30, 2013
Consolidated Condensed Statement of Operations	As Reported		As Adjusted		As Reported			As Adjusted
Cost of sales	$	125.0	$	123.6	$	247.2		$	244.6
Gross profit		392.2		393.6		766.7			769.3
Selling, general and administrative expenses(a)		189.4		186.6		374.6			369.0
Intellectual property litigation expense (income), net(a)		—		5.5		—			(72.6	)
Special gain(a)		—		—		(83.6	)		—
Income before provision for income taxes		121.8		120.5		313.9			311.1
Provision for income taxes		27.7		27.2		74.9			73.9
Net income		94.1		93.3		239.0			237.2
Earnings per share:
Basic	$	0.84	$	0.83	$	2.11		$	2.09
Diluted	$	0.82	$	0.81	$	2.07		$	2.05

(a)

The above amounts also reflect certain reclassifications of previously reported amounts related to intellectual property litigation to conform to classifications used in the current year.

6

	Three Months Ended June 30, 2013				Six Months Ended June 30, 2013
Consolidated Condensed Statement of Comprehensive Income	As Reported		As Adjusted		As Reported		As Adjusted
Net income	$	94.1	$	93.3	$	239.0	$	237.2
Comprehensive income		98.1		97.3		228.9		227.1

	Six Months Ended June 30, 2013
Consolidated Condensed Statement of Cash Flows	As Reported			As Adjusted
Net income	$	239.0		$	237.2
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		31.4			28.8
Other		1.1			0.8
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		26.2			25.2
Other		(5.4	)		0.3

3.     INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET

        In May 2014, the Company entered into an agreement with Medtronic, Inc. and its affiliates ("Medtronic") to settle all outstanding patent litigation between the companies, including all cases related to transcatheter heart valves. Pursuant to the agreement, all pending cases or appeals in courts and patent offices worldwide have been dismissed, and the parties will not litigate patent disputes with each other in the field of transcatheter valves for the eight-year term of the agreement. Under the terms of a patent cross-license that is part of the agreement, Medtronic made a one-time, upfront payment to the Company in the amount of $750.0 million. In addition, Medtronic will pay the Company quarterly license royalty payments through April 2022. For sales in the United States, the royalty payments will be based on a percentage of Medtronic's sales of transcatheter aortic valves, subject to a minimum annual payment of $40.0 million and a maximum annual payment of $60.0 million. A separate royalty payment will be calculated based on sales of Medtronic transcatheter aortic valves manufactured in the United States but sold elsewhere. For further information, see Note 13.

        The Company accounted for the settlement agreement as a multiple-element arrangement and allocated the total consideration to the identifiable elements based upon their relative fair value. The consideration assigned to each element was as follows:

Past damages	$	754.3
License agreement		238.0
Covenant not to sue		77.7
Total	$	1,070.0

        The Company recognized the upfront payment of $750.0 million in "Intellectual Property Litigation (Income) Expense, net" during the second quarter of 2014. The accounting guidance limits the amount to be recognized upfront to the amount of cash received. Therefore, the remaining fair value associated with the past damages element, and the amounts assigned to the license agreement and covenant not to sue, will be recognized in "Net Sales" over the term of the license agreement as delivery occurs since the Company considers the future royalties to be part of its revenue-earning activities that constitute its ongoing major or central operations.

7

        The Company incurred external legal costs related to intellectual property litigation of $2.6 million and $5.5 million for the three months ended June 30, 2014 and 2013, respectively, and $8.1 million and $11.0 million for the six months ended June 30, 2014 and 2013, respectively.

        In February 2013, the Company received $83.6 million from Medtronic in satisfaction of the initial April 2010 jury award of damages for infringement of the United States Andersen transcatheter heart valve patent, including accrued interest.

4.     SPECIAL CHARGES

Charitable Foundation Contribution

        In June 2014, the Company contributed $50.0 million to the Edwards Lifesciences Foundation, a related-party not-for-profit organization intended to provide philanthropic support to health- and community-focused charitable organizations. The contribution was irrevocable and was recorded as an expense at the time of payment.

Settlement

        In March 2014, the Company recorded a $7.5 million charge to settle past and future obligations related to one of its intellectual property agreements.

5.     INVENTORIES

        Inventories consisted of the following (in millions):

	June 30, 2014		December 31, 2013
Raw materials	$	60.4	$	57.8
Work in process		79.1		82.2
Finished products		177.6		168.9
	$	317.1	$	308.9

6.     INVESTMENTS

Held-to-maturity Investments

        Held-to-maturity investments at the end of each period were as follows (in millions):

	June 30, 2014								December 31, 2013
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Bank time deposits	$	886.3	$	—	$	—	$	886.3	$	516.5	$	—	$	—	$	516.5
Commercial paper		89.8		—		—		89.8		—		—		—		—
U.S. government and agency securities		50.8		0.1		—		50.9		—		—		—		—
Asset-backed securities		9.4		—		—		9.4		—		—		—		—
Corporate debt securities		25.0		—		—		25.0		—		—		—		—
Municipal securities		5.1		—		—		5.1		—		—		—		—
Total	$	1,066.4	$	0.1	$	—	$	1,066.5	$	516.5	$	—	$	—	$	516.5

8

        The cost and fair value of held-to-maturity investments, by contractual maturity, as of June 30, 2014 were as follows:

	Cost		Fair Value
	(in millions)
Due in 1 year or less	$	985.5	$	985.5
Due after 1 year through 5 years		63.6		63.7
Instruments not due at a single maturity date		17.3		17.3
	$	1,066.4	$	1,066.5

        Actual maturities may differ from the contractual maturities due to call or prepayment rights.

Investments in Unconsolidated Affiliates

        The Company has a number of equity investments in privately and publicly held companies. Investments in these unconsolidated affiliates are recorded in "Long-term Investments" on the consolidated condensed balance sheets, and are as follows:

	June 30, 2014			December 31, 2013
	(in millions)
Available-for-sale investments
Cost	$	0.4		$	0.4
Unrealized gains		0.1			0.4
Fair value of available-for-sale investments		0.5			0.8
Equity method investments
Cost		12.4			14.1
Equity in losses		(1.5	)		(2.7	)
Carrying value of equity method investments		10.9			11.4
Cost method investments
Carrying value of cost method investments		6.7			9.7
Total investments in unconsolidated affiliates	$	18.1		$	21.9

        In March 2014, the Company recorded an other-than-temporary impairment charge of $3.5 million related to one of its cost method investments.

9

7.     OTHER INTANGIBLE ASSETS

        Other intangible assets consisted of the following (in millions):

	June 30, 2014							December 31, 2013
	Cost		Accumulated Amortization			Net Carrying Value		Cost		Accumulated Amortization			Net Carrying Value
Amortizable intangible assets
Patents	$	181.5	$	(166.3	)	$	15.2	$	181.6	$	(163.5	)	$	18.1
Developed technology		48.0		(36.0	)		12.0		43.3		(35.1	)		8.2
Other		10.7		(8.4	)		2.3		10.7		(8.1	)		2.6
		240.2		(210.7	)		29.5		235.6		(206.7	)		28.9
Unamortizable intangible assets
In-process research and development		—		—			—		4.6		—			4.6
	$	240.2	$	(210.7	)	$	29.5	$	240.2	$	(206.7	)	$	33.5

        The net carrying value of patents as of December 31, 2013 has been adjusted to reflect the Company's change in its method of accounting for certain legal costs related to the defense and enforcement of issued patents. For further information, see Note 2.

        In June 2014, the Company transferred its remaining in-process research and development assets, which related to technology acquired from BMEYE, B.V., to developed technology because the Company had received United States Food and Drug Administration approval for the product.

        Amortization expense related to other intangible assets was $2.0 million and $2.5 million for the three months ended June 30, 2014 and 2013, respectively, and $4.1 million and $5.0 million for the six months ended June 30, 2014 and 2013, respectively. Estimated amortization expense for each of the years ending December 31 is as follows (in millions):

2014	$	8.5
2015		7.8
2016		7.6
2017		6.9
2018		1.6

        The Company expenses costs incurred to renew or extend the term of acquired intangible assets.

8.     DEBT

        In October 2013, the Company issued $600.0 million of 2.875% fixed-rate unsecured senior notes due October 15, 2018 (the "Notes"). Interest is payable semi-annually in arrears, with the first payment due in April 2014. The effective interest rate is 2.983%. Issuance costs of $5.4 million, as well as a $3.0 million discount on the Notes, are being amortized to interest expense over the term of the Notes. As of June 30, 2014, the carrying value of the Notes was $598.0 million.

        The Company has a Four-Year Credit Agreement ("Credit Facility") that matures on July 29, 2015. The Credit Facility provides for aggregate borrowings up to $750.0 million. As of June 30, 2014, there were no borrowings outstanding under the Credit Facility.

        In July 2014, the Company entered into a new Five-Year Credit Agreement ("the Credit Agreement") which matures on July 18, 2019, and the existing Credit Facility was terminated. The Credit Agreement provides up to an aggregate of $750.0 million in borrowings in multiple currencies. The Company may increase the amount available under the Credit Agreement, subject to agreement of

10

the lenders, by up to an additional $250.0 million in the aggregate. Borrowings generally bear interest at the London interbank offered rate ("LIBOR") plus a spread ranging from 1.0% to 1.5%, depending on the leverage ratio, as defined in the Credit Agreement. The Company also pays a facility fee ranging from 0.125% to 0.25%, depending on the leverage ratio, on the entire credit commitment available, whether or not drawn. The Credit Agreement is unsecured and contains various financial and other covenants, including a maximum leverage ratio and a minimum interest coverage ratio, as defined in the Credit Agreement.

9.     FAIR VALUE MEASUREMENTS

        The consolidated condensed financial statements include financial instruments for which the fair market value of such instruments may differ from amounts reflected on a historical cost basis. Financial instruments of the Company consist of cash deposits, accounts and other receivables, investments, accounts payable, certain accrued liabilities and borrowings under a revolving credit agreement. The carrying value of these financial instruments generally approximates fair value due to their short-term nature. Financial instruments also include notes payable. As of June 30, 2014, the fair value of the notes payable, based on Level 2 inputs, was $617.4 million.

        Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Company prioritizes the inputs used to determine fair values in one of the following three categories:

Level 1—Quoted market prices in active markets for identical assets or liabilities.

Level 2—Inputs, other than quoted prices in active markets, that are observable, either directly or indirectly.

Level 3—Unobservable inputs that are not corroborated by market data.

        In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety.

11

Assets and Liabilities Measured at Fair Value on a Recurring Basis

        The following table summarizes the Company's financial instruments which are measured at fair value on a recurring basis (in millions):

June 30, 2014	Level 1		Level 2		Level 3		Total
Assets
Investments held for deferred compensation plans	$	26.5	$	—	$	—	$	26.5
Available-for-sale investments		0.5		—		—		0.5
Derivatives		—		3.9		—		3.9
	$	27.0	$	3.9	$	—	$	30.9
Liabilities
Derivatives	$	—	$	7.1	$	—	$	7.1
Deferred compensation plans		26.5		—		—		26.5
	$	26.5	$	7.1	$	—	$	33.6
December 31, 2013
Assets
Investments held for deferred compensation plans	$	15.1	$	—	$	—	$	15.1
Available-for-sale investments		0.8		—		—		0.8
Derivatives		—		13.8		—		13.8
	$	15.9	$	13.8	$	—	$	29.7
Liabilities
Derivatives	$	—	$	17.2	$	—	$	17.2
Deferred compensation plans		15.5		—		—		15.5
	$	15.5	$	17.2	$	—	$	32.7

Deferred Compensation Plans

        The Company holds investments in trading securities related to its deferred compensation plans. The investments are in a variety of stock and bond mutual funds. The fair values of these investments and the corresponding liabilities are based on quoted market prices and are categorized as Level 1.

Available-for-sale Investments

        The Company has a number of long-term equity investments in companies that are in various stages of development. Certain of these investments have been designated as available-for-sale. These investments are carried at fair market value based on quoted market prices and are categorized as Level 1.

Derivative Instruments

        The Company uses derivative financial instruments in the form of foreign currency forward exchange contracts to manage foreign currency exposures and interest rate swap agreements to manage its interest rate exposures. All derivatives contracts are recognized on the balance sheet at their fair value. The fair value of foreign currency derivative financial instruments was estimated by discounting expected cash flows using quoted market interest rates and foreign exchange rates. The fair value of the interest rate swap agreements was determined based on a discounted cash flow analysis reflecting the contractual terms of the agreements and the 6-month LIBOR forward interest rate curve. Judgment was employed in interpreting market data to develop estimates of fair value; accordingly, the estimates

12

presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The use of different market assumptions or valuation methodologies could have a material effect on the estimated fair value amounts. The derivative instruments are categorized as Level 2.

10.   DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

        The Company uses derivative financial instruments to manage its currency exchange rate risk and its interest rate risk, as summarized below. Notional amounts are stated in United States dollar equivalents at spot exchange rates at the respective dates.

	Notional Amount
	June 30, 2014		December 31, 2013
	(in millions)
Foreign currency forward exchange contracts	$	805.3	$	805.5
Interest rate swap agreements	$	300.0	$	300.0

        The Company uses derivative financial instruments to manage interest rate and foreign currency risks. It is the Company's policy not to enter into derivative financial instruments for speculative purposes. The Company uses interest rate swaps to convert a portion of its fixed-rate debt into variable-rate debt. These interest rate swaps are designated as fair value hedges and meet the shortcut method requirements under the accounting standards for derivatives and hedging. Accordingly, changes in the fair values of the interest rate swaps are considered to exactly offset changes in the fair value of the underlying long-term debt. The Company uses foreign currency forward exchange contracts to offset the changes due to currency rate movements in the amount of future cash flows associated with intercompany transactions and certain third-party expenses expected to occur within the next 13 months. These foreign currency forward exchange contracts are designated as cash flow hedges. Certain of the Company's locations have assets and liabilities denominated in currencies other than their functional currencies resulting from intercompany and third-party transactions. The Company uses foreign currency forward exchange contracts that are not designated as hedging instruments to offset the transaction gains and losses associated with certain of these assets and liabilities. All foreign currency forward exchange contracts are denominated in currencies of major industrial countries, principally the Euro and the Japanese yen.

        All derivative financial instruments are recognized at fair value in the consolidated condensed balance sheets. For each derivative instrument that is designated and effective as a fair value hedge, the gain or loss on the derivative is recognized immediately to earnings, and offsets the loss or gain on the underlying hedged item. The gain or loss on fair value hedges is classified in net interest expense, as they hedge the interest rate risk associated with the Company's fixed-rate debt. The Company reports in "Accumulated Other Comprehensive Loss" the effective portion of the gain or loss on derivative financial instruments that are designated, and that qualify, as cash flow hedges. The Company reclassifies these gains and losses into earnings in the same period in which the underlying hedged transactions affect earnings. Any hedge ineffectiveness (which represents the amount by which the changes in the fair value of the derivative exceed the variability in the cash flows of the forecasted transaction) is recorded in current period earnings. For the six months ended June 30, 2014 and 2013, the Company did not record any gains or losses due to hedge ineffectiveness. The gains and losses on derivative financial instruments for which the Company does not elect hedge accounting treatment are recognized in the consolidated condensed statements of operations in each period based upon the change in the fair value of the derivative financial instrument. Cash flows from derivative financial instruments are reported as operating activities in the consolidated condensed statements of cash flows.

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        Derivative financial instruments involve credit risk in the event the counterparty should default. It is the Company's policy to execute such instruments with global financial institutions that the Company believes to be creditworthy. The Company diversifies its derivative financial instruments among counterparties to minimize exposure to any one of these entities. The Company also uses International Swap Dealers Association master-netting agreements. The master-netting agreements provide for the net settlement of all contracts through a single payment in a single currency in the event of default, as defined by the agreements.

        The following table presents the location and fair value amounts of derivative instruments reported in the consolidated condensed balance sheets (in millions):

		Fair Value
Derivatives designated as hedging instruments	Balance Sheet Location	June 30, 2014		December 31, 2013
Assets
Foreign currency contracts	Other current assets	$	3.2	$	13.8
Interest rate swap agreements	Other assets	$	0.7	$	—
Liabilities
Foreign currency contracts	Accrued and other liabilities	$	7.1	$	13.2
Interest rate swap agreements	Other long-term liabilities	$	—	$	4.0

        The following table presents the effect of master-netting agreements and rights of offset on the consolidated condensed balance sheets (in millions):

							Gross Amounts Not Offset in the Consolidated Balance Sheet
			Gross Amounts Offset in the Consolidated Balance Sheet
					Net Amounts Presented in the Consolidated Balance Sheet
June 30, 2014	Gross Amounts						Financial Instruments			Cash Collateral Received		Net Amount
Derivative Assets
Foreign currency contracts	$	3.2	$	—	$	3.2	$	(3.2	)	$	—	$	—
Interest rate swap agreements	$	0.7	$	—	$	0.7	$	—		$	—	$	0.7
Derivative Liabilities
Foreign currency contracts	$	7.1	$	—	$	7.1	$	(3.2	)	$	—	$	3.9
December 31, 2013
Derivative Assets
Foreign currency contracts	$	13.8	$	—	$	13.8	$	(9.5	)	$	—	$	4.3
Derivative Liabilities
Foreign currency contracts	$	13.2	$	—	$	13.2	$	(9.5	)	$	—	$	3.7
Interest rate swap agreements	$	4.0	$	—	$	4.0	$	—		$	—	$	4.0

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        The following tables present the effect of derivative instruments on the consolidated condensed statements of operations and consolidated condensed statements of comprehensive income (in millions):

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income
	Three Months Ended June 30,						Three Months Ended June 30,
						Location of Gain or (Loss) Reclassified from Accumulated OCI into Income
Derivatives in cash flow hedging relationships	2014			2013			2014		2013
Foreign currency contracts	$	(2.7	)	$	6.0	Cost of sales	$	3.0	$	5.8

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income
	Six Months Ended June 30,						Six Months Ended June 30,
						Location of Gain or (Loss) Reclassified from Accumulated OCI into Income
Derivatives in cash flow hedging relationships	2014			2013			2014		2013
Foreign currency contracts	$	(4.4	)	$	27.7	Cost of sales	$	8.0	$	11.0

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Three Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives in fair value hedging relationships		2014		2013
Interest rate swap agreements	Interest expense, net	$	2.6	$	—

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Six Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives in fair value hedging relationships		2014		2013
Interest rate swap agreements	Interest expense, net	$	4.7	$	—

        The gains on the interest rate swap agreements are fully offset by the changes in the fair value of the fixed-rate debt being hedged.

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Three Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives not designated as hedging instruments		2014			2013
Foreign currency contracts	Other expense, net	$	(2.5	)	$	5.1

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Six Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives not designated as hedging instruments		2014			2013
Foreign currency contracts	Other expense, net	$	(3.2	)	$	14.4

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        The Company expects that during the next twelve months it will reclassify to earnings a $2.8 million loss currently recorded in "Accumulated Other Comprehensive Loss."

11.   DEFINED BENEFIT PLANS

        The components of net periodic benefit cost for the three and six months ended June 30, 2014 and 2013 were as follows (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Service cost	$	1.8		$	1.9		$	3.5		$	3.9
Interest cost		0.6			0.5			1.2			1.0
Expected return on plan assets		(0.5	)		(0.3	)		(0.9	)		(0.6	)
Amortization of actuarial loss, prior service credit and other		—			0.3			0.1			0.5
Net periodic benefit cost	$	1.9		$	2.4		$	3.9		$	4.8

12.   STOCK-BASED COMPENSATION

        Stock-based compensation expense related to awards issued under the Company's incentive compensation plans for the three and six months ended June 30, 2014 and 2013 was as follows (in millions):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Cost of sales	$	1.5	$	1.5	$	3.0	$	2.9
Selling, general and administrative expenses		8.6		9.4		17.4		17.6
Research and development expenses		1.8		1.9		3.5		3.5
Total stock-based compensation expense	$	11.9	$	12.8	$	23.9	$	24.0

        At June 30, 2014, the total remaining compensation cost related to nonvested stock options, restricted stock units, market-based restricted stock units and employee stock purchase plan ("ESPP") subscription awards amounted to $100.8 million, which will be amortized on a straight-line basis over the weighted-average remaining requisite service period of 32 months.

        During the six months ended June 30, 2014, the Company granted 1.3 million stock options at a weighted-average exercise price of $82.23 and 0.2 million shares of restricted stock units at a weighted-average grant-date fair value of $78.88. The Company also granted 39,000 shares of market-based restricted stock units at a weighted-average grant-date fair value of $108.75. The market-based restricted stock units vest based on a combination of certain service and market conditions. The actual number of shares issued will be determined based on the Company's total shareholder return relative to a selected industry peer group over a three-year performance period, and may range from 0% to 175% of the targeted number of shares granted.

Fair Value Disclosures

        The fair value of the market-based restricted stock units was determined using a Monte Carlo simulation model, which uses multiple input variables to determine the probability of satisfying the market condition requirements. The weighted-average assumptions used to determine the fair value of

16

the market-based restricted stock units granted during the six months ended June 30, 2014 and 2013 included a risk-free interest rate of 0.9% and 0.4%, respectively, and an expected volatility rate of 31.7% and 33.4%, respectively.

        The Black-Scholes option pricing model was used with the following weighted-average assumptions for options granted during the following periods:

Option Awards

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Average risk-free interest rate		1.4	%		0.8	%		1.4	%		0.8	%
Expected dividend yield		None			None			None			None
Expected volatility		30.7	%		30.7	%		30.7	%		30.7	%
Expected term (years)		4.5			4.6			4.6			4.6
Fair value, per share	$	23.58		$	19.40		$	23.21		$	19.47

        The Black-Scholes option pricing model was used with the following weighted-average assumptions for ESPP subscriptions granted during the following periods:

ESPP

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Average risk-free interest rate		0.1	%		0.1	%		0.1	%		0.1	%
Expected dividend yield		None			None			None			None
Expected volatility		29.2	%		33.3	%		31.3	%		35.4	%
Expected term (years)		0.7			0.7			0.7			0.7
Fair value, per share	$	18.33		$	21.48		$	16.96		$	22.94

13.   COMMITMENTS AND CONTINGENCIES

        On May 19, 2014, Edwards Lifesciences entered into an agreement (the "Settlement Agreement") with Medtronic to, among other things, settle all outstanding patent litigation between the parties (see Note 3). Pursuant to the Settlement Agreement, all of the following pending cases and related appeals in courts worldwide were dismissed:

•

the lawsuit filed in February 2008 by Edwards Lifesciences against Medtronic in the U.S. District Court for the District of Delaware (the "District Court") alleging that its ReValving System infringes three of Edwards' U.S. Andersen patents, later narrowed to one patent;

•

a second lawsuit pending in the District Court against Medtronic alleging infringement of two of Edwards' U.S. Andersen patents;

•

the lawsuit against Medtronic in the District Court alleging infringement of an Edwards' U.S. Letac-Cribier transcatheter heart valve patent;

•

the lawsuit filed in June 2011 by Medtronic against Edwards Lifesciences in the U.S. District Court for the District of Minnesota alleging that certain surgical valve holders and a surgical embolic filter device infringe its patents and including Edwards' counterclaim alleging infringement of Edwards' annuloplasty ring patents;

17

•

the lawsuit filed in June 2011 by Medtronic against Edwards Lifesciences in the U.S. District Court for the Central District of California alleging that the Edwards SAPIEN transcatheter heart valve infringes a Medtronic patent, which patent was subsequently ruled invalid and the lawsuit was dismissed in favor of Edwards;

•

the lawsuit filed in March 2012 by Medtronic in the U.S. District Court for the Central District of California alleging that the methods of implanting the Edwards SAPIEN transcatheter heart valve in the United States infringe two Medtronic patents relating to methods of pacing the heart; and

•

the lawsuit filed in August 2012 by Edwards Lifesciences against Medtronic in the German District Court of Mannheim alleging that Medtronic's CoreValve and Evolut valves infringed three of Edwards' transcatheter valve patents.

        Edwards Lifesciences is or may be a party to, or may otherwise be responsible for, pending or threatened lawsuits related primarily to products and services currently or formerly manufactured or performed, as applicable, by Edwards Lifesciences. Such cases and claims raise difficult and complex factual and legal issues and are subject to many uncertainties, including, but not limited to, the facts and circumstances of each particular case or claim, the jurisdiction in which each suit is brought, and differences in applicable law. Upon resolution of any such legal matter or other claim, Edwards Lifesciences may incur charges in excess of established reserves. The Company is not able to estimate the amount or range of any loss for legal contingencies for which there is no reserve or additional loss for matters already reserved. While any such charge related to matters could have a material adverse impact on Edwards Lifesciences' net income or cash flows in the period in which it is recorded or paid, management does not believe that any such charge relating to any currently pending lawsuit would have a material adverse effect on Edwards Lifesciences' financial position, results of operations or liquidity.

        Edwards Lifesciences is subject to various environmental laws and regulations both within and outside of the United States. The operations of Edwards Lifesciences, like those of other medical device companies, involve the use of substances regulated under environmental laws, primarily in manufacturing and sterilization processes. While it is difficult to quantify the potential impact of continuing compliance with environmental protection laws, management believes that such compliance will not have a material impact on Edwards Lifesciences' financial position, results of operations or liquidity.

14.   ACCUMULATED OTHER COMPREHENSIVE LOSS

        Presented below is a summary of activity for each component of "Accumulated Other Comprehensive Loss" for the six months ended June 30, 2014.

	Foreign Currency Translation Adjustments			Unrealized Gain (Loss) on Cash Flow Hedges			Unrealized Gain on Available-for- sale Investments			Unrealized Pension Costs			Total Accumulated Other Comprehensive Loss
	(in millions)
December 31, 2013	$	(20.2	)	$	3.5		$	0.3		$	(11.2	)	$	(27.6	)
Other comprehensive loss before reclassifications		(6.2	)		(4.4	)		(0.3	)		—			(10.9	)
Amounts reclassified from accumulated other comprehensive loss		—			(8.0	)		0.3			—			(7.7	)
Deferred income tax benefit		—			5.0			0.1			—			5.1
June 30, 2014	$	(26.4	)	$	(3.9	)	$	0.4		$	(11.2	)	$	(41.1	)

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        The following table provides information about amounts reclassified from "Accumulated Other Comprehensive Loss" (in millions):

	Three Months Ended June 30, 2014						Six Months Ended June 30, 2014
													Affected Line on Consolidated Condensed Statements of Operations
Details about Accumulated Other Comprehensive Loss Components	2014			2013			2014			2013
Gain on cash flow hedges	$	3.0		$	5.8		$	8.0		$	11.0		Cost of sales
		(1.1	)		(2.3	)		(3.0	)		(4.2	)	Provision for income taxes
	$	1.9		$	3.5		$	5.0		$	6.8		Net of tax
Loss on available-for-sale investments	$	(0.3	)	$	—		$	(0.3	)	$	—		Other expense, net
		—			—			—			—		Provision for income taxes
	$	(0.3	)	$	—		$	(0.3	)	$	—		Net of tax

15.   EARNINGS PER SHARE

        Basic earnings per share is computed by dividing net income by the weighted-average common shares outstanding during a period. Employee equity share options, nonvested shares and similar equity instruments granted by the Company are treated as potential common shares in computing diluted earnings per share. Diluted shares outstanding include the dilutive effect of restricted stock units, market-based restricted stock units, and in-the-money options. The dilutive impact of the restricted stock units, market-based restricted stock units, and in-the-money options is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount that the employee must pay for exercising stock options, the amount of compensation expense for future service that the Company has not yet recognized, and the amount of tax benefits that would be recorded in "Additional Paid-in Capital" when the award becomes deductible are assumed to be used to repurchase shares. Potential common share equivalents have been excluded where their inclusion would be anti-dilutive.

        The table below presents the computation of basic and diluted earnings per share (in millions, except for per share information):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Basic:
Net income	$	547.0	$	93.3	$	607.3	$	237.2
Weighted-average shares outstanding		105.6		112.6		106.1		113.3
Basic earnings per share	$	5.18	$	0.83	$	5.72	$	2.09
Diluted:
Net income	$	547.0	$	93.3	$	607.3	$	237.2
Weighted-average shares outstanding		105.6		112.6		106.1		113.3
Dilutive effect of stock plans		1.8		2.1		1.8		2.3
Dilutive weighted-average shares outstanding		107.4		114.7		107.9		115.6
Diluted earnings per share	$	5.09	$	0.81	$	5.63	$	2.05

19

        Stock options, restricted stock units, and market-based restricted stock units to purchase 4.4 million and 3.7 million shares for the three months ended June 30, 2014 and 2013, respectively, and 4.0 million and 3.0 million for the six months ended June 30, 2014 and 2013, respectively, were outstanding, but were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive.

16.   INCOME TAXES

        The Company's effective income tax rates were 32.7% and 22.6% for the three months ended June 30, 2014 and 2013, respectively, and 31.8% and 23.8% for the six months ended June 30, 2014 and 2013, respectively.

        The effective tax rate for the three and six months ended June 30, 2014 included (1) $262.1 million of tax expense associated with a $750.0 million litigation settlement payment received from Medtronic in May 2014 (see Note 3) and (2) $6.2 million of tax benefits from the remeasurement of uncertain tax positions.

        The federal research credit expired on December 31, 2013 and has not been reinstated as of June 30, 2014. Therefore, the effective income tax rates for the three and six months ended June 30, 2014 were calculated without an assumed benefit for the federal research credit. In 2013, the federal research credit related to 2013 favorably impacted the effective tax rate by approximately 1.3%. The effective income tax rate for the six months ended June 30, 2013 included (1) an $8.4 million benefit for the full year 2012 federal research credit, which was reinstated on January 2, 2013 and (2) $31.3 million of tax expense associated with the $83.6 million litigation award received from Medtronic in February 2013 (see Note 3).

        The Company strives to resolve open matters with each tax authority at the examination level and could reach agreement with a tax authority at any time. While the Company has accrued for matters it believes are more likely than not to require settlement, the final outcome with a tax authority may result in a tax liability that is more or less than that reflected in the consolidated condensed financial statements. Furthermore, the Company may later decide to challenge any assessments, if made, and may exercise its right to appeal. The uncertain tax positions are reviewed quarterly and adjusted as events occur that affect potential liabilities for additional taxes, such as lapsing of applicable statutes of limitations, proposed assessments by tax authorities, negotiations between tax authorities, identification of new issues and issuance of new legislation, regulations or case law.

        As of June 30, 2014 and December 31, 2013, the liability for income taxes associated with uncertain tax positions was $172.0 million and $127.7 million, respectively. The Company estimates that these liabilities would be reduced by $30.3 million and $30.9 million, respectively, from offsetting tax benefits associated with the correlative effects of potential transfer pricing adjustments, state income taxes and timing adjustments. The net amounts of $141.7 million and $96.8 million, respectively, if not required, would favorably affect the Company's effective tax rate.

        At June 30, 2014, all material state, local and foreign income tax matters have been concluded for years through 2006. During the third quarter of 2013, the Internal Revenue Service ("IRS") completed its fieldwork for the 2009 and 2010 tax years. The case is currently in suspense pending finalization of an Advance Pricing Agreement ("APA") and Joint Committee of Taxation approval. The IRS began its examination of the 2011 and 2012 tax years during the fourth quarter of 2013. The Company has also entered into an APA process between the Switzerland and United States governments for the years 2009 through 2013 covering transfer pricing matters. The transfer pricing matters are significant to the Company's consolidated condensed financial statements, and the final outcome of the negotiations between the two governments is uncertain.

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17.   SEGMENT INFORMATION

        Edwards Lifesciences conducts operations worldwide and is managed in the following geographical regions: United States, Europe, Japan, and Rest of World. All regions sell products that are used to treat advanced cardiovascular disease.

        The Company's geographic segments are reported based on the financial information provided to the Chief Operating Decision Maker (the Chief Executive Officer). The Company evaluates the performance of its geographic segments based on net sales and income before provision for income taxes ("pre-tax income"). The accounting policies of the segments are substantially the same as those described in Note 2 of the Company's consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2013. Segment net sales and segment pre-tax income are based on internally derived standard foreign exchange rates, which may differ from year to year, and do not include inter-segment profits. Because of the interdependence of the reportable segments, the operating profit as presented may not be representative of the geographical distribution that would occur if the segments were not interdependent. Net sales by geographic area are based on the location of the customer.

        Certain items are maintained at the corporate level and are not allocated to the segments. The non-allocated items include net interest expense, global marketing expenses, corporate research and development expenses, manufacturing variances, corporate headquarters costs, special gains and charges, stock-based compensation, foreign currency hedging activities, certain litigation costs and most of the Company's amortization expense. Although most of the Company's depreciation expense is included in segment pre-tax income, due to the Company's methodology for cost build-up, it is impractical to determine the amount of depreciation expense included in each segment, and, therefore, a portion is maintained at the corporate level. The Company neither discretely allocates assets to its operating segments, nor evaluates the operating segments using discrete asset information.

        The table below presents information about Edwards Lifesciences' reportable segments (in millions):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Segment Net Sales
United States	$	242.0	$	240.5	$	464.4	$	468.4
Europe		188.3		160.7		363.9		316.2
Japan		68.2		73.0		128.4		140.3
Rest of World		75.1		63.1		138.8		117.6
Total segment net sales	$	573.6	$	537.3	$	1,095.5	$	1,042.5
Segment Pre-tax Income
United States	$	131.2	$	142.7	$	249.6	$	275.5
Europe		87.7		73.7		167.9		146.2
Japan		31.9		36.9		59.5		70.4
Rest of World		23.7		17.5		40.0		30.0
Total segment pre-tax income	$	274.5	$	270.8	$	517.0	$	522.1

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        The table below presents reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Net Sales Reconciliation
Segment net sales	$	573.6		$	537.3		$	1,095.5		$	1,042.5
Foreign currency		1.5			(20.1	)		2.0			(28.6	)
Consolidated net sales	$	575.1		$	517.2		$	1,097.5		$	1,013.9
Pre-tax Income Reconciliation
Segment pre-tax income	$	274.5		$	270.8		$	517.0		$	522.1
Unallocated amounts:
Corporate items		(158.1	)		(143.3	)		(312.7	)		(283.0	)
Special charges (Note 4)		(50.0	)		—			(57.5	)		—
Intellectual property litigation income (expense), net (Note 3)		747.4			(5.5	)		741.9			72.6
Interest expense, net		(3.1	)		(0.4	)		(6.6	)		(0.2	)
Foreign currency		2.5			(1.1	)		8.4			(0.4	)
Consolidated pre-tax income	$	813.2		$	120.5		$	890.5		$	311.1

Enterprise-Wide Information

        Enterprise-wide information is based on actual foreign exchange rates used in the Company's consolidated condensed financial statements.

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(in millions)
Net Sales by Geographic Area
United States	$	242.0	$	240.5	$	464.4	$	468.4
Europe		193.8		155.3		374.1		309.8
Japan		66.7		59.3		125.4		119.3
Rest of World		72.6		62.1		133.6		116.4
	$	575.1	$	517.2	$	1,097.5	$	1,013.9
Net Sales by Major Product and Service Area
Transcatheter Heart Valves	$	219.7	$	182.1	$	408.9	$	351.8
Surgical Heart Valve Therapy		214.0		204.3		416.6		402.4
Critical Care		141.4		130.8		272.0		259.7
	$	575.1	$	517.2	$	1,097.5	$	1,013.9

	June 30, 2014		December 31, 2013
	(in millions)
Long-lived Tangible Assets by Geographic Area
United States	$	310.7	$	308.2
Europe		41.8		40.9
Japan		10.0		10.8
Rest of World		95.7		97.1
	$	458.2	$	457.0

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Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend the forward-looking statements contained in this report to be covered by the safe harbor provisions of such Acts. All statements other than statements of historical fact in this report or referred to or incorporated by reference into this report are "forward-looking statements" for purposes of these sections. These statements include, among other things, any predictions of earnings, revenues, expenses or other financial items, plans or expectations with respect to development activities, clinical trials or regulatory approvals, any statements of plans, strategies and objectives of management for future operations, any statements concerning our future operations, financial conditions and prospects, and any statements of assumptions underlying any of the foregoing. These statements can sometimes be identified by the use of the forward-looking words such as "may," "believe," "will," "expect," "project," "estimate," "should," "anticipate," "plan," "goal," "continue," "seek," "pro forma," "forecast," "intend," "guidance," "optimistic," "aspire," "confident," other forms of these words or similar words or expressions or the negative thereof. Investors are cautioned not to unduly rely on such forward-looking statements. These forward-looking statements are subject to substantial risks and uncertainties that could cause our results or future business, financial condition, results of operations or performance to differ materially from our historical results or experiences or those expressed or implied in any forward-looking statements contained in this report. Investors should carefully review the information contained in, or incorporated by reference into, our annual report on Form 10-K for the year ended December 31, 2013 and subsequent reports on Forms 10-Q and 8-K for a description of certain of these risks and uncertainties. These forward-looking statements speak only as of the date on which they are made and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of the statement. If we do update or correct one or more of these statements, investors and others should not conclude that we will make additional updates or corrections.

Overview

        We are the global leader in the science of heart valves and hemodynamic monitoring. Driven by a passion to help patients, we partner with clinicians to develop innovative technologies in the areas of structural heart disease and critical care monitoring, enabling them to save and enhance lives. We conduct operations worldwide and are managed in the following geographical regions: United States, Europe, Japan, and Rest of World. Our products are categorized into the following main areas: Surgical Heart Valve Therapy, Transcatheter Heart Valves, and Critical Care.

        Effective January 1, 2014, we changed our method of accounting for certain intellectual property litigation expenses related to the defense and enforcement of issued patents. Under the new method of accounting, these legal costs are expensed in the period incurred; previously, these costs were capitalized and then amortized over the life of the related patent. The financial results below reflect the change in accounting principle. For further information, see Note 2 to the "Consolidated Condensed Financial Statements."

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Financial Results

        The following is a summary of our financial performance (dollars in millions, except per share data):

	Three Months Ended June 30,									Six Months Ended June 30,
	2014			2013			Change			2014			2013			Change
Net sales	$	575.1		$	517.2			11.2	%	$	1,097.5		$	1,013.9			8.2	%
Gross profit as a percentage of net sales		73.7	%		76.1	%		(2.4	) pts.		72.9	%		75.9	%		(3.0	) pts.
Net income	$	547.0		$	93.3			486.3	%	$	607.3		$	237.2			156.0	%
Earnings per share
Basic	$	5.18		$	0.83			524.1	%	$	5.72		$	2.09			173.7	%
Diluted	$	5.09		$	0.81			528.4	%	$	5.63		$	2.05			174.6	%

        Our sales growth was driven by our Transcatheter Heart Valves, primarily in Europe, which benefited from the launch of the Edwards SAPIEN 3 transcatheter heart valve. In connection with the launch of the Edwards SAPIEN XT transcatheter heart valve in the United States and the continued launch of SAPIEN 3 in Europe, our gross profit margin was reduced by the impact from estimated product returns expected in 2014 upon introduction of next-generation transcatheter heart valve products, and weaker currencies. Net income in the first six months of 2014 and 2013 benefited from special items. In the second quarter of 2014, we received $750.0 million ($487.9 million, net of tax), from Medtronic, Inc. ("Medtronic") for an upfront payment due under a litigation settlement agreement, and in the first quarter of 2013, we received from Medtronic an $83.6 million ($52.3 million, net of tax) litigation award.

Healthcare Environment, Opportunities and Challenges

        The medical device industry is highly competitive and continues to evolve. Our success is measured both by the development of innovative products and the value we bring to our stakeholders. We are committed to developing new technologies and providing innovative patient care, and we are committed to defending our intellectual property. To strengthen our leadership and enable future growth opportunities, in the first six months of 2014 we invested 15.9% of our net sales in research and development. In the coming year, we expect increased competition with our Transcatheter Heart Valves as our competitors introduce products in the United States and Europe.

New Accounting Standards

        For information on new accounting standards, see Note 1 to the "Consolidated Condensed Financial Statements."

Results of Operations

Net Sales Trends
(dollars in millions)

	Three Months Ended June 30,									Six Months Ended June 30,
							Percent Change										Percent Change
	2014		2013		Change					2014		2013		Change
United States	$	242.0	$	240.5	$	1.5		0.6	%	$	464.4	$	468.4	$	(4.0	)		(0.9	)%
International		333.1		276.7		56.4		20.4	%		633.1		545.5		87.6			16.1	%
Total net sales	$	575.1	$	517.2	$	57.9		11.2	%	$	1,097.5	$	1,013.9	$	83.6			8.2	%

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        In the United States, the $1.5 million increase and the $4.0 million decrease in net sales for the three and six months ended June 30, 2014, respectively, were due primarily to:

•

Transcatheter Heart Valves, which decreased net sales by $4.1 million and $16.0 million, respectively, due primarily to (1) a reduction in net sales of the Edwards SAPIEN transcatheter heart valve due to net stocking orders as customers convert from direct sales to consignment and (2) an increase to the sales reserve for estimated Transcatheter Heart Valve product returns expected in the second half of 2014 upon introduction of the Edwards SAPIEN XT transcatheter heart valve. This sales reserve is expected to reverse during 2014 as the introduction of the next-generation valves is expected to be substantially completed in 2014. These decreases were partially offset by an increase in clinical sales of the Edwards SAPIEN 3 transcatheter heart valve;

        partially offset by:

•

Critical Care, which increased net sales by $4.4 million and $7.6 million, respectively, due primarily to enhanced surgical recovery products; and

•

Surgical Heart Valves, which increased net sales by $1.2 million and $4.5 million, respectively, driven primarily by sales of pericardial aortic tissue valves and clinical sales of the EDWARDS INTUITY Elite valves.

        International net sales increased $56.4 million and $87.6 million for the three and six months ended June 30, 2014, respectively, due primarily to:

•

Transcatheter Heart Valves, which increased net sales by $37.0 million and $66.7 million, respectively, driven primarily by the launch of the Edwards SAPIEN 3 transcatheter heart valve in Europe and the ongoing launch of the Edwards SAPIEN XT transcatheter heart valve in Japan;

•

Surgical Heart Valves, which increased net sales by $7.7 million and $12.7 million, respectively, driven primarily by sales of pericardial aortic tissue valves;

•

Critical Care, which increased net sales by $6.7 million and $9.3 million, respectively, driven primarily by core hemodynamic products and enhanced surgical recovery products; and

•

foreign currency exchange rate fluctuations, which increased net sales for the three months ended June 30, 2014 by $4.8 million due primarily to the strengthening of the Euro against the United States dollar, partially offset by the weakening of the Japanese yen against the United States dollar. Foreign currency exchange rate fluctuations did not have a significant impact to total net sales for the six months ended June 30, 2014.

        The impact of foreign currency exchange rate fluctuations on net sales is not necessarily indicative of the impact on net income due to the corresponding effect of foreign currency exchange rate fluctuations on international manufacturing and operating costs and our hedging activities. For more information, see Item 3, "Quantitative and Qualitative Disclosures About Market Risk."

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Net Sales by Product Group
(dollars in millions)

	Three Months Ended June 30,									Six Months Ended June 30,
							Percent Change									Percent Change
	2014		2013		Change					2014		2013		Change
Transcatheter Heart Valves	$	219.7	$	182.1	$	37.6		20.6	%	$	408.9	$	351.8	$	57.1		16.2	%
Surgical Heart Valve Therapy		214.0		204.3		9.7		4.8	%		416.6		402.4		14.2		3.6	%
Critical Care		141.4		130.8		10.6		8.1	%		272.0		259.7		12.3		4.7	%
Total net sales	$	575.1	$	517.2	$	57.9		11.2	%	$	1,097.5	$	1,013.9	$	83.6		8.2	%

Transcatheter Heart Valves

        The $37.6 million and $57.1 million increases in net sales of Transcatheter Heart Valves for the three and six months ended June 30, 2014, respectively, were due primarily to:

•

the Edwards SAPIEN 3 transcatheter heart valve, driven primarily by the launch in Europe; and

•

the ongoing launch of the Edwards SAPIEN XT transcatheter heart valve in Japan;

        partially offset by:

•

the Edwards SAPIEN transcatheter heart valve, primarily in the United States, due to a reduction in net stocking orders as customers convert from direct sales to consignment, and an increase to the sales reserve for estimated Transcatheter Heart Valve product returns expected in the second half of 2014 upon introduction of the Edwards SAPIEN XT transcatheter heart valve in the United States.

        During the first quarter of 2014, we completed enrollment in the 500 patient cohort of The PARTNER II Trial studying the Edwards SAPIEN 3 transcatheter valve system in high risk and inoperable patients. In January 2014, we received United States Food and Drug Administration ("FDA") approval to expand The PARTNER II Trial to include a 1,000 patient single-arm, non-randomized cohort to study the Edwards SAPIEN 3 transcatheter valve system in the treatment of intermediate risk patients with severe symptomatic aortic stenosis. In January 2014, we also received CE Mark for the Edwards SAPIEN 3 transcatheter valve system in Europe and immediately commenced a launch. In June 2014, we received FDA approval for the Edwards SAPIEN XT transcatheter heart valve in the United States for the treatment of high-risk and inoperable patients with severe symptomatic aortic stenosis.

Surgical Heart Valve Therapy

        The $9.7 million and $14.2 million increases in net sales of Surgical Heart Valve Therapy products for the three and six months ended June 30, 2014, respectively, were due primarily to surgical heart valve products, which increased net sales by $8.8 million and $17.3 million, respectively, driven by sales in the United States and Europe of pericardial aortic tissue valves and EDWARDS INTUITY Elite valves.

        In April 2014, we received CE Mark for our advanced EDWARDS INTUITY Elite valve system. This next-generation, rapid deployment system facilitates smaller incisions in surgical aortic valve replacement procedures. In the United States, we continued enrolling patients in our TRANSFORM Trial for EDWARDS INTUITY Elite, and our COMMENCE clinical trial, which is studying our next-generation GLX tissue treatment platform applied to the Magna Ease aortic surgical valve and the Magna Mitral Ease valve.

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Critical Care

        The $10.6 million and $12.3 million increases in net sales of Critical Care products during the three and six months ended June 30, 2014, respectively, were due primarily to enhanced surgical recovery products and core hemodynamic products outside the United States, partially offset by foreign currency exchange rate fluctuations, which decreased net sales by $0.5 million and $4.5 million, respectively, due primarily to the weakening of the Japanese yen against the United States dollar. In June 2014, we received FDA clearance for the ClearSight system, a noninvasive monitor that provides clinicians access to blood volume and blood flow information for patients at moderate or high risk of post-surgical complications, in whom invasive monitoring would not be used. The ClearSight system is part of our enhanced surgical recovery product portfolio.

Gross Profit

	Three Months Ended June 30,									Six Months Ended June 30,
	2014			2013			Change			2014			2013			Change
Gross profit as a percentage of net sales		73.7	%		76.1	%		(2.4	) pts.		72.9	%		75.9	%		(3.0	) pts.

        The percentage point decrease in gross profit for the three and six months ended June 30, 2014 was driven primarily by (1) the impact of foreign currency exchange rate fluctuations, including the settlement of foreign currency hedging contracts, and (2) the impact from the transcatheter heart valve sales return reserve and related inventory write-off, primarily in the United States, in connection with our SAPIEN 3 and SAPIEN XT launches.

Selling, General and Administrative ("SG&A") Expenses
(dollars in millions)

	Three Months Ended June 30,									Six Months Ended June 30,
	2014			2013			Change			2014			2013			Change
SG&A expenses	$	215.5		$	186.6		$	28.9		$	412.7		$	369.0		$	43.7
SG&A expenses as a percentage of net sales		37.5	%		36.1	%		1.4	pts.		37.6	%		36.4	%		1.2	pts.

        The increase in SG&A expenses for the three and six months ended June 30, 2014 was due primarily to (1) higher sales and marketing expenses in the United States, Europe, and Japan, mainly to support the Transcatheter Heart Valve program, and (2) a larger accrual for incentive compensation.

Research and Development Expenses
(dollars in millions)

	Three Months Ended June 30,									Six Months Ended June 30,
	2014			2013			Change			2014			2013			Change
Research and development expenses	$	89.1		$	80.5		$	8.6		$	174.9		$	160.3		$	14.6
Research and development expenses as a percentage of net sales		15.5	%		15.6	%		(0.1)	pts.		15.9	%		15.8	%		0.1	pts.

        The increase in research and development expenses for the three and six months ended June 30, 2014 was due primarily to additional investments in clinical studies in the Surgical Heart Valve and Transcatheter Heart Valve programs, new mitral Transcatheter Heart Valve product development efforts, and a larger accrual for incentive compensation.

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Intellectual Property Litigation (Income) Expense, Net

        In May 2014, we entered into an agreement with Medtronic to settle all outstanding patent litigation between the companies, including all cases related to transcatheter heart valves. Pursuant to the agreement, we received an upfront payment from Medtronic in the amount of $750.0 million. For further information, see Note 3 and Note 13 to the "Consolidated Condensed Financial Statements."

        We incurred external legal costs related to intellectual property litigation of $2.6 million and $5.5 million for the three months ended June 30, 2014 and 2013, respectively, and $8.1 million and $11.0 million for the six months ended June 30, 2014 and 2013, respectively.

        In February 2013, we received $83.6 million from Medtronic in satisfaction of the initial April 2010 jury award of damages for infringement of the United States Andersen transcatheter heart valve patent, including accrued interest. For further information, see Note 13 to the "Consolidated Condensed Financial Statements."

Special Charges

Charitable Foundation Contribution

        In June 2014, we contributed $50.0 million to the Edwards Lifesciences Foundation, a related-party not-for-profit organization intended to provide philanthropic support to health- and community-focused charitable organizations. The contribution was irrevocable and was recorded as an expense at the time of payment.

Settlement

        In March 2014, we recorded a $7.5 million charge to settle past and future obligations related to one of our intellectual property agreements.

Interest Expense, net
(in millions)

	Three Months Ended June 30,									Six Months Ended June 30,
	2014			2013			Change			2014			2013			Change
Interest expense	$	4.4		$	1.4		$	3.0		$	9.0		$	2.8		$	6.2
Interest income		(1.3	)		(1.0	)		(0.3	)		(2.4	)		(2.6	)		0.2
Interest expense, net	$	3.1		$	0.4		$	2.7		$	6.6		$	0.2		$	6.4

        The increase in interest expense for the three and six months ended June 30, 2014 resulted primarily from a higher average debt balance as compared to the prior year period, and higher average interest rates due to the issuance in October 2013 of $600.0 million of 2.875% fixed-rate unsecured senior notes.

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Other Expense, net
(in millions)

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Foreign exchange losses, net	$	1.3		$	0.3		$	1.1		$	1.2
(Gain) loss on investments in unconsolidated affiliates		(0.9	)		(0.2	)		2.6			—
Insurance settlement gain		—			—			(3.7	)		—
Other		—			—			0.1			0.1
Other expense, net	$	0.4		$	0.1		$	0.1		$	1.3

        The foreign exchange losses relate to the foreign currency fluctuations in our global trade and intercompany receivable and payable balances, offset by the gains and losses on derivative instruments intended as an economic hedge of those exposures.

        The (gain) loss on investments in unconsolidated affiliates primarily represents our net share of gains and losses in investments accounted for under the equity method, and realized gains and losses on our available-for-sale and cost method investments. During the six months ended June 30, 2014, we recorded an other-than-temporary impairment charge of $3.5 million related to one of our cost method investments, and we recorded a $1.4 million gain related to a distribution we received from one of our equity method investments.

        In March 2014, we recorded a $3.7 million insurance settlement gain related to inventory that was damaged in the fourth quarter of 2013.

Provision for Income Taxes

        The provision for income taxes consists of provisions for federal, state and foreign income taxes. We operate in an international environment with significant operations in various locations outside the United States, which have statutory tax rates lower than the United States tax rate. Accordingly, the consolidated income tax rate is a composite rate reflecting the earnings in the various locations and the applicable rates. Our effective income tax rates were 32.7% and 22.6% for the three months ended June 30, 2014 and 2013, respectively, and 31.8% and 23.8% for the six months ended June 30, 2014 and 2013, respectively.

        The effective tax rate for the three and six months ended June 30, 2014 included (1) $262.1 million of tax expense associated with a $750.0 million litigation settlement payment received from Medtronic in May 2014 (see Note 3 to the "Consolidated Condensed Financial Statements"), and (2) $6.2 million of tax benefits from the remeasurement of uncertain tax positions.

        The federal research credit expired on December 31, 2013 and has not been reinstated as of June 30, 2014. Therefore, the effective income tax rates for the three and six months ended June 30, 2014 were calculated without an assumed benefit for the federal research credit. In 2013, the federal research credit related to 2013 favorably impacted the effective tax rate by approximately 1.3%. The effective income tax rate for the six months ended June 30, 2013 included (1) an $8.4 million benefit for the full year 2012 federal research credit, which was reinstated on January 2, 2013, and (2) $31.3 million of tax expense associated with the $83.6 million litigation award received from Medtronic in February 2013 (see Note 3 to the "Consolidated Condensed Financial Statements").

        We strive to resolve open matters with each tax authority at the examination level and could reach agreement with a tax authority at any time. While we have accrued for matters we believe are more likely than not to require settlement, the final outcome with a tax authority may result in a tax liability

29

that is more or less than that reflected in the consolidated financial statements. Furthermore, we may later decide to challenge any assessments, if made, and may exercise our right to appeal. The uncertain tax positions are reviewed quarterly and adjusted as events occur that affect potential liabilities for additional taxes, such as lapsing of applicable statutes of limitations, proposed assessments by tax authorities, negotiations between tax authorities, identification of new issues and issuance of new legislation, regulations or case law. Management believes that adequate amounts of tax and related penalty and interest have been provided in income tax expense for any adjustments that may result from these uncertain tax positions. For further information, see Note 16 to the "Consolidated Condensed Financial Statements."

Liquidity and Capital Resources

        Our sources of cash liquidity include cash and cash equivalents, short-term investments, amounts available under credit facilities, and cash from operations. We believe that these sources are sufficient to fund the current requirements of working capital, capital expenditures and other financial commitments for the next twelve months. However, we periodically consider various financing alternatives and may, from time to time, seek to take advantage of favorable interest rate environments or other market conditions. We believe that we have the financial flexibility to attract long-term capital to fund short-term and long-term growth objectives. However, no assurances can be given that such long-term capital will be available to us on favorable terms, or at all.

        We believe that cash held in the United States, in addition to amounts available under credit facilities and cash from operations, are sufficient to fund our United States operating requirements. Cash and cash equivalents and short-term investments held outside the United States have historically been used to fund international operations and acquire businesses outside of the United States, although a portion of those amounts may from time to time be subject to temporary intercompany loans into the United States. As of June 30, 2014, cash and cash equivalents and short-term investments held outside the United States were $767.6 million. The majority of cash and cash equivalents and short-term investments held outside the United States relates to undistributed earnings of certain of our foreign subsidiaries which are considered by us to be indefinitely reinvested. Repatriations of cash and cash equivalents and short-term investments held outside the United States are subject to restrictions in certain jurisdictions and may be subject to withholding and other taxes. The potential tax liability related to any repatriation would be dependent on the facts and circumstances that exist at the time such repatriation is made and the complexities of the tax laws of the United States and the respective foreign jurisdictions.

        We have a Four-Year Credit Agreement ("Credit Facility") which provides up to an aggregate of $750.0 million in borrowings in multiple currencies. As of June 30, 2014, there were no borrowings outstanding under the Credit Facility. In July 2014, we entered into a new Five-Year Credit Agreement ("Credit Agreement") which matures on July 18, 2019, and the existing Credit Facility was terminated. The Credit Agreement provides up to an aggregate of $750.0 million in borrowings in multiple currencies. We may increase the amount available under the Credit Agreement, subject to agreement of the lenders, by up to an additional $250.0 million in the aggregate. For further information, see Note 8 to the "Consolidated Condensed Financial Statements." In October 2013, we issued $600.0 million of 2.875% fixed-rate unsecured senior notes due October 15, 2018. As of June 30, 2014, the total carrying value of our long-term debt was $598.0 million.

        From time to time, we repurchase shares of our common stock under share repurchase programs authorized by the Board of Directors. We consider several factors in determining when to execute share repurchases, including, among other things, expected dilution from stock plans, cash capacity, and the market price of our common stock. The current $750.0 million program provides for repurchases through December 31, 2016. During 2014, we repurchased a total of 4.4 million shares under the program at an aggregate cost of $300.0 million, and as of June 30, 2014, had remaining authority to

30

purchase $202.5 million of our common stock. In July 2014, the Board of Directors approved a new stock repurchase program providing for an additional $750.0 million of repurchases of our common stock.

        At June 30, 2014, there had been no material changes in our significant contractual obligations and commercial commitments as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2013.

        Net cash flows provided by operating activities of $916.9 million for the six months ended June 30, 2014 increased $687.7 million over the same period last year due primarily to (1) the $750.0 million upfront payment received from Medtronic under a litigation settlement agreement, and (2) the $37.6 million impact from excess tax benefits from stock plans as compared to the prior year, primarily as a result of the prior year realization of excess tax benefits that had been previously unrealized due to credit carryforwards and net operating losses in the United States in 2011. These increases were partially offset by (1) the prior year receipt of $83.6 million from Medtronic in satisfaction of the initial April 2010 jury award of damages for infringement of the United States Andersen transcatheter heart valve patent, and (2) the $50.0 million charitable contribution to the Edwards Lifesciences Foundation.

        Net cash used in investing activities of $590.2 million for the six months ended June 30, 2014 consisted primarily of net purchases of investments of $561.2 million and capital expenditures of $30.3 million.

        Net cash used in investing activities of $59.3 million for the six months ended June 30, 2013 consisted primarily of capital expenditures of $66.3 million, partially offset by net proceeds from investments of $7.1 million.

        Net cash used in financing activities of $247.6 million for the six months ended June 30, 2014 consisted primarily of purchases of treasury stock of $300.6 million, partially offset by proceeds from stock plans of $32.9 million, and the excess tax benefit from stock plans of $21.3 million (including the realization of previously unrealized excess tax benefits).

        Net cash used in financing activities of $114.2 million for the six months ended June 30, 2013 consisted primarily of purchases of treasury stock of $246.6 million, partially offset by the excess tax benefit from stock plans of $58.9 million (including the realization of previously suspended excess tax benefits), net proceeds from debt of $40.2 million, and proceeds from stock plans of $27.4 million.

Critical Accounting Policies and Estimates

        The consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. Information with respect to our critical accounting policies and estimates which we believe could have the most significant effect on our reported results and require subjective or complex judgments by management is contained on pages 36-39 in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," of our Annual Report on Form 10-K for the year ended December 31, 2013. There have been no significant changes from the information discussed therein.

31

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk, Foreign Currency Risk, Credit Risk and Concentrations of Risk

        For a complete discussion of our exposure to interest rate risk, foreign currency risk, credit risk and concentrations of risk, refer to Item 7A "Quantitative and Qualitative Disclosures About Market Risk" on pages 39-41 of our Annual Report on Form 10-K for the year ended December 31, 2013. There have been no significant changes from the information discussed therein.

Investment Risk

        We are exposed to investment risks related to changes in the fair values of our investments. Our investments include short-term and long-term investments in fixed interest rate securities and time deposits, and investments in equity instruments of public and private companies. See Note 6 to the "Consolidated Condensed Financial Statements" for additional information on our investments.

        As of June 30, 2014, we had $1,066.4 million of investments in time deposits and fixed interest rate securities designated as held-to-maturity, of which $80.9 million were long-term. The market value of these investments varies inversely with changes in current market interest rates. Our intent is to hold these investments to maturity so that they can be redeemed at their stated or face value. However, should we be forced to sell securities that have declined in market value prior to their maturity, we may suffer losses in principal. In addition, we had $18.1 million of investments in equity instruments of other companies and had recorded unrealized gains of $0.4 million on these investments in "Accumulated Other Comprehensive Loss," net of tax. Should these companies experience a decline in financial condition or fail to meet certain development milestones, the decline in the investments' value may be considered other-than-temporary and impairment charges may be necessary.

Item 4.    Controls and Procedures

        Evaluation of Disclosure Controls and Procedures.    Our management, including the Chief Executive Officer and the Chief Financial Officer, performed an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of June 30, 2014. Based on their evaluation, the Chief Executive Officer and Chief Financial Officer have concluded as of June 30, 2014 that our disclosure controls and procedures are effective in providing reasonable assurance that the information we are required to disclose in the reports we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. There have been no changes in our internal controls over financial reporting during the quarter ended June 30, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

32

Part II. Other Information

Item 1.    Legal Proceedings

        For a description of our material pending legal proceedings, please see Note 13 to the "Consolidated Condensed Financial Statements" of this Quarterly Report on Form 10-Q, which is incorporated by reference.

Item 1A.    Risk Factors

        There have been no material changes to the risk factors under Part I, Item 1A "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2013.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

Period	Total Number of Shares (or Units) Purchased(a)		Average Price Paid per Share (or Unit)		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (in millions)(b)
April 1, 2014 through April 30, 2014		437	$	74.58		—	$	202.5
May 1, 2014 through May 31, 2014		6,855		85.83		—		202.5
June 1, 2014 through June 30, 2014		—		—		—		202.5
Total		7,292		85.15		—

(a)

The difference between the total number of shares (or units) purchased and the total number of shares (or units) purchased as part of publicly announced plans or programs is due to shares withheld by us to satisfy tax withholding obligations in connection with the vesting of restricted stock units issued to employees.

(b)

On May 14, 2013, the Board of Directors approved a stock repurchase program authorizing us to purchase on the open market, including pursuant to a Rule 10b5-1 plan, and in privately negotiated transactions up to $750.0 million of our common stock from time to time until December 31, 2016. On July 10, 2014, the Board of Directors approved a new stock repurchase program providing for an additional $750.0 million of repurchases of our common stock.

Item 6.    Exhibits

        Exhibits required by Item 601 of Regulation S-K are listed in the Exhibit Index hereto and include the following:

10.1

Five-Year Credit Agreement, dated as of July 18, 2014, among Edwards Lifesciences and certain of its subsidiaries, as Borrowers; the lenders signatory thereto, Bank of America, N.A., as Administrative Agent, Swing Line Lender and Issuing Bank; JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents, and Deutsche Bank Securities Inc., HSBC Bank USA, National Association, PNC Bank, National Association, The Bank of Tokyo-Mitsubishi UFJ, Ltd., and U.S. Bank National Association, as Co-Documentation Agents (incorporated by reference to Exhibit 10.1 in Edwards Lifesciences' report on Form 8-K, filed July 24, 2014)

+10.2

Settlement Agreement, dated May 19, 2014, between Edwards Lifesciences and Medtronic, Inc.

33

*10.3	Amended and Restated Long-Term Stock Incentive Compensation Program (incorporated by reference to Appendix A to Edwards' Definitive Proxy Statement, filed March 28, 2014, under the Securities Exchange Act of 1934)
*10.4	Amended and Restated 2001 Employee Stock Purchase Plan for International Employees (incorporated by reference to Appendix B to Edwards' Definitive Proxy Statement, filed March 28, 2014, under the Securities Exchange Act of 1934)
31.1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification 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 from Edwards Lifesciences' Quarterly Report on Form 10-Q for the quarter ended June 30, 2014, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Condensed Balance Sheets, (ii) the Consolidated Condensed Statements of Operations, (iii) the Consolidated Condensed Statements of Comprehensive Income, (iv) the Consolidated Condensed Statements of Cash Flows, and (v) Notes to Consolidated Condensed Financial Statements

+

Pursuant to a request for confidential treatment, confidential portions of this exhibit have been redacted and have been filed separately with the Securities and Exchange Commission

*

Represents management contract or compensatory plan

34

SIGNATURE

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	EDWARDS LIFESCIENCES CORPORATION (Registrant)
Date: August 4, 2014	By:	/s/ SCOTT B. ULLEM Scott B. Ullem Corporate Vice President, Chief Financial Officer (Principal Financial Officer)
Date: August 4, 2014	By:	/s/ ROBERT W.A. SELLERS Robert W.A. Sellers Vice President, Corporate Controller (Principal Accounting Officer)

35

EXHIBITS FILED WITH SECURITIES AND EXCHANGE COMMISSION

Exhibit No.		Description
	10.1	Five-Year Credit Agreement, dated as of July 18, 2014, among Edwards Lifesciences and certain of its subsidiaries, as Borrowers; the lenders signatory thereto, Bank of America, N.A., as Administrative Agent, Swing Line Lender and Issuing Bank; JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents, and Deutsche Bank Securities Inc., HSBC Bank USA, National Association, PNC Bank, National Association, The Bank of Tokyo-Mitsubishi UFJ, Ltd., and U.S. Bank National Association, as Co-Documentation Agents (incorporated by reference to Exhibit 10.1 in Edwards Lifesciences' report on Form 8-K, filed July 24, 2014)
	+10.2	Settlement Agreement, dated May 19, 2014, between Edwards Lifesciences and Medtronic, Inc.
	*10.3	Amended and Restated Long-Term Stock Incentive Compensation Program (incorporated by reference to Appendix A to Edwards' Definitive Proxy Statement, filed March 28, 2014, under the Securities Exchange Act of 1934)
	*10.4	Amended and Restated 2001 Employee Stock Purchase Plan for International Employees (incorporated by reference to Appendix B to Edwards' Definitive Proxy Statement, filed March 28, 2014, under the Securities Exchange Act of 1934)
	31.1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	31.2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	32	Certification 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 from Edwards Lifesciences' Quarterly Report on Form 10-Q for the quarter ended June 30, 2014, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Condensed Balance Sheets, (ii) the Consolidated Condensed Statements of Operations, (iii) the Consolidated Condensed Statements of Comprehensive Income, (iv) the Consolidated Condensed Statements of Cash Flows, and (v) Notes to Consolidated Condensed Financial Statements

+

Pursuant to a request for confidential treatment, confidential portions of this exhibit have been redacted and have been filed separately with the Securities and Exchange Commission

*

Represents management contract or compensatory plan

36

EX-10.2

Exhibit 10.2

FOIA CONFIDENTIAL TREATMENT REQUESTED

SETTLEMENT AGREEMENT

This Settlement Agreement (“Agreement”), by and between Edwards Lifesciences Corporation, on its own behalf and on behalf of its respective Affiliates (as defined below) (collectively “Edwards”), and Medtronic, Inc., on its own behalf and on behalf of its respective Affiliates (as defined below) (collectively “Medtronic”), is entered into and effective on May 19, 2014 (“Effective Date”).  Edwards and Medtronic are each individually a “Party” to this Agreement and are collectively referred to in this Agreement as the “Parties.”

RECITALS

WHEREAS, Edwards is engaged in the manufacture and sale of products in the TAVI Field (as defined below), including Edwards’ SAPIEN, SAPIEN XT, SAPIEN 3, and CENTERA products;

WHEREAS, Medtronic is engaged in the manufacture and sale of products in the TAVI Field (as defined below), including Medtronic’s CoreValve, Evolut, Evolut R, and Engager products;

WHEREAS, there are and have been pending various cases and controversies between Edwards and Medtronic in the patent field;

WHEREAS, Edwards and Medtronic wish to resolve the cases and controversies between them under the terms and conditions specified below;

NOW, THEREFORE, intending to be legally bound, in consideration of the foregoing premises and of the mutual promises herein contained, the Parties agree as follows:

1CERTAIN DEFINITIONS

1.1“Affiliate” means any Enterprise which, now or hereafter, directly or indirectly owns, is owned by, or is under common ownership of a Party.  “Owned” for purposes of determining Affiliates means ownership or control of more than fifty percent (50%) (or any lesser percentage which is the maximum allowed, by law, to be owned by an Enterprise in a particular jurisdiction) of the equity or other ownership interest having the power to vote on or direct the affairs of such Enterprise.  Affiliates include any Enterprise that first becomes an Affiliate after the date of this Agreement unless specifically excluded.  Any such Enterprise ceases to be an Affiliate when it is no longer owned by or under common ownership of a Party.

1.2“Andersen Patents” means United States Patent Nos. 5,411,552, 5,840,081, 6,168,614, 6,582,462, 7,618,446, and 7,789,909; their Counterparts and Related Patents, including all worldwide patents and patent applications claiming priority to Danish patent application No. 1246/90, filed on May 18, 1990.

1.3“Change of Control” of a Party means the occurrence of any of the following events:

a)a sale or separation (e.g., spin-off or initial public offering) of all or substantial portion of the assets of such Party in a single transaction or in a series of related transactions; or

b)a liquidation or dissolution of such Party; or

c)a merger or consolidation involving such Party after the completion of which: (i) in the case of a merger (other than a triangular merger) or a consolidation, the shareholders immediately prior to the completion of such merger or consolidation beneficially own, directly or indirectly, outstanding voting securities representing equal to or less than fifty percent (50%) of the combined voting power of the surviving entity in such merger or consolidation, and (ii) in the case of a triangular merger, the shareholders immediately prior to the completion of such merger beneficially own, directly or indirectly, outstanding voting securities representing equal to or less than fifty percent (50%) of the combined voting power of the parent of the surviving entity in such merger; or

d)an acquisition by any person, entity or “group”, including in a merger or consolidation of the type referred to in clause “(c)” of this definition, of beneficial ownership of outstanding voting securities representing more than fifty percent (50%) or more of the combined voting power (in a single transaction or series of transactions).

1.4[*]

1.5“Counterpart” of a referenced patent or patent application in a given country means a patent or patent application in another country owned or controlled by a Party that claims priority to the referenced patent or patent application, or to a patent application to which the referenced patent or patent application claims priority.

1.6 “Covenant Patents” means all patents and patent applications, including Counterparts and Related Patents to such patents and patent applications, owned or controlled by either Medtronic or Edwards at any time during the Covenant Term covering subject matter within the Non-Aortic Field and/or the TAVI Field, including patents and patent applications that are acquired after the Effective Date and patents and patent applications that are sold or exclusively licensed out by Medtronic or Edwards during the Covenant Term.

1.7“Covenant Term” means the period beginning on the Effective Date and lasting for eight (8) years.

1.8“Cribier Patents” means United States Patent Nos. 6,908,481, 7,585,321, 7,846,203, 7,846,204, 8,002,825, 8,057,540, and 8,591,575; their Counterparts and Related Patents, including all worldwide patents and patent applications claiming priority to European patent application No. EP 96402929.2, filed on December 31, 1996, and/or PCT/EP97/07337, filed on December 31, 1997.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

2

1.9“Edwards Licensed Patents” means Edwards TAVI Patents and Edwards Surgical Patents, collectively.

1.10“Edwards Products” means current and future Edwards TAVI Products including SAPIEN, SAPIEN XT, SAPIEN 3, and CENTERA products.

1.11“Edwards Reexaminations” means all ex parte or inter partes reexaminations before the United States Patent and Trademark Office (“PTO”) of U.S. Patent Nos. 6,004,330, 6,306,141, 7,468,073, 7,503,929, 7,691,143, 7,892,281, 8,070,801, 8,163,009, and 8,623,077.

1.12“Edwards Surgical Patents” means United States Patent Nos. 6,749,630, 8,114,155, 8,123,800, 6,908,482, and 7,367,991; their Counterparts and Related Patents, including all worldwide patents and patent applications claiming priority to U.S. patent application No. 09/941,406, filed on August 28, 2001, and/or U.S. patent application No. 10/139,070, filed on May 3, 2002.

1.13“Edwards TAVI Patents” means Andersen Patents, Cribier Patents, and Spenser Patents, collectively.

1.14“Engager Products” means current and future versions of Medtronic’s Engager product.

1.15“Enterprise” means any individual or a group of individuals, or a partnership, firm, association, company, corporation or other business or legal entity.

1.16“Fiscal Quarters” means each three-month period ending at the date of Medtronic’s month-end close for the months of January, April, July, and October.

1.17“Have Manufactured” a product means for a Party to have that product made by a Third Party manufacturer solely for (and solely for sale to) the Party, for resale, directly or through a distributor, to end users by that Party, provided that such Party has developed or acquired the designs, specifications, schematics, and the like for such product.  In no event shall a Have Manufactured right have the effect of a sub-license.

1.18[*]

1.19“Manufacture … in the United States” a Medtronic Product means (a) to manufacture a product in the United States or (b) [*].

1.20“Medtronic Licensed Patents” means Medtronic TAVI Patents, Medtronic Surgical Patents, and [*], collectively.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

3

1.21“Medtronic Products” means current and future Medtronic TAVI Products including CoreValve, Evolut, and Evolut R products, other than Engager Products.

1.22“Medtronic Reexaminations” means all ex parte or inter partes reexaminations before the PTO of U.S. Patent Nos. 5,411,552, 6,582,462, 7,618,446, and 7,789,909.

1.23“Medtronic Surgical Patents” means United States Patent Nos. 7,503,929, 7,468,073, 7,189,258, 7,033,390, 7,722,626, 6,986,774, 6,447,523, 6,004,330, 5,904,690, 5,820,628, 5,749,879, 5,720,754, 5,632,746, 5,601,572, 5,509,923, 5,486,183, RE42,395; their Counterparts and Related Patents, including all worldwide patents and patent applications claiming priority to U.S. patent application No. 60/345,296, filed on January 2, 2002, and/or U.S. patent application No. 06/316,203, filed on October 29, 1981, U.S. patent application No. 08/398,629, filed on March 3, 1995, and/or U.S. patent application No. 07/774,016, filed on October 9, 1991.

1.24“Medtronic TAVI Patents” means Pacing Patents and Seguin Patents, collectively.

1.25 “Net Sales” means the gross invoice price charged by Medtronic to a Third Party for a commercial sale of a Medtronic Product less the following items, but only to the extent that they actually pertain to the disposition of such Medtronic Product and are identified separately on a bill, invoice, or other documentation:  (a) allowances actually granted to customers for rejections, returns, or prompt payment and volume discounts; (b) freight, transport packing, and insurance charges associated with transportation to the extent that such items are included in the gross amount invoiced; and (c) rebates or discounts paid or credited pursuant to applicable law.  If Medtronic bundles Medtronic Product with other products, Medtronic will reasonably allocate the gross price charged between the Medtronic Products and other products for purposes of calculating Net Sales, consistent with Medtronic’s standard accounting policies governing allocations of bundled product sales.

1.26“Non-Aortic Field” means the field of catheter delivered non-aortic heart valves, whether delivered transvascularly, transaortic, subclavian or transapically or otherwise, without removal of the patient’s native heart valve, and directly related accessories, including by way of illustration, crimping devices for loading the valves on catheters, catheters, guidewires, delivery systems, introducer systems such as sheaths, closure systems and pacing protocols.

1.27“OEM Basis” means the manufacture and sale of any product to any Third Party for (a) incorporation into or sale with or as such other Third Party’s product, or (b) the resale of such Third Party’s product, as the case may be, by such Third Party under trademarks owned by the Third Party, although a Party may bundle its products with the products of a Third Party so long as such Third Party’s trademarks are not prominently displayed in conjunction with such bundle.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

4

1.28“Pacing Patents” means United States Patent Nos. 6,006,134, 6,266,564, 6,449,507, 6,532,388, 6,542,774, 6,628,987, 6,718,208, 6,735,471, 6,904,318, 6,912,419, 7,184,829, 7,225,019, 7,269,457, 7,697,984, 7,711,421, and 8,036,741; their Counterparts and Related Patents, including all worldwide patents and patent applications claiming priority to U.S. patent application No. 10/768,999, filed on January 30, 2004, and/or U.S. patent application No. 12/557,950, filed on September 11, 2009.

1.29“Pending Cases” means the following cases, and all appeals from, challenges to, and/or review sought of, the following cases:  (a) Edwards Lifesciences AG v. CoreValve, Inc., Civ. A. No. 08-091 (GMS) (D. Del.); (b) Edwards Lifesciences AG v. Medtronic, Inc., Civ. A. No. 09-873 (GMS) (D. Del.); (c) Edwards Lifesciences LLC v. Medtronic CoreValve LLC, Civ. A. No. 12-23 (GMS) (D. Del.); (d) Medtronic CoreValve LLC v. Edwards Lifesciences Corp., Civ. A. No. SACV11 00961 JVS (C.D. Cal.); (e) Medtronic, Inc. v. Edwards Lifesciences Corp., Civ. A. No. SACV12 00327 JVS (C.D. Cal.); (f) Medtronic, Inc. v. Edwards Lifesciences Corp., No. 11-cv-1650 JNE/JSM (D. Minn.); (g) German Infringement proceedings re: EP 2 000 115, pending at Court of Appeals Karlsruhe; (h) German Infringement proceedings re: EP 2 055 266, pending at Court of Appeals Karlsruhe; and (i) German Infringement proceedings re: EP 2 260 796, pending at District Court Mannheim.

1.30“Pending Proceedings” means (a) proceedings before the European Patent Office (“EPO”) concerning the following patents:  EP1621162, EP2000115, EP2260798, EP2260797, EP2260796, EP1603493, EP2241287, EP1441672, EP2055266, EP2399549, EP1951153, and EP1803421; (b) Edwards Reexaminations; (c) Medtronic Reexaminations; (d) proceedings before the PTO and the United States Food and Drug Administration (“FDA”) concerning patent term extension of U.S. Patent No. 5,411,552; (e) the proceeding before the Australian Patent Office (“APO”) concerning Australian patent No. 2008 221 540; and (f) any appeals from, challenges to, and/or review sought of, the proceedings referenced in this sentence.

1.31“Regulatory Authority” means a federal, national, multinational, state, provincial or local regulatory agency, department, bureau, or other governmental entity with authority over the testing, manufacture, use, storage, import, promotion, marketing, or sale of a product in a country or territory.

1.32“Related Patent” of a referenced patent or patent application means a patent or patent application owned or controlled by a Party, which (a) in the case of a U.S. patent or patent application is a parent, continuation, continuation-in-part, division, reissue, reexamination, extension, renewal, or the like, of the referenced patent or patent application, or (b) in the case of a foreign patent or patent application is any patent or patent application corresponding to such terminology, or (c) otherwise claims priority from any application from which the referenced patent or patent application also claims priority.

1.33“Royalty Term” means the period from and including the Effective Date to and including April 9, 2022.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

5

1.34“Royalty Years” mean the periods from the Effective Date to the first anniversary of the Effective Date, and annually thereafter through the expiration of the Royalty Term.

1.35“Seguin Patents” means United States Patent Nos. 6,830,584, 7,018,406, 7,252,682, 7,329,278, 7,682,390, 7,780,726, 7,892,281, 8,002,826, 8,016,877, 8,579,966, 8,603,159, and 8,628,570; their Counterparts and Related Patents, including all worldwide patents and patent applications claiming priority to French patent application FR 99/14462, filed on November 17, 1999, and/or French patent application FR 00/14028, filed on October 31, 2000.

1.36“Spenser Patents” means United States Patent Nos. 6,730,118, 6,893,460, 7,393,360, 7,510,575, and 8,632,586; their Counterparts and Related Patents, including all worldwide patents and patent applications claiming priority to U.S. patent application No. 09/975,750, filed on October 11, 2001.

1.37[*]

1.38“Surgical Field” means the fields of intra-aortic filtering, surgical heart valve repair, and surgical heart valve replacement (with the removal of the patient’s native heart valve in the case of heart valve replacement).

1.39“TAVI Accessories” means accessories related to the procedure of implanting TAVI Products, including by way of illustration, crimping devices for loading TAVI Products on catheters, catheters, guidewires, delivery systems, introducer systems such as sheaths, closure systems, and pacing protocols.

1.40“TAVI Field” means TAVI Products and TAVI Accessories.

1.41“TAVI Products” means prosthetic aortic heart valves delivered via catheter and without removal of the patient’s native aortic valve, whether delivered via transvascular, transaortic, subclavian, transapical, or other approach.

1.42“Taxes” means any taxes, fees, or other charges.

1.43“Third Party” means any Enterprise other than Edwards or Medtronic.

1.44[*]

2EDWARDS LICENSE GRANT

2.1Edwards hereby grants to Medtronic a royalty-bearing worldwide, non-exclusive, non-assignable, irrevocable license, without the right to sublicense, to the Edwards TAVI Patents to manufacture, Have Manufactured, use, import, offer for sale, and sell Medtronic Products solely within the TAVI Field until the expiration of the last to expire of the Edwards

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

6

TAVI Patents, including any term extensions and/or term adjustments, but in no event later than the expiration of the Royalty Term.

2.2Edwards hereby grants to Medtronic a fully paid-up worldwide, non-exclusive, non-assignable, irrevocable license, without the right to sublicense, to the Edwards Surgical Patents to manufacture, Have Manufactured, use, import, offer for sale, and sell products solely within the Surgical Field until the expiration of the last to expire of the Edwards Surgical Patents, including any term extensions and/or term adjustments.

2.3The licenses granted pursuant to this Section 2 shall not be used to manufacture products on an OEM Basis for a Third Party.  The licenses granted herein shall be used for the sole and exclusive benefit of Medtronic, including with respect to sales of Medtronic’s products through distributors, agents, and other Third Parties.

3MEDTRONIC LICENSE GRANT

3.1Medtronic hereby grants to Edwards a fully paid-up worldwide, non-exclusive, non-assignable, irrevocable license, without the right to sublicense, to the Medtronic TAVI Patents to manufacture, Have Manufactured, use, import, offer for sale, and sell Edwards Products solely within the TAVI Field until the expiration of the last to expire of the Medtronic TAVI Patents, including any term extensions and/or term adjustments.

3.2Medtronic hereby grants to Edwards a fully paid-up worldwide, non-exclusive, non-assignable, irrevocable license, without the right to sublicense, to the Medtronic Surgical Patents to manufacture, Have Manufactured, use, import, offer for sale, and sell products solely within the Surgical Field until the expiration of the last to expire of the Medtronic Surgical Patents, including any term extensions and/or term adjustments.

3.3[*]

3.4The licenses granted pursuant to this Section 3 shall not be used to manufacture products on an OEM Basis for a Third Party.  The licenses granted herein shall be used for the sole and exclusive benefit of Edwards, including with respect to sales of Edwards’ products through distributors, agents, and other Third Parties.

4INITIAL PAYMENT

4.1Within five (5) business days of the Effective Date, Medtronic shall pay Seven Hundred Fifty Million U.S. Dollars ($750,000,000) (the “Initial Payment”), less any withholding of Taxes required as set forth in Section 6.4, by wire transfer to the accounts specified by Edwards in Exhibit A to this Agreement.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

7

4.2The Initial Payment shall be allocated as specified in Exhibit B to this Agreement.  Each Party shall file all tax returns consistent with the allocation specified in Exhibit B to this Agreement, except as may be required by applicable law.

5ROYALTIES

5.1From and including the Effective Date to and including March 22, 2016, Medtronic shall pay Edwards Lifesciences PVT, Inc. a royalty of [*] on all Net Sales of Medtronic Products which Medtronic commercially sold to a Third Party in the United States.

5.2From and including March 23, 2016 to and including December 31, 2017, Medtronic shall pay Edwards Lifesciences PVT, Inc. a royalty of [*] on all Net Sales of Medtronic Products which Medtronic commercially sold to a Third Party in the United States.

5.3From and including the Effective Date to the expiration of the Royalty Term, Medtronic shall pay Edwards Lifesciences LLC a royalty of [*] on all Net Sales of Medtronic Products which Medtronic commercially sold to a Third Party in the United States.  This payment of Section 5.3 is in addition to those made under Sections 5.1 and 5.2.

5.4From and including the Effective Date to the expiration of the Royalty Term, Medtronic shall pay Edwards Lifesciences LLC a royalty of [*] on all Net Sales of Medtronic Products which Medtronic Manufactured in the United States or Had Manufactured in the United States and commercially sold to a Third Party outside the United States.  For clarity, if Medtronic Manufactures or Has Manufactured Medtronic Product in the United States and commercially sells such Medtronic Product to a Third Party in the United States, no royalties will be due under this Section 5.4 on account of such sales.

5.5[*]

5.6Notwithstanding Sections 5.1, 5.2, 5.3, and 5.5 of this Agreement, Medtronic shall pay aggregate annual minimum royalties of Forty Million Dollars ($40,000,000), and aggregate annual maximum royalties of Sixty Million Dollars ($60,000,000), calculated for each Royalty Year as set forth in Sections 6.2 and 6.3, excluding any royalty owed under Section 5.4 of this Agreement.  Should any Royalty Year under which a minimum or maximum royalty accrues under this Agreement contain fewer than 365 days (or 366 days in a year that includes a leap year), the minimum or maximum royalty for such period shall be pro-rated based on the number of days in such period.  Should Medtronic cease to have any Net Sales of Medtronic Products and state publicly its intention not to resume any such Net Sales, the aggregate annual minimum and maximum royalties shall be pro-rated for the Royalty Year of exit and thereafter unless any such Net Sales resume.

5.7Notwithstanding Sections 5.1, 5.2, 5.3, 5.4, 5.5 and 5.6 of this Agreement, Medtronic shall owe no royalty for any Medtronic Product which was used (a) in any United States Investigational Device Exemption clinical study, or in a comparable clinical study abroad,

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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required by a Regulatory Authority for approval; (b) in any continued access study protocol approved by a Regulatory Authority; or (c) as a demonstration product and not labeled for implantation in patients.  For avoidance of doubt, Medtronic shall owe royalties on Net Sales accrued under this Agreement for any Medtronic Product which Medtronic sold to a Third Party and which was used in a post-approval study, including post-approval registries.

5.8No part of any payment required by Sections 4 or 5 of this Agreement will be owed back to Medtronic under any agreement, [*].  In addition, no payment required by Sections 4 or 5 shall cease to be due or be owed back to Medtronic based on any change in circumstances concerning the Edwards Licensed Patents.  Possible changes to the Edwards Licensed Patents coverage have been considered by the Parties and the royalty rates reflect such considerations.

5.9[*].

5.10For clarity, [*] in no event shall Medtronic have any obligation to pay any royalties for any Medtronic Product during the Royalty Term, wherever Medtronic manufactured, Had Manufactured, sold, used or imported such Medtronic Product, other than as set forth in Sections 5.1-5.6 of this Agreement.

6PAYMENT OF ROYALTIES / RIGHT TO AUDIT

6.1 Within thirty (30) days of the last day of each Fiscal Quarter of the Royalty Term, Medtronic shall pay all royalties accrued under this Agreement during such Fiscal Quarter, along with a written report (“Royalty Report”) in the form of Exhibit C detailing for such Fiscal Quarter the total Net Sales subject to royalty payments hereunder, royalties payable, and total minimum and maximum royalties paid or payable for the applicable period, along with the certification set forth in Exhibit C.

6.2 If Medtronic has paid aggregate royalties during any Royalty Year under the terms of Section 5 of this Agreement that are less than the aggregate annual minimum of Forty Million Dollars ($40,000,000), Medtronic will submit a report indicating the difference between the royalties actually paid and such aggregate minimum (the “Royalty True Up”) within thirty (30) days following the end of each Royalty Year, and shall make a payment of the Royalty True Up within ten (10) days following receipt of written instructions from Edwards indicating the appropriate allocation of such Royalty True Up between Edwards Lifesciences PVT, Inc. and Edwards Lifesciences LLC.

6.3If Medtronic has paid royalties during any Royalty Year under the terms of Section 5 of this Agreement which equal the aggregate annual maximum of Sixty Million Dollars ($60,000,000), Medtronic will so indicate on each Royalty Report for the Fiscal Quarter in which such aggregate maximum is paid, and for any subsequent Fiscal Quarter which falls in whole or in part in such Royalty Year, and no further royalties will be due for such Royalty Year.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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6.4If Tax withholdings are required under the laws of any country with respect to payments to Edwards under this Agreement, Medtronic will withhold the required amount and pay it to the appropriate governmental authority.  In such case, Medtronic will promptly provide to Edwards copies of receipts or other evidence reasonably required and sufficient to allow Edwards to document such Tax withholdings adequately for purposes of claiming foreign tax credits, refunds, corrections, and similar benefits. Edwards shall provide Medtronic with such documentation as is reasonably requested to establish any available exemptions or reduced rates of such Taxes.  Medtronic shall be responsible for all bank charges associated with remittance of any payments.

6.5All royalties accrued under this Agreement shall be paid in United States dollars.  Net Sales that are denominated in currencies other than United States dollars will be converted into United States dollars according to Medtronic’s standard accounting policy for conversion of foreign currencies.

6.6Any amount due and payable pursuant to this Agreement and which is not paid when due shall bear interest at the lesser of (a) one and one-half percent (1.5%) per month compounded monthly, or (b) the maximum amount allowable by law.

6.7Medtronic shall keep, and maintain, complete and accurate records concerning the Net Sales of Medtronic Products which Medtronic sold in the United States at its principal executive offices in Minnesota, and for sales of Medtronic Product which Medtronic Manufactured or Had Manufactured in the United States and sold outside the United States, at its principal executive offices in the country of sale, or such other locations as the Parties shall agree.  No more than one time per Royalty Year, on thirty (30) days prior written notice by Edwards, Medtronic shall compile said records in one U.S. location and shall permit said records to be inspected at Edwards’ expense, at any time during normal business hours, by an independent auditor appointed by Edwards and reasonably accepted by Medtronic for this purpose.  Such auditors shall execute a suitable confidentiality agreement prior to conducting such audit.  Such representatives may disclose to Edwards only their conclusions regarding the accuracy and completeness of the reports described in Section 6.1 and the records related thereto, and shall not disclose Medtronic’s confidential business information to Edwards without the prior written consent of Medtronic.  In the event of an underpayment by Medtronic, Medtronic shall immediately pay Edwards for any such underpayment plus applicable interest.  In the event of an overpayment by Medtronic, Medtronic may credit such overpayment against future Fiscal Quarter royalty payments, or, in the event Medtronic has no further royalties due and owing hereunder because the Royalty Term has expired, Edwards will promptly refund such overpayment.  In the event that the audit reveals an underpayment of royalties by Medtronic of more than five percent (5%), Medtronic shall reimburse Edwards for all costs of such audit.

7RELEASES

7.1For good and valuable consideration, Edwards hereby releases, exonerates and forever and unconditionally discharges Medtronic and its officers, directors, employees,

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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representatives, shareholders, successors, assigns, agents, and each past, present, direct or indirect parent, division, subsidiary or Affiliate, from any and all known and unknown (a) claims and causes of action arising directly or indirectly out of the facts, transactions, and/or occurrences which are the subject of the Pending Cases, including but not limited to the claims and/or counterclaims asserted in the Pending Cases and any claims and/or counterclaims that reasonably could have been asserted in the Pending Cases,  and (b) claims and causes of action for patent infringement with respect to the Medtronic Products and/or any Medtronic products accused of patent infringement in the Pending Cases (collectively “Edwards Released Matters”).

7.2          For good and valuable consideration, Medtronic hereby releases, exonerates and forever and unconditionally discharges Edwards and its officers, directors, employees, representatives, shareholders, successors, assigns, agents, and each past, present, direct or indirect parent, division, subsidiary or Affiliate, from any and all known and unknown (a) claims and causes of action arising directly or indirectly out of the facts, transactions, and/or occurrences which are the subject of the Pending Cases, including but not limited to the claims and/or counterclaims asserted in the Pending Cases and any claims and/or counterclaims that reasonably could have been asserted in the Pending Cases, and (b) claims and causes of action for patent infringement with respect to the Edwards Products and/or any Edwards products accused of patent infringement in the Pending Cases (collectively “Medtronic Released Matters”).

7.3          It is the intention of the Parties that this Agreement shall comprise a full and final accord and mutual release of the Edwards Released Matters and the Medtronic Released Matters.  Each of the Parties acknowledges that it is aware that it or its attorneys or advisors may hereafter discover claims or facts in addition to or different from those which it now knows or believes to exist with respect to the Edwards Released Matters or Medtronic Released Matters, but that it is its intention hereby to fully and finally and forever settle and release the Edwards Released Matters and Medtronic Released Matters, subject only to each Party’s rights of rescission of such releases based on the failure of the other Party to perform its obligations under Sections 4.1 or 10.1.  The provisions of this Section 7 shall survive the expiration or termination of this Agreement for any reason.

7.4          Each of the Parties by and on behalf of their officers, directors, employees, representatives, shareholders, successors, assigns, agents, and each past, present, direct or indirect parent, division, subsidiary or Affiliate, hereby waive with respect to the release of Paragraph 7.1 and 7.2, as applicable, the benefits of Section 1542 of the Civil Code of California to the extent that such benefits may contravene a provision hereof.  Such Section reads as follows:

“1542.    General Release Extent.  A General Release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the Release, which if known by him or her must have materially affected his settlement with the debtor.”

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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8              COVENANTS NOT TO SUE

8.1          During the Covenant Term, Edwards covenants not to sue Medtronic or its officers, directors,  employees,  or outside of the United States its customers, resellers, or distributors who by law do not have the benefit of patent exhaustion, in any court or government agency anywhere in the world for (a) patent infringement based on Medtronic’s manufacture, Having Manufactured, use, import, offer for sale, or sale of Medtronic Products, TAVI Accessories, and products within the Non-Aortic Field or (b) non-infringement of any of the Medtronic Licensed Patents, unless in defense to a patent infringement suit involving such a patent.  The foregoing covenant shall run with title to the Covenant Patents and shall bind any Third Party that acquires a permitted interest in any Covenant Patent (including any Edwards Affiliate that becomes a Third Party).  Edwards shall inform any such assignee, licensee, Affiliate, or Third Party specified in the previous sentence of this covenant, and shall obtain their agreement to be bound by this covenant, before such transaction specified in the previous sentence.

8.2          During the Covenant Term, Medtronic covenants not to sue Edwards or its officers, directors, employees, or outside of the United States its customers, resellers, or distributors  who by law do not have the benefit of patent exhaustion, in any court or government agency anywhere in the world for (a) patent infringement based on Edwards’ manufacture, Having Manufactured, use, import, offer for sale, or sale of Edwards Products, TAVI Accessories, and products within the Non-Aortic Field; or (b) non-infringement of any of the Edwards Licensed Patents, unless in defense to a patent infringement suit involving such a patent.  The foregoing covenant shall run with title to the Covenant Patents and shall bind any Third Party that acquires a permitted interest in any Covenant Patent (including any Medtronic Affiliate that becomes a Third Party).  Medtronic shall inform any such assignee, licensee, Affiliate, or Third Party specified in the previous sentence of this covenant, and shall obtain their agreement to be bound by this covenant, before such transaction specified in the previous sentence.

8.3          Edwards shall not seek damages for patent infringement based on Medtronic’s manufacture, Having Manufactured, use, import, offer for sale, or sale of  Medtronic Products, TAVI Accessories, and products within the Non-Aortic Field which otherwise might have accrued during the Covenant Term but for Section 8.1.

8.4          Medtronic shall not seek damages for patent infringement based on Edwards’ manufacture, Having Manufactured, use, import, offer for sale, or sale of Edwards Products, TAVI Accessories, and products within the Non-Aortic Field which otherwise might have accrued during the Covenant Term but for Section 8.2.

8.5          For avoidance of doubt, this Section 8 does not prohibit a Party from (a) invoking during the Covenant Term the dispute resolution procedures in Section 16 for disputes arising out of, or in connection with, this Agreement; (b) enforcing any decisions that result from invoking the dispute resolution procedures in Section 16; and (c) seeking damages

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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for periods of time before a Third Party became an Affiliate of a Party, or for periods of time after which a Third Party ceases to be an Affiliate of a Party.

8.6          Any delay in bringing suit pursuant to this Section 8 shall not be used in any way against a Party in any future action or proceeding.

8.7          Unless otherwise licensed under this Agreement, the covenants of this Section 8 shall not be deemed to be a license of any intellectual property rights of either Party to the other Party.

9              NO CHALLENGE TO LICENSED PATENTS

9.1          During the Covenant Term, Edwards covenants not to directly or indirectly challenge, or otherwise voluntarily assist a Third Party in any way to challenge the validity, enforceability, patent term extension application, and/or granted patent term extension of any Medtronic Licensed Patent, or take any other action against any Medtronic Licensed Patent, in any court, government agency, or other venue or in any other manner, other than as specified in this Agreement, unless in defense related to a patent infringement suit involving such a patent.

9.2          During the Covenant Term, Medtronic covenants not to directly or indirectly challenge, or otherwise voluntarily assist a Third Party in any way to challenge the validity, enforceability, patent term extension application, and/or granted patent term extension of any Edwards Licensed Patent, or take any other action against any Edwards Licensed Patent, in any court, government agency, or other venue or in any other manner, other than as specified in this Agreement, unless in defense related to a patent infringement suit involving such a patent.

9.3          Any delay in bringing action pursuant to this Section 9 shall not be used in any way against a Party in any future action or proceeding.

10           PENDING CASES AND PENDING PROCEEDINGS

10.1        The Parties agree that within five (5) business days of the Initial Payment, the Parties will cause their respective counsel to file a Stipulation and Order of Dismissal with Prejudice, thereby dismissing with prejudice all claims, counterclaims, and defenses of all Parties in the Pending Cases, with each Party bearing its own (and waiving all entitlements to) court fees, attorney fees, costs, and expenses.

10.2        Within five (5) business days of the Initial Payment, Medtronic agrees to withdraw in writing (or in such other manner as is required) its opposition before the FDA and PTO to Edwards’ application for patent term extension of U.S. Patent No. 5,411,552, and thereafter Medtronic shall refrain from directly or indirectly participating in such proceedings to the detriment of Edwards.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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10.3        Within five (5) business days of the Initial Payment, Edwards agrees to terminate in writing (or in such other manner as is required) its requests for reexamination in the Edwards Reexaminations, and its participation in the EPO proceeding concerning EP1803421, and Medtronic agrees to terminate in writing (or in such other manner as is required) its participation in Pending Proceedings, including the Medtronic Reexaminations, the proceedings in the EPO and APO, and the proceedings before the PTO and FDA concerning the patent term extension of U.S. Patent No. 5,411,552, with each Party bearing its own attorney fees, costs, and expenses, and thereafter each Party shall refrain from directly or indirectly participating in such proceedings and reexaminations to the detriment of the other Party.

10.4        As of the Effective Date, the Parties agree that, unless otherwise prohibited herein, persons who received material marked confidential and/or highly confidential in a Pending Case may participate in and/or supervise reexamination, reissue, opposition, invalidity, interference proceedings, or equivalent proceedings, such as post-grant and inter partes review, involving patents or patent applications, except that such persons who received material marked highly confidential may not draft new or amended claims in any such proceedings in the TAVI Field.  The Parties agree that such participation is not a violation of any order in a Pending Case.

11           REPRESENTATIONS AND WARRANTIES

11.1        Edwards represents and warrants to Medtronic that (a) it has all requisite legal right, power and authority to execute, deliver and perform this Agreement; (b) it owns, or owns the exclusive right to assert, the Edwards Licensed Patents applicable to the Medtronic Products, and that no Third Party owns any right to recover for infringement of the Edwards Licensed Patents applicable to the Medtronic Products; (c) all named inventors of any of the Edwards Licensed Patents applicable to the Medtronic Products have retained no rights (including without limitation rights to sue and rights of reversion) in such patents that would permit them to make a claim against Medtronic; (d) it has not granted and will not grant any licenses or other rights, under the Edwards Licensed Patents or otherwise, that would conflict with the licenses, releases, and rights granted to Medtronic hereunder or prevent Medtronic’s exercise of these licenses, releases, and rights; and (e) there are no liens, conveyances, mortgages, assignments, encumbrances, or other agreements that would prevent or impair the full and complete exercise of the terms of this Agreement.

11.2        Medtronic represents and warrants to Edwards that (a) it has all requisite legal right, power and authority to execute, deliver and perform this Agreement; (b) it owns, or owns the exclusive right to assert, the Medtronic Licensed Patents applicable to the Edwards Products, and that no Third Party owns any right to recover for infringement of the Medtronic Licensed Patents applicable to the Edwards Products; (c) all named inventors of any of the Medtronic Licensed Patents applicable to the Edwards Products have retained no rights (including without limitation rights to sue and rights of reversion) in such patents that would permit them to make a claim against Edwards; (d) it has not granted and will not grant any licenses or other rights, under the Medtronic Licensed Patents or otherwise, that would conflict

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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with the licenses, releases and rights granted to Edwards hereunder or prevent Edwards’ exercise of these licenses, releases and rights; and (e) there are no liens, conveyances, mortgages, assignments, encumbrances, or other agreements that would prevent or impair the full and complete exercise of the terms of this Agreement.

11.3        In the event of a material breach of any of the representations and warranties in Sections 11.1 and 11.2 of this Agreement, the Party harmed by such breach shall be defended, indemnified, and held harmless by the Party giving the representations or warranties from and against all claims, costs, attorneys’ fees, and other expenses brought against or incurred by said harmed Party as a consequence of such breach.

11.4        [*]

11.5        Nothing in this Agreement shall be construed as a warranty or representation by any Party that any of the Edwards Licensed Patents or Medtronic Licensed Patents is valid or enforceable in any country or government tribunal, and nothing in this Agreement shall be construed as imposing on either Party any obligation to file any patent application or to secure any patent or maintain any patent in force or to seek reissue, reexamination, or an extension of any patent, or an obligation on either Party to enforce its patents against Third Parties, or imposing on either Party any obligation to institute any suit or action for infringement of any of its patents or to defend any suit or action brought by a Third Party which challenges or concerns the validity of any patent licensed under this Agreement.

11.6        Furthermore, nothing in this Agreement shall be construed as a warranty or representation that any product or process manufactured, used, leased or sold and/or otherwise disposed of or put into use by any Party shall be free from infringement of patents or other intellectual property of Third Parties.  No Party shall have any obligation under this Agreement to indemnify or undertake the defense of any other Party for any claim or claims made for patent, trademark, trade name, service mark or copyright infringement by Third Parties, and, in the event of any such claim or any legal action related thereto, each Party shall pay its own expenses and any judgment rendered against it, except as set forth in Section 11.3

11.7        EXCEPT AS EXPRESSLY PROVIDED OTHERWISE HEREIN EACH PARTY MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND WITH RESPECT TO ITS LICENSED PATENTS AND ANY LICENSED PRODUCTS, AND EXPRESSLY DISCLAIMS ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND ANY OTHER IMPLIED WARRANTIES WITH RESPECT TO THE CAPABILITIES, SAFETY, UTILITY OR COMMERCIAL APPLICATION OF THE LICENSED PATENTS AND THE LICENSED PRODUCTS. LICENSOR SHALL NOT BE LIABLE FOR ANY DIRECT, CONSEQUENTIAL OR OTHER DAMAGES SUFFERED BY LICENSEE OR ANY OTHERS RESULTING FROM THE USE OF THE LICENSED PATENTS AND THE LICENSED PRODUCTS.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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12           CONFIDENTIALITY

12.1        Except for the press releases and other announcements and communications referenced in Section 12.2 herein, and except to the extent reasonably necessary to satisfy corporate, financial or regulatory disclosure requirements (including but not limited to disclosure pursuant to applicable securities or to the Internal Revenue Service), or  in an action commenced pursuant to Section 16.2, or as required by law or judicial process, the Parties agree that any information with respect to the terms of this Agreement (other than to acknowledge the existence of this Agreement or the fact that a Party has the licenses granted herein) shall remain confidential and shall not be disclosed to any Third Party.  [*]  If any Party is served with judicial process that it determines requires disclosure of this Agreement or any of its terms, it shall notify the other Party promptly, and in any event within five (5) business days of the receipt of such judicial notice so that the other Party may seek a protective order or other remedy, and  shall consult in good faith with the other Party regarding the necessity for any such disclosure, the terms of any such disclosure, and whether measures should be taken to oppose or restrict access to the Agreement or its terms. In the event that such protective order or other remedy is not obtained or is not available, the Party served with judicial process shall furnish only that portion of such confidential information that is legally required to be provided, and use commercially reasonable efforts to obtain assurances that confidential treatment will be accorded such information. The obligations set forth in this Section 12 shall survive termination of this Agreement

12.2        The Parties shall cooperate in drafting the language of separate press releases, made public at a time mutually agreed by the parties, to announce that the Parties have reached this Agreement. In addition, the Parties shall cooperate in establishing the parameters of the scope and content of other public announcements and communications regarding terms of this Agreement, such as the amount of the upfront payment, minimum and maximum royalties duration and scope of the licenses and covenants, and similar matters.

13           ENTIRE AGREEMENT

13.1        This Agreement (which includes any exhibits attached hereto) contains the entire agreement and understanding between the Parties concerning the subject of this Agreement and supersedes all previous negotiations, discussions and agreements, other than [*].  This Agreement shall not be modified, amended, or otherwise changed except by a writing executed by the Parties.

14           SUCCESSORS AND ASSIGNS

14.1        This Agreement shall be binding upon and inure to the benefit of the Parties hereto, and to their respective heirs, successors, divisions, Affiliates, representatives, assigns, officers, directors, and employees.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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14.2        A Change of Control is deemed to be an assignment of this Agreement.  No Party hereto shall assign its rights or obligations of this Agreement by operation of law or otherwise, without first obtaining the written consent of the other Party hereto; provided, however, that consent shall not be required for any such assignment by a Party of its rights and obligations hereunder (a) to an Affiliate, (b) by Change of Control, or (c) by merger, sale or transfer of all or substantially all of the assets of any or all of its (i) surgical heart valve business, (ii) its catheter delivered heart valve business, or (iii) its entire heart valve business, in each case including by consolidation or operation of law, and in each case subject to the license limitation in Section 14.4 and covenant limitation in Section 14.5.

14.3        In the event of a permitted assignment by a Party of its rights and obligations hereunder by merger, sale or transfer of all or substantially all of the assets of only (a) its surgical heart valve business or (b) its catheter delivered heart valve business, those portions of the Agreement that apply to the business that is sold shall be deemed to have been assigned, and shall be interpreted as if any relevant provisions of general applicability also were assigned.

14.4        In the event of a permitted assignment of this Agreement (including under Section 14.3), other than to an Affiliate, the licenses granted in Section 2 or 3, as applicable, of this Agreement shall automatically, as of the effective date of such assignment, be thereafter limited in scope to only those specific Medtronic Products or Edwards Products, as applicable, that were (a) commercially released, (b) in clinical trials, and/or (c) for which an application has been submitted initiating the process for regulatory approval of clinical trials and/or commercial distribution as of a date ninety (90) days prior to the effective date of such assignment.

14.5        In the event of a permitted assignment of this Agreement (including under Section 14.3), other than to an Affiliate, the covenants granted under Section 8 of this Agreement shall automatically, as of the effective date of such assignment, be thereafter limited in scope to only those specific products and accessories of the assigning Party that were (a) commercially released, (b) in clinical trials, and/or (c) for which an application has been submitted initiating the process for regulatory approval of clinical trials and/or commercial distribution as of a date ninety (90) days prior to the effective date of such assignment.

14.6        The assignable provisions of this Agreement that are not yet fully performed at the time of the assignment shall extend to and are binding on the Parties hereto and their successors and permitted assigns.

15           GOVERNING LAW

15.1        This Agreement, and the performance hereunder, shall be governed by the laws of the State of California, without regard to the conflict of laws principles thereof; but all issues relative to the form, content, scope, status, enforceability, construction or use of any patent or patent application covered by this Agreement shall be determined by the law of the country of such patent or patent application.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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16           DISPUTE RESOLUTION

16.1        In the event of any dispute arising under or connection with this Agreement, the aggrieved Party must give written notice to the other Party as provided in Section 19 of this Agreement (“Dispute Notice”).  In the event of an alleged breach, the breaching Party has ten (10) business days from its receipt of the Dispute Notice to cure the breach.  Should the breach not be cured within ten (10) business days, the aggrieved Party may invoke the dispute resolution procedures in Section 16.2 of this Agreement.

16.2        The Parties will attempt to settle amicably all disputes arising under or in connection with this Agreement, including [*], by good faith negotiations of senior executives/senior managers for a period of at least ninety (90) days following receipt of the Dispute Notice.  If the Parties are unable to resolve their dispute within such period, the aggrieved Party shall submit the matter to binding and non-appealable arbitration conducted in accordance with the provisions of Exhibit D as their sole and exclusive remedy, except that either Party may seek emergency equitable relief in a federal or state court located in the State of California. The arbitrator  in any dispute is empowered to render an award of general compensatory damages, and is  empowered to award equitable relief (including, without limitation, injunctive relief or orders of specific performance), exemplary or punitive damages or other damages.  The prevailing Party in any dispute  shall be entitled to an award of its reasonable attorneys’ fees, costs, and expenses.

17           COUNTERPARTS

17.1        This Agreement may be executed in counterparts (each of which shall be deemed an original), and receipt by facsimile or other electronic transmission of executed copies shall be legally binding.

18           GENERAL PROVISIONS

18.1        If and to the extent any court of competent jurisdiction holds any provision (or any part thereof) of this Agreement to be invalid or unenforceable, such holding shall in no way affect the validity and enforceability of the remainder of this Agreement.  Each Party was represented by counsel in the negotiation and preparation of this Agreement, and in no event shall any provision hereof be interpreted against either Party as the drafter hereof.

18.2        This Agreement does not make any Party the employee, agent or legal representative or part of any other Party for any purpose whatsoever.  No Party is granted any right or authority to assume or create any obligation or responsibility, express or implied, on behalf of or in the name of any other Party.  In fulfilling its obligations pursuant to this Agreement, each Party shall be acting as an independent contractor.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

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18.3        Nothing in this Agreement, express or implied, is intended to confer on any person other than the Parties to this Agreement or the respective successors or permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

18.4        The failure of any Party hereto to enforce at any time any of the provisions of this Agreement shall not, absent an express written waiver signed by the Party making such waiver specifying the provision be waived, be construed to be a waiver of any such provision, nor in any way to affect the validity of this Agreement or any part thereof or the right of the Party thereafter to enforce each and every such provision.  No waiver of any breach of this Agreement shall be held to be a waiver of any other or subsequent breach.

18.5        Each Party agrees to execute such additional documents or instruments as are specifically contemplated herein or as otherwise may reasonably be required to carry out the intents and purposes of this Agreement.

18.6        The words “hereof,” “herein,” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provisions of this Agreement. Terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa. References to an “Exhibit” or to a “Schedule” are, unless otherwise specified, to one of the Exhibits or Schedules attached to or referenced in this Agreement, and references to an “Article” or a “Section” are, unless otherwise specified, to one of the Articles or Sections of this Agreement.

19           NOTICES

19.1        Any notice or other written statement permitted or required by this Agreement shall be in writing and shall be sent by certified mail (return receipt requested), overnight courier, or hand delivery at the respective addresses specified below, or such other addresses as the respective Parties may from time to time designate:

If to Edwards:

Edwards Lifesciences

Attention: General Counsel

One Edwards Way

Irvine, CA  92614

Fax: [*]

With a copy to:

Catherine Nyarady, Esq.

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, NY  10019

Fax: [*]

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

19

If to Medtronic:

Medtronic Inc

Attention: General Counsel

710 Medtronic Parkway

Minneapolis, Minnesota 55432

With a copy to:

Medtronic Inc

Attention: Chief Legal Counsel, Structural Heart Division

8200 Coral Sea Street NE
Mail Stop MVS76
Mounds View MN 55112

And a copy to:

Ann Marie Ladd, Esq.

Fredrikson & Byron, P.A.

200 South Sixth Street, Suite 4000

Minneapolis, Minnesota  55402

The remainder of this page is intentionally left blank.

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

20

EACH PARTY ACKNOWLEDGES THAT THEY HAVE READ THIS AGREEMENT, UNDERSTAND IT, AND ARE VOLUNTARILY ENTERING INTO IT.

IN WITNESS WHEREOF, the Parties have executed this Agreement to be binding and enforceable on the Effective Date.

Edwards Lifesciences Corporation		Medtronic, Inc.
/s/ Aimee S. Weisner		/s/ Neil P. Ayotte
By: Aimee S. Weisner Corporate Vice President, General Counsel		By: Neil P. Ayotte VP and Interim General Counsel
Dated:	May 19, 2014	Dated:	May 19, 2014

Confidential

[*]  Indicates that certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to omitted portions.

21

EX-31.1

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Exhibit 31.1

EDWARDS LIFESCIENCES CORPORATION
CERTIFICATIONS PURSUANT TO
SECTION 302 OF
THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Michael A. Mussallem, certify that:

        1.     I have reviewed this quarterly report on Form 10-Q of Edwards Lifesciences Corporation;

        2.     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;

        3.     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 the registrant as of, and for, the periods presented in this report;

        4.     The registrant's other certifying officer(s) 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 the registrant and have:

        (a)   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 the registrant, 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;

        (b)   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;

        (c)   Evaluated the effectiveness of the registrant'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

        (d)   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

        5.     The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

        (a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

        (b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 4, 2014 By: /s/ MICHAEL A. MUSSALLEM
Michael A. Mussallem
Chairman of the Board and
Chief Executive Officer

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Exhibit 31.1

EDWARDS LIFESCIENCES CORPORATION CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

EX-31.2

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Exhibit 31.2

EDWARDS LIFESCIENCES CORPORATION
CERTIFICATIONS PURSUANT TO
SECTION 302 OF
THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Scott B. Ullem, certify that:

        1.     I have reviewed this quarterly report on Form 10-Q of Edwards Lifesciences Corporation;

        2.     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;

        3.     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 the registrant as of, and for, the periods presented in this report;

        4.     The registrant's other certifying officer(s) 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 the registrant and have:

        (a)   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 the registrant, 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;

        (b)   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;

        (c)   Evaluated the effectiveness of the registrant'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

        (d)   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

        5.     The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

        (a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

        (b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 4, 2014 By: /s/ SCOTT B. ULLEM
Scott B. Ullem
Corporate Vice President,
Chief Financial Officer

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Exhibit 31.2

EDWARDS LIFESCIENCES CORPORATION CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

EX-32

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Exhibit 32

EDWARDS LIFESCIENCES CORPORATION
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        In connection with the Quarterly Report of Edwards Lifesciences Corporation (the "Company") on Form 10-Q for the period ended June 30, 2014 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), we, Michael A. Mussallem, Chairman of the Board and Chief Executive Officer of the Company, and Scott B. Ullem, Corporate Vice President, Chief Financial Officer, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

        (1)   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

        (2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 4, 2014	/s/ MICHAEL A. MUSSALLEM Michael A. Mussallem Chairman of the Board and Chief Executive Officer
August 4, 2014	/s/ SCOTT B. ULLEM Scott B. Ullem Corporate Vice President, Chief Financial Officer

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Exhibit 32

EDWARDS LIFESCIENCES CORPORATION CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

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INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET (Details) (Medtronic litigation settlement, USD $) In Millions, unless otherwise specified	1 Months Ended		1 Months Ended		3 Months Ended
	May 31, 2014	May 31, 2014 Estimated fair value	May 31, 2014 United States Minimum	May 31, 2014 United States Maximum	Jun. 30, 2014 Past damages	May 31, 2014 Past damages Estimated fair value	May 31, 2014 License agreement Estimated fair value	May 31, 2014 Covenant not to sue Estimated fair value
Settlement agreement
Term of agreement	8 years
Amount of upfront payment received	$ 750.0
Annual royalty payment			40.0	60.0
Consideration		1,070.0				754.3	238.0	77.7
Upfront payment recognized	$ 750.0				$ 750.0

XML

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 3) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Foreign currency contracts
Derivative Asset
Gross Amounts	$ 3.2	$ 13.8
Net Amounts Presented in the Consolidated Balance Sheet	3.2	13.8
Derivative Assets, Gross Amounts Not Offset in the Consolidated Balance Sheet
Financial Instruments	(3.2)	(9.5)
Net amount		4.3
Derivative Liabilities
Gross Amounts	7.1	13.2
Net Amounts Presented in the Consolidated Balance Sheet	7.1	13.2
Derivative Liabilities, Gross Amounts Not Offset in the Consolidated Balance Sheet
Financial Instruments	(3.2)	(9.5)
Net amount	3.9	3.7
Interest rate swap agreements
Derivative Asset
Gross Amounts	0.7
Net Amounts Presented in the Consolidated Balance Sheet	0.7
Derivative Assets, Gross Amounts Not Offset in the Consolidated Balance Sheet
Net amount	0.7
Derivative Liabilities
Gross Amounts		4.0
Net Amounts Presented in the Consolidated Balance Sheet		4.0
Derivative Liabilities, Gross Amounts Not Offset in the Consolidated Balance Sheet
Net amount		$ 4.0

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OTHER INTANGIBLE ASSETS (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
OTHER INTANGIBLE ASSETS
Amortization expense related to other intangible assets	$ 2.0	$ 2.5	$ 4.1	$ 5.0
Estimated amortization expense
2014					8.5
2015					7.8
2016					7.6
2017					6.9
2018					$ 1.6

XML

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 4) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Derivative Instruments, Gain (Loss)
Expected reclassification of loss recorded in accumulated other comprehensive loss into earnings during next twelve months			$ (2.8)
Derivatives not designated as hedging instruments | Foreign currency contracts | Other expense, net
Derivative Instruments, Gain (Loss)
Amount of Gain or (Loss) Recognized in Income on Derivative	(2.5)	5.1	(3.2)	14.4
Derivatives in cash flow hedging relationships | Foreign currency contracts
Derivative Instruments, Gain (Loss)
Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)	(2.7)	6.0	(4.4)	27.7
Derivatives in cash flow hedging relationships | Foreign currency contracts | Cost of sales
Derivative Instruments, Gain (Loss)
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income	3.0	5.8	8.0	11.0
Derivatives in fair value hedging relationship | Interest rate swap agreements | Interest expense, net
Derivative Instruments, Gain (Loss)
Amount of Gain or (Loss) Recognized in Income on Derivative	$ 2.6		$ 4.7

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INVESTMENTS (Details 3) (USD $) In Millions, unless otherwise specified	1 Months Ended
	Mar. 31, 2014	Jun. 30, 2014	Dec. 31, 2013
Available-for-sale investments
Cost		$ 0.4	$ 0.4
Unrealized gains		0.1	0.4
Fair value of available-for-sale investments		0.5	0.8
Equity method investments
Cost		12.4	14.1
Equity in losses		(1.5)	(2.7)
Carrying value of equity method investments		10.9	11.4
Cost method investments
Carrying value of cost method investments		6.7	9.7
Total investments in unconsolidated affiliates		18.1	21.9
Other-than-temporary impairment cost method investments	$ 3.5

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STOCK-BASED COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2014

STOCK-BASED COMPENSATION

Schedule of stock-based compensation expense

Stock-based compensation expense related to awards issued under the Company's incentive compensation plans for the three and six months ended June 30, 2014 and 2013 was as follows (in millions):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Cost of sales	$	1.5	$	1.5	$	3.0	$	2.9
Selling, general and administrative expenses		8.6		9.4		17.4		17.6
Research and development expenses		1.8		1.9		3.5		3.5
Total stock-based compensation expense	$	11.9	$	12.8	$	23.9	$	24.0

Schedule of weighted-average assumptions for options granted

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Average risk-free interest rate		1.4	%		0.8	%		1.4	%		0.8	%
Expected dividend yield		None			None			None			None
Expected volatility		30.7	%		30.7	%		30.7	%		30.7	%
Expected term (years)		4.5			4.6			4.6			4.6
Fair value, per share	$	23.58		$	19.40		$	23.21		$	19.47

Schedule of weighted-average assumptions for ESPP subscriptions granted

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Average risk-free interest rate		0.1	%		0.1	%		0.1	%		0.1	%
Expected dividend yield		None			None			None			None
Expected volatility		29.2	%		33.3	%		31.3	%		35.4	%
Expected term (years)		0.7			0.7			0.7			0.7
Fair value, per share	$	18.33		$	21.48		$	16.96		$	22.94

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STOCK-BASED COMPENSATION (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Allocation of stock-based compensation expense
Stock-based compensation expense	$ 11.9	$ 12.8	$ 23.9	$ 24.0
Unrecognized compensation expense related to nonvested stock options, restricted stock units, market-based restricted stock units and employee stock purchase subscriptions	100.8		100.8
Period over which unrecognized compensation expense is expected to be recognized			32 months
Cost of sales
Allocation of stock-based compensation expense
Stock-based compensation expense	1.5	1.5	3.0	2.9
Selling, general and administrative expenses
Allocation of stock-based compensation expense
Stock-based compensation expense	8.6	9.4	17.4	17.6
Research and development expenses
Allocation of stock-based compensation expense
Stock-based compensation expense	$ 1.8	$ 1.9	$ 3.5	$ 3.5

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CHANGE IN ACCOUNTING PRINCIPLE (Tables)

6 Months Ended

Jun. 30, 2014

CHANGE IN ACCOUNTING PRINCIPLE

Schedule of effects of retrospective application of change in accounting principle

The following tables present the effects of the retrospective application of the change in accounting principle (in millions):

	As of December 31, 2013
Consolidated Condensed Balance Sheet	As Reported		As Adjusted
Other intangible assets, net	$	57.2	$	33.5
Deferred income taxes		70.1		79.0
Total assets		2,724.7		2,709.9
Retained earnings		2,045.6		2,030.8
Total stockholders' equity		1,559.2		1,544.4
Total liabilities and stockholders' equity		2,724.7		2,709.9

	Three Months Ended June 30, 2013				Six Months Ended June 30, 2013
Consolidated Condensed Statement of Operations	As Reported		As Adjusted		As Reported			As Adjusted
Cost of sales	$	125.0	$	123.6	$	247.2		$	244.6
Gross profit		392.2		393.6		766.7			769.3
Selling, general and administrative expenses(a)		189.4		186.6		374.6			369.0
Intellectual property litigation expense (income), net(a)		—		5.5		—			(72.6	)
Special gain(a)		—		—		(83.6	)		—
Income before provision for income taxes		121.8		120.5		313.9			311.1
Provision for income taxes		27.7		27.2		74.9			73.9
Net income		94.1		93.3		239.0			237.2
Earnings per share:
Basic	$	0.84	$	0.83	$	2.11		$	2.09
Diluted	$	0.82	$	0.81	$	2.07		$	2.05

(a)

The above amounts also reflect certain reclassifications of previously reported amounts related to intellectual property litigation to conform to classifications used in the current year.

	Three Months Ended June 30, 2013				Six Months Ended June 30, 2013
Consolidated Condensed Statement of Comprehensive Income	As Reported		As Adjusted		As Reported		As Adjusted
Net income	$	94.1	$	93.3	$	239.0	$	237.2
Comprehensive income		98.1		97.3		228.9		227.1

	Six Months Ended June 30, 2013
Consolidated Condensed Statement of Cash Flows	As Reported			As Adjusted
Net income	$	239.0		$	237.2
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		31.4			28.8
Other		1.1			0.8
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		26.2			25.2
Other		(5.4	)		0.3

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FAIR VALUE MEASUREMENTS (Details) (Fair value, Level 2, USD $) In Millions, unless otherwise specified	Jun. 30, 2014
Fair value | Level 2
Financial instruments
Fair value of notes payable	$ 617.4

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SPECIAL CHARGES (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended	6 Months Ended	1 Months Ended
	Jun. 30, 2014	Jun. 30, 2014	Mar. 31, 2014 Intellectual property agreement
Licensing of intellectual property
Special charges (Note 4)	$ 50.0	$ 57.5	$ 7.5

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BASIS OF PRESENTATION (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Net cash used in investing activities	$ 590.2	$ 59.3
Restatement adjustment
Net cash used in investing activities		$ 14.9

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2014 Foreign currency forward exchange contracts	Dec. 31, 2013 Foreign currency forward exchange contracts	Jun. 30, 2014 Interest rate swap agreements	Dec. 31, 2013 Interest rate swap agreements
Derivative Financial Instruments
Notional Amount		$ 805.3	$ 805.5	$ 300.0	$ 300.0
Maximum period of time currency rate movements in future cash flows associated with intercompany transactions and certain third-party expenses are hedged	13 months

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EARNINGS PER SHARE (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Basic:
Net income	$ 547.0	$ 93.3	$ 607.3	$ 237.2
Weighted-average shares outstanding	105.6	112.6	106.1	113.3
Basic earnings per share (in dollars per share)	$ 5.18	$ 0.83	$ 5.72	$ 2.09
Diluted:
Net income	$ 547.0	$ 93.3	$ 607.3	$ 237.2
Weighted-average shares outstanding	105.6	112.6	106.1	113.3
Dilutive effect of stock plans (in shares)	1.8	2.1	1.8	2.3
Dilutive weighted-average shares outstanding	107.4	114.7	107.9	115.6
Diluted earnings per share (in dollars per share)	$ 5.09	$ 0.81	$ 5.63	$ 2.05

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OTHER INTANGIBLE ASSETS (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Amortizable intangible assets
Cost	$ 240.2	$ 235.6
Accumulated Amortization	(210.7)	(206.7)
Net Carrying Value	29.5	28.9
Unamortizable intangible assets
Gross intangible Assets	240.2	240.2
Total Net Carrying Amount of Intangible Assets	29.5	33.5
In-process research and development
Unamortizable intangible assets
Net Carrying Value		4.6
Patents
Amortizable intangible assets
Cost	181.5	181.6
Accumulated Amortization	(166.3)	(163.5)
Net Carrying Value	15.2	18.1
Developed technology
Amortizable intangible assets
Cost	48.0	43.3
Accumulated Amortization	(36.0)	(35.1)
Net Carrying Value	12.0	8.2
Other
Amortizable intangible assets
Cost	10.7	10.7
Accumulated Amortization	(8.4)	(8.1)
Net Carrying Value	$ 2.3	$ 2.6

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INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET

6 Months Ended

Jun. 30, 2014

INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET

INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET

3.     INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET

        In May 2014, the Company entered into an agreement with Medtronic, Inc. and its affiliates ("Medtronic") to settle all outstanding patent litigation between the companies, including all cases related to transcatheter heart valves. Pursuant to the agreement, all pending cases or appeals in courts and patent offices worldwide have been dismissed, and the parties will not litigate patent disputes with each other in the field of transcatheter valves for the eight-year term of the agreement. Under the terms of a patent cross-license that is part of the agreement, Medtronic made a one-time, upfront payment to the Company in the amount of $750.0 million. In addition, Medtronic will pay the Company quarterly license royalty payments through April 2022. For sales in the United States, the royalty payments will be based on a percentage of Medtronic's sales of transcatheter aortic valves, subject to a minimum annual payment of $40.0 million and a maximum annual payment of $60.0 million. A separate royalty payment will be calculated based on sales of Medtronic transcatheter aortic valves manufactured in the United States but sold elsewhere. For further information, see Note 13.

        The Company accounted for the settlement agreement as a multiple-element arrangement and allocated the total consideration to the identifiable elements based upon their relative fair value. The consideration assigned to each element was as follows:

Past damages	$	754.3
License agreement		238.0
Covenant not to sue		77.7
Total	$	1,070.0

        The Company recognized the upfront payment of $750.0 million in "Intellectual Property Litigation (Income) Expense, net" during the second quarter of 2014. The accounting guidance limits the amount to be recognized upfront to the amount of cash received. Therefore, the remaining fair value associated with the past damages element, and the amounts assigned to the license agreement and covenant not to sue, will be recognized in "Net Sales" over the term of the license agreement as delivery occurs since the Company considers the future royalties to be part of its revenue-earning activities that constitute its ongoing major or central operations.

        The Company incurred external legal costs related to intellectual property litigation of $2.6 million and $5.5 million for the three months ended June 30, 2014 and 2013, respectively, and $8.1 million and $11.0 million for the six months ended June 30, 2014 and 2013, respectively.

        In February 2013, the Company received $83.6 million from Medtronic in satisfaction of the initial April 2010 jury award of damages for infringement of the United States Andersen transcatheter heart valve patent, including accrued interest.

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EARNINGS PER SHARE (Details 2) (Stock compensation plan) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Stock compensation plan
Anti-dilutive securities
Anti-dilutive securities excluded from the computation of earnings per share (in shares)	4.4	3.7	4.0	3.0

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INVENTORIES (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Inventories
Raw materials	$ 60.4	$ 57.8
Work in process	79.1	82.2
Finished products	177.6	168.9
Total inventories	$ 317.1	$ 308.9

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OTHER INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2014

OTHER INTANGIBLE ASSETS

Schedule of other intangible assets

Other intangible assets consisted of the following (in millions):

	June 30, 2014							December 31, 2013
	Cost		Accumulated Amortization			Net Carrying Value		Cost		Accumulated Amortization			Net Carrying Value
Amortizable intangible assets
Patents	$	181.5	$	(166.3	)	$	15.2	$	181.6	$	(163.5	)	$	18.1
Developed technology		48.0		(36.0	)		12.0		43.3		(35.1	)		8.2
Other		10.7		(8.4	)		2.3		10.7		(8.1	)		2.6
		240.2		(210.7	)		29.5		235.6		(206.7	)		28.9
Unamortizable intangible assets
In-process research and development		—		—			—		4.6		—			4.6
	$	240.2	$	(210.7	)	$	29.5	$	240.2	$	(206.7	)	$	33.5

Schedule of estimated amortization expense

Estimated amortization expense for each of the years ending December 31 is as follows (in millions):

2014	$	8.5
2015		7.8
2016		7.6
2017		6.9
2018		1.6

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INVESTMENTS (Tables)

6 Months Ended

Jun. 30, 2014

INVESTMENTS

Schedule of held-to-maturity investments

Held-to-maturity investments at the end of each period were as follows (in millions):

	June 30, 2014								December 31, 2013
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Bank time deposits	$	886.3	$	—	$	—	$	886.3	$	516.5	$	—	$	—	$	516.5
Commercial paper		89.8		—		—		89.8		—		—		—		—
U.S. government and agency securities		50.8		0.1		—		50.9		—		—		—		—
Asset-backed securities		9.4		—		—		9.4		—		—		—		—
Corporate debt securities		25.0		—		—		25.0		—		—		—		—
Municipal securities		5.1		—		—		5.1		—		—		—		—
Total	$	1,066.4	$	0.1	$	—	$	1,066.5	$	516.5	$	—	$	—	$	516.5

Schedule of cost and fair value of held-to-maturity investments, by contractual maturity

The cost and fair value of held-to-maturity investments, by contractual maturity, as of June 30, 2014 were as follows:

	Cost		Fair Value
	(in millions)
Due in 1 year or less	$	985.5	$	985.5
Due after 1 year through 5 years		63.6		63.7
Instruments not due at a single maturity date		17.3		17.3
	$	1,066.4	$	1,066.5

Schedule of investments in unconsolidated affiliates

	June 30, 2014			December 31, 2013
	(in millions)
Available-for-sale investments
Cost	$	0.4		$	0.4
Unrealized gains		0.1			0.4
Fair value of available-for-sale investments		0.5			0.8
Equity method investments
Cost		12.4			14.1
Equity in losses		(1.5	)		(2.7	)
Carrying value of equity method investments		10.9			11.4
Cost method investments
Carrying value of cost method investments		6.7			9.7
Total investments in unconsolidated affiliates	$	18.1		$	21.9

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DEFINED BENEFIT PLANS (Details) (Defined benefit pension plans, USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Defined benefit pension plans
Components of net periodic benefit cost
Service cost	$ 1.8	$ 1.9	$ 3.5	$ 3.9
Interest cost	0.6	0.5	1.2	1.0
Expected return on plan assets	(0.5)	(0.3)	(0.9)	(0.6)
Amortization of actuarial loss, prior service credit and other		0.3	0.1	0.5
Net periodic benefit cost	$ 1.9	$ 2.4	$ 3.9	$ 4.8

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INVESTMENTS (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Held-to-maturity investments
Cost	$ 1,066.4	$ 516.5
Gross Unrealized Gains	0.1
Total	1,066.5	516.5
Bank time deposits
Held-to-maturity investments
Cost	886.3	516.5
Total	886.3	516.5
Commercial paper
Held-to-maturity investments
Cost	89.8
Total	89.8
U.S. government and agency securities
Held-to-maturity investments
Cost	50.8
Gross Unrealized Gains	0.1
Total	50.9
Asset-backed securities
Held-to-maturity investments
Cost	9.4
Total	9.4
Corporate debt securities
Held-to-maturity investments
Cost	25.0
Total	25.0
Municipal securities
Held-to-maturity investments
Cost	5.1
Total	$ 5.1

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FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2014

FAIR VALUE MEASUREMENTS

Summary of financial instruments measured at fair value on a recurring basis

The following table summarizes the Company's financial instruments which are measured at fair value on a recurring basis (in millions):

June 30, 2014	Level 1		Level 2		Level 3		Total
Assets
Investments held for deferred compensation plans	$	26.5	$	—	$	—	$	26.5
Available-for-sale investments		0.5		—		—		0.5
Derivatives		—		3.9		—		3.9
	$	27.0	$	3.9	$	—	$	30.9
Liabilities
Derivatives	$	—	$	7.1	$	—	$	7.1
Deferred compensation plans		26.5		—		—		26.5
	$	26.5	$	7.1	$	—	$	33.6
December 31, 2013
Assets
Investments held for deferred compensation plans	$	15.1	$	—	$	—	$	15.1
Available-for-sale investments		0.8		—		—		0.8
Derivatives		—		13.8		—		13.8
	$	15.9	$	13.8	$	—	$	29.7
Liabilities
Derivatives	$	—	$	17.2	$	—	$	17.2
Deferred compensation plans		15.5		—		—		15.5
	$	15.5	$	17.2	$	—	$	32.7

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2014

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

Summary of derivative financial instruments used to manage currency exchange rate risk and interest rate risk

	Notional Amount
	June 30, 2014		December 31, 2013
	(in millions)
Foreign currency forward exchange contracts	$	805.3	$	805.5
Interest rate swap agreements	$	300.0	$	300.0

Schedule of location and fair value amounts of derivative instruments reported in the consolidated condensed balance sheets

The following table presents the location and fair value amounts of derivative instruments reported in the consolidated condensed balance sheets (in millions):

		Fair Value
Derivatives designated as hedging instruments	Balance Sheet Location	June 30, 2014		December 31, 2013
Assets
Foreign currency contracts	Other current assets	$	3.2	$	13.8
Interest rate swap agreements	Other assets	$	0.7	$	—
Liabilities
Foreign currency contracts	Accrued and other liabilities	$	7.1	$	13.2
Interest rate swap agreements	Other long-term liabilities	$	—	$	4.0

Schedule of effect of master-netting agreements and rights of offset on the consolidated condensed balance sheets

 The following table presents the effect of master-netting agreements and rights of offset on the consolidated condensed balance sheets (in millions):

							Gross Amounts Not Offset in the Consolidated Balance Sheet
			Gross Amounts Offset in the Consolidated Balance Sheet
					Net Amounts Presented in the Consolidated Balance Sheet
June 30, 2014	Gross Amounts						Financial Instruments			Cash Collateral Received		Net Amount
Derivative Assets
Foreign currency contracts	$	3.2	$	—	$	3.2	$	(3.2	)	$	—	$	—
Interest rate swap agreements	$	0.7	$	—	$	0.7	$	—		$	—	$	0.7
Derivative Liabilities
Foreign currency contracts	$	7.1	$	—	$	7.1	$	(3.2	)	$	—	$	3.9
December 31, 2013
Derivative Assets
Foreign currency contracts	$	13.8	$	—	$	13.8	$	(9.5	)	$	—	$	4.3
Derivative Liabilities
Foreign currency contracts	$	13.2	$	—	$	13.2	$	(9.5	)	$	—	$	3.7
Interest rate swap agreements	$	4.0	$	—	$	4.0	$	—		$	—	$	4.0

Schedule of effect of derivative instruments on the consolidated condensed statements of operations and consolidated condensed statements of comprehensive income

The following tables present the effect of derivative instruments on the consolidated condensed statements of operations and consolidated condensed statements of comprehensive income (in millions):

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income
	Three Months Ended June 30,						Three Months Ended June 30,
						Location of Gain or (Loss) Reclassified from Accumulated OCI into Income
Derivatives in cash flow hedging relationships	2014			2013			2014		2013
Foreign currency contracts	$	(2.7	)	$	6.0	Cost of sales	$	3.0	$	5.8

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income
	Six Months Ended June 30,						Six Months Ended June 30,
						Location of Gain or (Loss) Reclassified from Accumulated OCI into Income
Derivatives in cash flow hedging relationships	2014			2013			2014		2013
Foreign currency contracts	$	(4.4	)	$	27.7	Cost of sales	$	8.0	$	11.0

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Three Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives in fair value hedging relationships		2014		2013
Interest rate swap agreements	Interest expense, net	$	2.6	$	—

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Six Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives in fair value hedging relationships		2014		2013
Interest rate swap agreements	Interest expense, net	$	4.7	$	—

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Three Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives not designated as hedging instruments		2014			2013
Foreign currency contracts	Other expense, net	$	(2.5	)	$	5.1

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Six Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives not designated as hedging instruments		2014			2013
Foreign currency contracts	Other expense, net	$	(3.2	)	$	14.4

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CHANGE IN ACCOUNTING PRINCIPLE

6 Months Ended

Jun. 30, 2014

CHANGE IN ACCOUNTING PRINCIPLE

CHANGE IN ACCOUNTING PRINCIPLE

2.     CHANGE IN ACCOUNTING PRINCIPLE

        Effective January 1, 2014, the Company changed its method of accounting for certain intellectual property litigation expenses related to the defense and enforcement of issued patents. Previously, the Company capitalized these legal costs if a favorable outcome in the patent defense was determined to be probable, and amortized the capitalized legal costs over the life of the related patent. As of December 31, 2013, the Company had remaining unamortized capitalized legal costs of $23.7 million, which, under the previous accounting method, would have been amortized through 2021. Under the new method of accounting, these legal costs are expensed in the period they are incurred. The Company has retrospectively adjusted the comparative financial statements of prior periods to apply this new method of accounting.

        The Company believes this change in accounting principle is preferable because (1) as more competitors enter the Company's key product markets and the threat of complex intellectual property litigation across multiple jurisdictions increases, it will become more difficult for the Company to accurately assess the probability of a favorable outcome in such litigation, and (2) it will enhance the comparability of the Company's financial results with those of its peer group because it is the predominant accounting practice in the Company's industry.

        The accompanying consolidated condensed financial statements and related notes have been adjusted to reflect the impact of this change retrospectively to all prior periods presented. The cumulative effect of the change in accounting principle was a decrease in retained earnings of $12.2 million as of January 1, 2013. The following tables present the effects of the retrospective application of the change in accounting principle (in millions):

	As of December 31, 2013
Consolidated Condensed Balance Sheet	As Reported		As Adjusted
Other intangible assets, net	$	57.2	$	33.5
Deferred income taxes		70.1		79.0
Total assets		2,724.7		2,709.9
Retained earnings		2,045.6		2,030.8
Total stockholders' equity		1,559.2		1,544.4
Total liabilities and stockholders' equity		2,724.7		2,709.9

	Three Months Ended June 30, 2013				Six Months Ended June 30, 2013
Consolidated Condensed Statement of Operations	As Reported		As Adjusted		As Reported			As Adjusted
Cost of sales	$	125.0	$	123.6	$	247.2		$	244.6
Gross profit		392.2		393.6		766.7			769.3
Selling, general and administrative expenses(a)		189.4		186.6		374.6			369.0
Intellectual property litigation expense (income), net(a)		—		5.5		—			(72.6	)
Special gain(a)		—		—		(83.6	)		—
Income before provision for income taxes		121.8		120.5		313.9			311.1
Provision for income taxes		27.7		27.2		74.9			73.9
Net income		94.1		93.3		239.0			237.2
Earnings per share:
Basic	$	0.84	$	0.83	$	2.11		$	2.09
Diluted	$	0.82	$	0.81	$	2.07		$	2.05

(a)

The above amounts also reflect certain reclassifications of previously reported amounts related to intellectual property litigation to conform to classifications used in the current year.

	Three Months Ended June 30, 2013				Six Months Ended June 30, 2013
Consolidated Condensed Statement of Comprehensive Income	As Reported		As Adjusted		As Reported		As Adjusted
Net income	$	94.1	$	93.3	$	239.0	$	237.2
Comprehensive income		98.1		97.3		228.9		227.1

	Six Months Ended June 30, 2013
Consolidated Condensed Statement of Cash Flows	As Reported			As Adjusted
Net income	$	239.0		$	237.2
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		31.4			28.8
Other		1.1			0.8
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		26.2			25.2
Other		(5.4	)		0.3

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DEFINED BENEFIT PLANS (Tables)

6 Months Ended

Jun. 30, 2014

DEFINED BENEFIT PLANS

Components of net periodic benefit cost

The components of net periodic benefit cost for the three and six months ended June 30, 2014 and 2013 were as follows (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Service cost	$	1.8		$	1.9		$	3.5		$	3.9
Interest cost		0.6			0.5			1.2			1.0
Expected return on plan assets		(0.5	)		(0.3	)		(0.9	)		(0.6	)
Amortization of actuarial loss, prior service credit and other		—			0.3			0.1			0.5
Net periodic benefit cost	$	1.9		$	2.4		$	3.9		$	4.8

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INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET (Details 2) (USD $) In Millions, unless otherwise specified	1 Months Ended	3 Months Ended		6 Months Ended
	Feb. 28, 2013 CoreValve, Inc.	Jun. 30, 2014 Intellectual property	Jun. 30, 2013 Intellectual property	Jun. 30, 2014 Intellectual property	Jun. 30, 2013 Intellectual property
Litigation (income) expense
External legal costs related to intellectual property litigation		$ 2.6	$ 5.5	$ 8.1	$ 11.0
Amount of payment received from Medtronic in satisfaction of initial April 2010 jury award of damages for infringement, including accrued interest	$ 83.6

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details 2) (Designated as hedging instruments, USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Foreign currency contracts | Other current assets
Derivatives designated as hedging instruments
Fair value of derivative assets	$ 3.2	$ 13.8
Foreign currency contracts | Accrued and other liabilities
Derivatives designated as hedging instruments
Fair value of derivative liabilities	7.1	13.2
Interest rate swap agreements | Other assets
Derivatives designated as hedging instruments
Fair value of derivative assets	0.7
Interest rate swap agreements | Other long-term liabilities
Derivatives designated as hedging instruments
Fair value of derivative liabilities		$ 4.0

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CONSOLIDATED CONDENSED BALANCE SHEETS (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Current assets
Cash and cash equivalents	$ 498.6	$ 420.4
Short-term investments (Note 6)	985.5	516.5
Accounts and other receivables, net of allowances of $5.6 and $5.4, respectively	327.5	328.0
Inventories (Note 5)	317.1	308.9
Deferred income taxes	42.8	33.4
Prepaid expenses	46.3	46.8
Other current assets	60.3	71.8
Total current assets	2,278.1	1,725.8
Long-term accounts receivable, net of allowances of $6.7 and $6.8, respectively	7.6	7.3
Long-term investments (Note 6)	99.0	21.9
Property, plant and equipment, net	422.5	421.6
Goodwill	384.3	385.4
Other intangible assets, net (Note 7)	29.5	33.5
Deferred income taxes	69.9	79.0
Other assets	35.7	35.4
Total assets	3,326.6	2,709.9
Current liabilities
Accounts payable and accrued liabilities	540.5	345.6
Long-term debt (Note 8)	598.0	593.1
Other long-term liabilities	273.2	226.8
Commitments and contingencies (Note 13)
Stockholders' equity
Preferred stock, $.01 par value, authorized 50.0 shares, no shares outstanding
Common stock, $1.00 par value, 350.0 shares authorized, 127.1 and 126.0 shares issued, and 106.0 and 109.3 shares outstanding, respectively	127.1	126.0
Additional paid-in capital	747.4	671.2
Retained earnings	2,638.1	2,030.8
Accumulated other comprehensive loss	(41.1)	(27.6)
Treasury stock, at cost, 21.1 and 16.7 shares, respectively	(1,556.6)	(1,256.0)
Total stockholders' equity	1,914.9	1,544.4
Total liabilities and stockholders' equity	$ 3,326.6	$ 2,709.9

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INVESTMENTS (Details 2) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Cost
Due in 1 year or less	$ 985.5
Due after 1 year through 5 years	63.6
Instruments not due at a single maturity date	17.3
Total	1,066.4	516.5
Fair Value
Due in 1 year or less	985.5
Due after 1 year through 5 years	63.7
Instruments not due at a single maturity date	17.3
Total	$ 1,066.5	$ 516.5

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CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Cash flows from operating activities
Net income	$ 607.3	$ 237.2
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	32.3	28.8
Stock-based compensation (Note 12)	23.9	24.0
Excess tax benefit from stock plans	(21.3)	(58.9)
Special charges (Note 4)	7.5
Loss (gain) on investments	3.3	(0.4)
Deferred income taxes	2.0	0.7
Other	(2.0)	0.8
Changes in operating assets and liabilities:
Accounts and other receivables, net	(0.2)	(8.7)
Inventories	(11.5)	(31.7)
Accounts payable and accrued liabilities	282.7	11.9
Prepaid expenses and other current assets	(10.8)	25.2
Other	3.7	0.3
Net cash provided by operating activities	916.9	229.2
Cash flows from investing activities
Capital expenditures	(30.3)	(66.3)
Purchases of held-to-maturity investments	(1,146.5)	(222.0)
Proceeds from held-to-maturity investments	594.9	230.9
Investments in trading securities, net	(10.9)	(0.2)
Proceeds from (investments in) unconsolidated affiliates, net	1.3	(1.6)
Other	1.3	(0.1)
Net cash used in investing activities	(590.2)	(59.3)
Cash flows from financing activities
Proceeds from issuance of debt	214.1	332.2
Payments on debt	(212.9)	(292.0)
Purchases of treasury stock	(300.6)	(246.6)
Excess tax benefit from stock plans	21.3	58.9
Proceeds from stock plans	32.9	27.4
Other	(2.4)	5.9
Net cash used in financing activities	(247.6)	(114.2)
Effect of currency exchange rate changes on cash and cash equivalents	(0.9)	6.1
Net increase in cash and cash equivalents	78.2	61.8
Cash and cash equivalents at beginning of period	420.4	310.9
Cash and cash equivalents at end of period	498.6	372.7
Non-cash investing and financing transactions:
Capital expenditures accruals	$ 8.2	$ 2.9

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ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2014 Foreign Currency Translation Adjustments	Jun. 30, 2014 Unrealized Gain (Loss) on Cash Flow Hedges	Jun. 30, 2014 Unrealized Gain on Available-for-Sale Investments	Jun. 30, 2014 Unrealized Pension Costs	Dec. 31, 2013 Unrealized Pension Costs
Changes in accumulated other comprehensive loss components
Balance at the beginning of the period	$ (27.6)	$ (20.2)	$ 3.5	$ 0.3	$ (11.2)	$ (11.2)
Other comprehensive loss before reclassifications	(10.9)	(6.2)	(4.4)	(0.3)
Amounts reclassified from accumulated other comprehensive loss	(7.7)		(8.0)	0.3
Deferred income tax benefit	5.1		5.0	0.1
Balance at the end of the period	$ (41.1)	$ (26.4)	$ (3.9)	$ 0.4	$ (11.2)	$ (11.2)

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EARNINGS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2014

EARNINGS PER SHARE

Schedule of computation of basic and diluted earnings per share

The table below presents the computation of basic and diluted earnings per share (in millions, except for per share information):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Basic:
Net income	$	547.0	$	93.3	$	607.3	$	237.2
Weighted-average shares outstanding		105.6		112.6		106.1		113.3
Basic earnings per share	$	5.18	$	0.83	$	5.72	$	2.09
Diluted:
Net income	$	547.0	$	93.3	$	607.3	$	237.2
Weighted-average shares outstanding		105.6		112.6		106.1		113.3
Dilutive effect of stock plans		1.8		2.1		1.8		2.3
Dilutive weighted-average shares outstanding		107.4		114.7		107.9		115.6
Diluted earnings per share	$	5.09	$	0.81	$	5.63	$	2.05

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SEGMENT INFORMATION (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	$ 575.1	$ 517.2	$ 1,097.5	$ 1,013.9
Long-lived Tangible Assets by Geographic Area
Long-lived tangible assets	458.2		458.2		457.0
Transcatheter Heart Valves
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	219.7	182.1	408.9	351.8
Surgical Heart Valve Therapy
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	214.0	204.3	416.6	402.4
Critical Care
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	141.4	130.8	272.0	259.7
United States
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	242.0	240.5	464.4	468.4
Long-lived Tangible Assets by Geographic Area
Long-lived tangible assets	310.7		310.7		308.2
Europe
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	193.8	155.3	374.1	309.8
Long-lived Tangible Assets by Geographic Area
Long-lived tangible assets	41.8		41.8		40.9
Japan
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	66.7	59.3	125.4	119.3
Long-lived Tangible Assets by Geographic Area
Long-lived tangible assets	10.0		10.0		10.8
Rest of World
Net Sales by Geographic Area and by Major Product and Service Area
Net sales	72.6	62.1	133.6	116.4
Long-lived Tangible Assets by Geographic Area
Long-lived tangible assets	$ 95.7		$ 95.7		$ 97.1

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INCOME TAXES

6 Months Ended

Jun. 30, 2014

INCOME TAXES

INCOME TAXES

16.   INCOME TAXES

        The Company's effective income tax rates were 32.7% and 22.6% for the three months ended June 30, 2014 and 2013, respectively, and 31.8% and 23.8% for the six months ended June 30, 2014 and 2013, respectively.

        The effective tax rate for the three and six months ended June 30, 2014 included (1) $262.1 million of tax expense associated with a $750.0 million litigation settlement payment received from Medtronic in May 2014 (see Note 3) and (2) $6.2 million of tax benefits from the remeasurement of uncertain tax positions.

        The federal research credit expired on December 31, 2013 and has not been reinstated as of June 30, 2014. Therefore, the effective income tax rates for the three and six months ended June 30, 2014 were calculated without an assumed benefit for the federal research credit. In 2013, the federal research credit related to 2013 favorably impacted the effective tax rate by approximately 1.3%. The effective income tax rate for the six months ended June 30, 2013 included (1) an $8.4 million benefit for the full year 2012 federal research credit, which was reinstated on January 2, 2013 and (2) $31.3 million of tax expense associated with the $83.6 million litigation award received from Medtronic in February 2013 (see Note 3).

        The Company strives to resolve open matters with each tax authority at the examination level and could reach agreement with a tax authority at any time. While the Company has accrued for matters it believes are more likely than not to require settlement, the final outcome with a tax authority may result in a tax liability that is more or less than that reflected in the consolidated condensed financial statements. Furthermore, the Company may later decide to challenge any assessments, if made, and may exercise its right to appeal. The uncertain tax positions are reviewed quarterly and adjusted as events occur that affect potential liabilities for additional taxes, such as lapsing of applicable statutes of limitations, proposed assessments by tax authorities, negotiations between tax authorities, identification of new issues and issuance of new legislation, regulations or case law.

        As of June 30, 2014 and December 31, 2013, the liability for income taxes associated with uncertain tax positions was $172.0 million and $127.7 million, respectively. The Company estimates that these liabilities would be reduced by $30.3 million and $30.9 million, respectively, from offsetting tax benefits associated with the correlative effects of potential transfer pricing adjustments, state income taxes and timing adjustments. The net amounts of $141.7 million and $96.8 million, respectively, if not required, would favorably affect the Company's effective tax rate.

        At June 30, 2014, all material state, local and foreign income tax matters have been concluded for years through 2006. During the third quarter of 2013, the Internal Revenue Service ("IRS") completed its fieldwork for the 2009 and 2010 tax years. The case is currently in suspense pending finalization of an Advance Pricing Agreement ("APA") and Joint Committee of Taxation approval. The IRS began its examination of the 2011 and 2012 tax years during the fourth quarter of 2013. The Company has also entered into an APA process between the Switzerland and United States governments for the years 2009 through 2013 covering transfer pricing matters. The transfer pricing matters are significant to the Company's consolidated condensed financial statements, and the final outcome of the negotiations between the two governments is uncertain.

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SEGMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2014

SEGMENT INFORMATION

Information about reportable segments

The table below presents information about Edwards Lifesciences' reportable segments (in millions):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Segment Net Sales
United States	$	242.0	$	240.5	$	464.4	$	468.4
Europe		188.3		160.7		363.9		316.2
Japan		68.2		73.0		128.4		140.3
Rest of World		75.1		63.1		138.8		117.6
Total segment net sales	$	573.6	$	537.3	$	1,095.5	$	1,042.5
Segment Pre-tax Income
United States	$	131.2	$	142.7	$	249.6	$	275.5
Europe		87.7		73.7		167.9		146.2
Japan		31.9		36.9		59.5		70.4
Rest of World		23.7		17.5		40.0		30.0
Total segment pre-tax income	$	274.5	$	270.8	$	517.0	$	522.1

Reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income

The table below presents reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Net Sales Reconciliation
Segment net sales	$	573.6		$	537.3		$	1,095.5		$	1,042.5
Foreign currency		1.5			(20.1	)		2.0			(28.6	)
Consolidated net sales	$	575.1		$	517.2		$	1,097.5		$	1,013.9
Pre-tax Income Reconciliation
Segment pre-tax income	$	274.5		$	270.8		$	517.0		$	522.1
Unallocated amounts:
Corporate items		(158.1	)		(143.3	)		(312.7	)		(283.0	)
Special charges (Note 4)		(50.0	)		—			(57.5	)		—
Intellectual property litigation income (expense), net (Note 3)		747.4			(5.5	)		741.9			72.6
Interest expense, net		(3.1	)		(0.4	)		(6.6	)		(0.2	)
Foreign currency		2.5			(1.1	)		8.4			(0.4	)
Consolidated pre-tax income	$	813.2		$	120.5		$	890.5		$	311.1

Enterprise-wide information

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(in millions)
Net Sales by Geographic Area
United States	$	242.0	$	240.5	$	464.4	$	468.4
Europe		193.8		155.3		374.1		309.8
Japan		66.7		59.3		125.4		119.3
Rest of World		72.6		62.1		133.6		116.4
	$	575.1	$	517.2	$	1,097.5	$	1,013.9
Net Sales by Major Product and Service Area
Transcatheter Heart Valves	$	219.7	$	182.1	$	408.9	$	351.8
Surgical Heart Valve Therapy		214.0		204.3		416.6		402.4
Critical Care		141.4		130.8		272.0		259.7
	$	575.1	$	517.2	$	1,097.5	$	1,013.9

	June 30, 2014		December 31, 2013
	(in millions)
Long-lived Tangible Assets by Geographic Area
United States	$	310.7	$	308.2
Europe		41.8		40.9
Japan		10.0		10.8
Rest of World		95.7		97.1
	$	458.2	$	457.0

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BASIS OF PRESENTATION (Policies)

6 Months Ended

Jun. 30, 2014

BASIS OF PRESENTATION

Cash Flow Statement Revision

Cash Flow Statement Revision

        In preparing the consolidated financial statements for the year ended December 31, 2013, the Company determined that it had misclassified certain accrued capital expenditures in the consolidated condensed statements of cash flows for the six months ended June 30, 2013. The Company has evaluated and concluded that this did not result in a material misstatement of the Company's previously issued consolidated financial statements. However, the Company has elected to revise its consolidated condensed statement of cash flows for the six months ended June 30, 2013 to correct the presentation of accrued capital expenditures, resulting in an increase to net cash used in investing activities (with a corresponding increase to net cash provided by operating activities) of $14.9 million.

Recently Adopted Accounting Standards and New Accounting Standards Not Yet Adopted

Recently Adopted Accounting Standards

        In July 2013, the Financial Accounting Standards Board ("FASB") issued an amendment to the accounting guidance on income taxes impacting the presentation of unrecognized tax benefits. The guidance requires an entity to net its unrecognized tax benefits against the deferred tax assets for all same jurisdiction net operating loss or similar tax loss carryforwards, or tax credit carryforwards. The guidance was effective for annual reporting periods beginning after December 15, 2013 and interim periods therein. The adoption of this guidance did not have a material impact on the Company's consolidated condensed financial statements.

New Accounting Standards Not Yet Adopted

        In May 2014, the FASB issued an update to the accounting guidance on revenue recognition. The new guidance provides a comprehensive, principles-based approach to revenue recognition, and supersedes most previous revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires improved disclosures on the nature, amount, timing and uncertainty of revenue that is recognized. The guidance is effective for annual reporting periods beginning after December 15, 2016 and interim periods therein. The new guidance can be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of the change recognized at the date of the initial application. The Company is currently assessing the impact this guidance will have on its consolidated financial statements, and has not yet selected a transition method.

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2014

BASIS OF PRESENTATION

BASIS OF PRESENTATION

1.     BASIS OF PRESENTATION

        The accompanying interim consolidated condensed financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") and should be read in conjunction with the consolidated financial statements and notes included in Edwards Lifesciences Corporation's Annual Report on Form 10-K for the year ended December 31, 2013. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles ("GAAP") have been condensed or omitted.

        In the opinion of management of Edwards Lifesciences Corporation ("Edwards Lifesciences" or the "Company"), the interim consolidated condensed financial statements reflect all adjustments considered necessary for a fair statement of the interim periods. All such adjustments are of a normal, recurring nature. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year.

Cash Flow Statement Revision

        In preparing the consolidated financial statements for the year ended December 31, 2013, the Company determined that it had misclassified certain accrued capital expenditures in the consolidated condensed statements of cash flows for the six months ended June 30, 2013. The Company has evaluated and concluded that this did not result in a material misstatement of the Company's previously issued consolidated financial statements. However, the Company has elected to revise its consolidated condensed statement of cash flows for the six months ended June 30, 2013 to correct the presentation of accrued capital expenditures, resulting in an increase to net cash used in investing activities (with a corresponding increase to net cash provided by operating activities) of $14.9 million.

Recently Adopted Accounting Standards

        In July 2013, the Financial Accounting Standards Board ("FASB") issued an amendment to the accounting guidance on income taxes impacting the presentation of unrecognized tax benefits. The guidance requires an entity to net its unrecognized tax benefits against the deferred tax assets for all same jurisdiction net operating loss or similar tax loss carryforwards, or tax credit carryforwards. The guidance was effective for annual reporting periods beginning after December 15, 2013 and interim periods therein. The adoption of this guidance did not have a material impact on the Company's consolidated condensed financial statements.

New Accounting Standards Not Yet Adopted

        In May 2014, the FASB issued an update to the accounting guidance on revenue recognition. The new guidance provides a comprehensive, principles-based approach to revenue recognition, and supersedes most previous revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires improved disclosures on the nature, amount, timing and uncertainty of revenue that is recognized. The guidance is effective for annual reporting periods beginning after December 15, 2016 and interim periods therein. The new guidance can be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of the change recognized at the date of the initial application. The Company is currently assessing the impact this guidance will have on its consolidated financial statements, and has not yet selected a transition method.

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CONSOLIDATED CONDENSED BALANCE SHEETS (Parenthetical) (USD $) In Millions, except Per Share data, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
CONSOLIDATED CONDENSED BALANCE SHEETS
Accounts and other receivables, allowances	$ 5.6	$ 5.4
Long-term accounts receivable, allowances	$ 6.7	$ 6.8
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, authorized shares	50.0	50.0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 1.00	$ 1.00
Common stock, shares authorized	350.0	350.0
Common stock, shares issued	127.1	126.0
Common stock, shares outstanding	106.0	109.3
Treasury stock, shares	21.1	16.7

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DEFINED BENEFIT PLANS

6 Months Ended

Jun. 30, 2014

DEFINED BENEFIT PLANS

DEFINED BENEFIT PLANS

11.   DEFINED BENEFIT PLANS

        The components of net periodic benefit cost for the three and six months ended June 30, 2014 and 2013 were as follows (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Service cost	$	1.8		$	1.9		$	3.5		$	3.9
Interest cost		0.6			0.5			1.2			1.0
Expected return on plan assets		(0.5	)		(0.3	)		(0.9	)		(0.6	)
Amortization of actuarial loss, prior service credit and other		—			0.3			0.1			0.5
Net periodic benefit cost	$	1.9		$	2.4		$	3.9		$	4.8

XML

Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Jul. 31, 2014
Document and Entity Information
Entity Registrant Name	Edwards Lifesciences Corp
Entity Central Index Key	0001099800
Document Type	10-Q
Document Period End Date	Jun. 30, 2014
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		106,033,418
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2

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STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2014

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

12.   STOCK-BASED COMPENSATION

        Stock-based compensation expense related to awards issued under the Company's incentive compensation plans for the three and six months ended June 30, 2014 and 2013 was as follows (in millions):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Cost of sales	$	1.5	$	1.5	$	3.0	$	2.9
Selling, general and administrative expenses		8.6		9.4		17.4		17.6
Research and development expenses		1.8		1.9		3.5		3.5
Total stock-based compensation expense	$	11.9	$	12.8	$	23.9	$	24.0

        At June 30, 2014, the total remaining compensation cost related to nonvested stock options, restricted stock units, market-based restricted stock units and employee stock purchase plan ("ESPP") subscription awards amounted to $100.8 million, which will be amortized on a straight-line basis over the weighted-average remaining requisite service period of 32 months.

        During the six months ended June 30, 2014, the Company granted 1.3 million stock options at a weighted-average exercise price of $82.23 and 0.2 million shares of restricted stock units at a weighted-average grant-date fair value of $78.88. The Company also granted 39,000 shares of market-based restricted stock units at a weighted-average grant-date fair value of $108.75. The market-based restricted stock units vest based on a combination of certain service and market conditions. The actual number of shares issued will be determined based on the Company's total shareholder return relative to a selected industry peer group over a three-year performance period, and may range from 0% to 175% of the targeted number of shares granted.

• Fair Value Disclosures

        The fair value of the market-based restricted stock units was determined using a Monte Carlo simulation model, which uses multiple input variables to determine the probability of satisfying the market condition requirements. The weighted-average assumptions used to determine the fair value of the market-based restricted stock units granted during the six months ended June 30, 2014 and 2013 included a risk-free interest rate of 0.9% and 0.4%, respectively, and an expected volatility rate of 31.7% and 33.4%, respectively.

        The Black-Scholes option pricing model was used with the following weighted-average assumptions for options granted during the following periods:

• Option Awards

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Average risk-free interest rate		1.4	%		0.8	%		1.4	%		0.8	%
Expected dividend yield		None			None			None			None
Expected volatility		30.7	%		30.7	%		30.7	%		30.7	%
Expected term (years)		4.5			4.6			4.6			4.6
Fair value, per share	$	23.58		$	19.40		$	23.21		$	19.47

        The Black-Scholes option pricing model was used with the following weighted-average assumptions for ESPP subscriptions granted during the following periods:

• ESPP

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Average risk-free interest rate		0.1	%		0.1	%		0.1	%		0.1	%
Expected dividend yield		None			None			None			None
Expected volatility		29.2	%		33.3	%		31.3	%		35.4	%
Expected term (years)		0.7			0.7			0.7			0.7
Fair value, per share	$	18.33		$	21.48		$	16.96		$	22.94

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CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
Net sales	$ 575.1	$ 517.2	$ 1,097.5	$ 1,013.9
Cost of sales	151.2	123.6	297.1	244.6
Gross profit	423.9	393.6	800.4	769.3
Selling, general and administrative expenses	215.5	186.6	412.7	369.0
Research and development expenses	89.1	80.5	174.9	160.3
Intellectual property litigation (income) expense, net (Note 3)	(747.4)	5.5	(741.9)	(72.6)
Special charges (Note 4)	50.0		57.5
Interest expense, net	3.1	0.4	6.6	0.2
Other expense, net	0.4	0.1	0.1	1.3
Income before provision for income taxes	813.2	120.5	890.5	311.1
Provision for income taxes	266.2	27.2	283.2	73.9
Net income	$ 547.0	$ 93.3	$ 607.3	$ 237.2
Earnings per share:
Basic (in dollars per share)	$ 5.18	$ 0.83	$ 5.72	$ 2.09
Diluted (in dollars per share)	$ 5.09	$ 0.81	$ 5.63	$ 2.05
Weighted-average number of common shares outstanding:
Basic (in shares)	105.6	112.6	106.1	113.3
Diluted (in shares)	107.4	114.7	107.9	115.6

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INVESTMENTS

6 Months Ended

Jun. 30, 2014

INVESTMENTS

INVESTMENTS

6.     INVESTMENTS

• Held-to-maturity Investments

        Held-to-maturity investments at the end of each period were as follows (in millions):

	June 30, 2014								December 31, 2013
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Bank time deposits	$	886.3	$	—	$	—	$	886.3	$	516.5	$	—	$	—	$	516.5
Commercial paper		89.8		—		—		89.8		—		—		—		—
U.S. government and agency securities		50.8		0.1		—		50.9		—		—		—		—
Asset-backed securities		9.4		—		—		9.4		—		—		—		—
Corporate debt securities		25.0		—		—		25.0		—		—		—		—
Municipal securities		5.1		—		—		5.1		—		—		—		—
Total	$	1,066.4	$	0.1	$	—	$	1,066.5	$	516.5	$	—	$	—	$	516.5

        The cost and fair value of held-to-maturity investments, by contractual maturity, as of June 30, 2014 were as follows:

	Cost		Fair Value
	(in millions)
Due in 1 year or less	$	985.5	$	985.5
Due after 1 year through 5 years		63.6		63.7
Instruments not due at a single maturity date		17.3		17.3
	$	1,066.4	$	1,066.5

        Actual maturities may differ from the contractual maturities due to call or prepayment rights.

• Investments in Unconsolidated Affiliates

        The Company has a number of equity investments in privately and publicly held companies. Investments in these unconsolidated affiliates are recorded in "Long-term Investments" on the consolidated condensed balance sheets, and are as follows:

	June 30, 2014			December 31, 2013
	(in millions)
Available-for-sale investments
Cost	$	0.4		$	0.4
Unrealized gains		0.1			0.4
Fair value of available-for-sale investments		0.5			0.8
Equity method investments
Cost		12.4			14.1
Equity in losses		(1.5	)		(2.7	)
Carrying value of equity method investments		10.9			11.4
Cost method investments
Carrying value of cost method investments		6.7			9.7
Total investments in unconsolidated affiliates	$	18.1		$	21.9

        In March 2014, the Company recorded an other-than-temporary impairment charge of $3.5 million related to one of its cost method investments.

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INVENTORIES

6 Months Ended

Jun. 30, 2014

INVENTORIES

INVENTORIES

5.     INVENTORIES

        Inventories consisted of the following (in millions):

	June 30, 2014		December 31, 2013
Raw materials	$	60.4	$	57.8
Work in process		79.1		82.2
Finished products		177.6		168.9
	$	317.1	$	308.9

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SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2014

SEGMENT INFORMATION

SEGMENT INFORMATION

17.   SEGMENT INFORMATION

        Edwards Lifesciences conducts operations worldwide and is managed in the following geographical regions: United States, Europe, Japan, and Rest of World. All regions sell products that are used to treat advanced cardiovascular disease.

        The Company's geographic segments are reported based on the financial information provided to the Chief Operating Decision Maker (the Chief Executive Officer). The Company evaluates the performance of its geographic segments based on net sales and income before provision for income taxes ("pre-tax income"). The accounting policies of the segments are substantially the same as those described in Note 2 of the Company's consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2013. Segment net sales and segment pre-tax income are based on internally derived standard foreign exchange rates, which may differ from year to year, and do not include inter-segment profits. Because of the interdependence of the reportable segments, the operating profit as presented may not be representative of the geographical distribution that would occur if the segments were not interdependent. Net sales by geographic area are based on the location of the customer.

        Certain items are maintained at the corporate level and are not allocated to the segments. The non-allocated items include net interest expense, global marketing expenses, corporate research and development expenses, manufacturing variances, corporate headquarters costs, special gains and charges, stock-based compensation, foreign currency hedging activities, certain litigation costs and most of the Company's amortization expense. Although most of the Company's depreciation expense is included in segment pre-tax income, due to the Company's methodology for cost build-up, it is impractical to determine the amount of depreciation expense included in each segment, and, therefore, a portion is maintained at the corporate level. The Company neither discretely allocates assets to its operating segments, nor evaluates the operating segments using discrete asset information.

        The table below presents information about Edwards Lifesciences' reportable segments (in millions):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Segment Net Sales
United States	$	242.0	$	240.5	$	464.4	$	468.4
Europe		188.3		160.7		363.9		316.2
Japan		68.2		73.0		128.4		140.3
Rest of World		75.1		63.1		138.8		117.6
Total segment net sales	$	573.6	$	537.3	$	1,095.5	$	1,042.5
Segment Pre-tax Income
United States	$	131.2	$	142.7	$	249.6	$	275.5
Europe		87.7		73.7		167.9		146.2
Japan		31.9		36.9		59.5		70.4
Rest of World		23.7		17.5		40.0		30.0
Total segment pre-tax income	$	274.5	$	270.8	$	517.0	$	522.1

        The table below presents reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Net Sales Reconciliation
Segment net sales	$	573.6		$	537.3		$	1,095.5		$	1,042.5
Foreign currency		1.5			(20.1	)		2.0			(28.6	)
Consolidated net sales	$	575.1		$	517.2		$	1,097.5		$	1,013.9
Pre-tax Income Reconciliation
Segment pre-tax income	$	274.5		$	270.8		$	517.0		$	522.1
Unallocated amounts:
Corporate items		(158.1	)		(143.3	)		(312.7	)		(283.0	)
Special charges (Note 4)		(50.0	)		—			(57.5	)		—
Intellectual property litigation income (expense), net (Note 3)		747.4			(5.5	)		741.9			72.6
Interest expense, net		(3.1	)		(0.4	)		(6.6	)		(0.2	)
Foreign currency		2.5			(1.1	)		8.4			(0.4	)
Consolidated pre-tax income	$	813.2		$	120.5		$	890.5		$	311.1

Enterprise-Wide Information

        Enterprise-wide information is based on actual foreign exchange rates used in the Company's consolidated condensed financial statements.

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(in millions)
Net Sales by Geographic Area
United States	$	242.0	$	240.5	$	464.4	$	468.4
Europe		193.8		155.3		374.1		309.8
Japan		66.7		59.3		125.4		119.3
Rest of World		72.6		62.1		133.6		116.4
	$	575.1	$	517.2	$	1,097.5	$	1,013.9
Net Sales by Major Product and Service Area
Transcatheter Heart Valves	$	219.7	$	182.1	$	408.9	$	351.8
Surgical Heart Valve Therapy		214.0		204.3		416.6		402.4
Critical Care		141.4		130.8		272.0		259.7
	$	575.1	$	517.2	$	1,097.5	$	1,013.9

	June 30, 2014		December 31, 2013
	(in millions)
Long-lived Tangible Assets by Geographic Area
United States	$	310.7	$	308.2
Europe		41.8		40.9
Japan		10.0		10.8
Rest of World		95.7		97.1
	$	458.2	$	457.0

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2014

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

13.   COMMITMENTS AND CONTINGENCIES

        On May 19, 2014, Edwards Lifesciences entered into an agreement (the "Settlement Agreement") with Medtronic to, among other things, settle all outstanding patent litigation between the parties (see Note 3). Pursuant to the Settlement Agreement, all of the following pending cases and related appeals in courts worldwide were dismissed:

• •

  the lawsuit filed in February 2008 by Edwards Lifesciences against Medtronic in the U.S. District Court for the District of Delaware (the "District Court") alleging that its ReValving System infringes three of Edwards' U.S. Andersen patents, later narrowed to one patent;

  •

  a second lawsuit pending in the District Court against Medtronic alleging infringement of two of Edwards' U.S. Andersen patents;

  •

  the lawsuit against Medtronic in the District Court alleging infringement of an Edwards' U.S. Letac-Cribier transcatheter heart valve patent;

  •

  the lawsuit filed in June 2011 by Medtronic against Edwards Lifesciences in the U.S. District Court for the District of Minnesota alleging that certain surgical valve holders and a surgical embolic filter device infringe its patents and including Edwards' counterclaim alleging infringement of Edwards' annuloplasty ring patents;

  •

  the lawsuit filed in June 2011 by Medtronic against Edwards Lifesciences in the U.S. District Court for the Central District of California alleging that the Edwards SAPIEN transcatheter heart valve infringes a Medtronic patent, which patent was subsequently ruled invalid and the lawsuit was dismissed in favor of Edwards;

  •

  the lawsuit filed in March 2012 by Medtronic in the U.S. District Court for the Central District of California alleging that the methods of implanting the Edwards SAPIEN transcatheter heart valve in the United States infringe two Medtronic patents relating to methods of pacing the heart; and

  •

  the lawsuit filed in August 2012 by Edwards Lifesciences against Medtronic in the German District Court of Mannheim alleging that Medtronic's CoreValve and Evolut valves infringed three of Edwards' transcatheter valve patents.

        Edwards Lifesciences is or may be a party to, or may otherwise be responsible for, pending or threatened lawsuits related primarily to products and services currently or formerly manufactured or performed, as applicable, by Edwards Lifesciences. Such cases and claims raise difficult and complex factual and legal issues and are subject to many uncertainties, including, but not limited to, the facts and circumstances of each particular case or claim, the jurisdiction in which each suit is brought, and differences in applicable law. Upon resolution of any such legal matter or other claim, Edwards Lifesciences may incur charges in excess of established reserves. The Company is not able to estimate the amount or range of any loss for legal contingencies for which there is no reserve or additional loss for matters already reserved. While any such charge related to matters could have a material adverse impact on Edwards Lifesciences' net income or cash flows in the period in which it is recorded or paid, management does not believe that any such charge relating to any currently pending lawsuit would have a material adverse effect on Edwards Lifesciences' financial position, results of operations or liquidity.

        Edwards Lifesciences is subject to various environmental laws and regulations both within and outside of the United States. The operations of Edwards Lifesciences, like those of other medical device companies, involve the use of substances regulated under environmental laws, primarily in manufacturing and sterilization processes. While it is difficult to quantify the potential impact of continuing compliance with environmental protection laws, management believes that such compliance will not have a material impact on Edwards Lifesciences' financial position, results of operations or liquidity.

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FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2014

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

9.     FAIR VALUE MEASUREMENTS

        The consolidated condensed financial statements include financial instruments for which the fair market value of such instruments may differ from amounts reflected on a historical cost basis. Financial instruments of the Company consist of cash deposits, accounts and other receivables, investments, accounts payable, certain accrued liabilities and borrowings under a revolving credit agreement. The carrying value of these financial instruments generally approximates fair value due to their short-term nature. Financial instruments also include notes payable. As of June 30, 2014, the fair value of the notes payable, based on Level 2 inputs, was $617.4 million.

        Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Company prioritizes the inputs used to determine fair values in one of the following three categories:

• Level 1—Quoted market prices in active markets for identical assets or liabilities.

  Level 2—Inputs, other than quoted prices in active markets, that are observable, either directly or indirectly.

  Level 3—Unobservable inputs that are not corroborated by market data.

        In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety.

• Assets and Liabilities Measured at Fair Value on a Recurring Basis

        The following table summarizes the Company's financial instruments which are measured at fair value on a recurring basis (in millions):

June 30, 2014	Level 1		Level 2		Level 3		Total
Assets
Investments held for deferred compensation plans	$	26.5	$	—	$	—	$	26.5
Available-for-sale investments		0.5		—		—		0.5
Derivatives		—		3.9		—		3.9
	$	27.0	$	3.9	$	—	$	30.9
Liabilities
Derivatives	$	—	$	7.1	$	—	$	7.1
Deferred compensation plans		26.5		—		—		26.5
	$	26.5	$	7.1	$	—	$	33.6
December 31, 2013
Assets
Investments held for deferred compensation plans	$	15.1	$	—	$	—	$	15.1
Available-for-sale investments		0.8		—		—		0.8
Derivatives		—		13.8		—		13.8
	$	15.9	$	13.8	$	—	$	29.7
Liabilities
Derivatives	$	—	$	17.2	$	—	$	17.2
Deferred compensation plans		15.5		—		—		15.5
	$	15.5	$	17.2	$	—	$	32.7

• Deferred Compensation Plans

        The Company holds investments in trading securities related to its deferred compensation plans. The investments are in a variety of stock and bond mutual funds. The fair values of these investments and the corresponding liabilities are based on quoted market prices and are categorized as Level 1.

• Available-for-sale Investments

        The Company has a number of long-term equity investments in companies that are in various stages of development. Certain of these investments have been designated as available-for-sale. These investments are carried at fair market value based on quoted market prices and are categorized as Level 1.

• Derivative Instruments

        The Company uses derivative financial instruments in the form of foreign currency forward exchange contracts to manage foreign currency exposures and interest rate swap agreements to manage its interest rate exposures. All derivatives contracts are recognized on the balance sheet at their fair value. The fair value of foreign currency derivative financial instruments was estimated by discounting expected cash flows using quoted market interest rates and foreign exchange rates. The fair value of the interest rate swap agreements was determined based on a discounted cash flow analysis reflecting the contractual terms of the agreements and the 6-month LIBOR forward interest rate curve. Judgment was employed in interpreting market data to develop estimates of fair value; accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The use of different market assumptions or valuation methodologies could have a material effect on the estimated fair value amounts. The derivative instruments are categorized as Level 2.

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ACCUMULATED OTHER COMPREHENSIVE LOSS (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Amounts reclassified from accumulated other comprehensive loss to affected line on Consolidated Statements of Operations
Cost of sales	$ (151.2)	$ (123.6)	$ (297.1)	$ (244.6)
Other expense, net	(0.4)	(0.1)	(0.1)	(1.3)
Provision for income taxes	(266.2)	(27.2)	(283.2)	(73.9)
Net income	547.0	93.3	607.3	237.2
Gain on cash flow hedges | Amount Reclassified from Accumulated Other Comprehensive Loss
Amounts reclassified from accumulated other comprehensive loss to affected line on Consolidated Statements of Operations
Cost of sales	3.0	5.8	8.0	11.0
Provision for income taxes	(1.1)	(2.3)	(3.0)	(4.2)
Net income	1.9	3.5	5.0	6.8
Loss on available-for-sale investments | Amount Reclassified from Accumulated Other Comprehensive Loss
Amounts reclassified from accumulated other comprehensive loss to affected line on Consolidated Statements of Operations
Other expense, net	(0.3)		(0.3)
Net income	$ (0.3)		$ (0.3)

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OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2014

OTHER INTANGIBLE ASSETS

OTHER INTANGIBLE ASSETS

7.     OTHER INTANGIBLE ASSETS

        Other intangible assets consisted of the following (in millions):

	June 30, 2014							December 31, 2013
	Cost		Accumulated Amortization			Net Carrying Value		Cost		Accumulated Amortization			Net Carrying Value
Amortizable intangible assets
Patents	$	181.5	$	(166.3	)	$	15.2	$	181.6	$	(163.5	)	$	18.1
Developed technology		48.0		(36.0	)		12.0		43.3		(35.1	)		8.2
Other		10.7		(8.4	)		2.3		10.7		(8.1	)		2.6
		240.2		(210.7	)		29.5		235.6		(206.7	)		28.9
Unamortizable intangible assets
In-process research and development		—		—			—		4.6		—			4.6
	$	240.2	$	(210.7	)	$	29.5	$	240.2	$	(206.7	)	$	33.5

        The net carrying value of patents as of December 31, 2013 has been adjusted to reflect the Company's change in its method of accounting for certain legal costs related to the defense and enforcement of issued patents. For further information, see Note 2.

        In June 2014, the Company transferred its remaining in-process research and development assets, which related to technology acquired from BMEYE, B.V., to developed technology because the Company had received United States Food and Drug Administration approval for the product.

        Amortization expense related to other intangible assets was $2.0 million and $2.5 million for the three months ended June 30, 2014 and 2013, respectively, and $4.1 million and $5.0 million for the six months ended June 30, 2014 and 2013, respectively. Estimated amortization expense for each of the years ending December 31 is as follows (in millions):

2014	$	8.5
2015		7.8
2016		7.6
2017		6.9
2018		1.6

        The Company expenses costs incurred to renew or extend the term of acquired intangible assets.

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DEBT

6 Months Ended

Jun. 30, 2014

DEBT

DEBT

8.     DEBT

        In October 2013, the Company issued $600.0 million of 2.875% fixed-rate unsecured senior notes due October 15, 2018 (the "Notes"). Interest is payable semi-annually in arrears, with the first payment due in April 2014. The effective interest rate is 2.983%. Issuance costs of $5.4 million, as well as a $3.0 million discount on the Notes, are being amortized to interest expense over the term of the Notes. As of June 30, 2014, the carrying value of the Notes was $598.0 million.

        The Company has a Four-Year Credit Agreement ("Credit Facility") that matures on July 29, 2015. The Credit Facility provides for aggregate borrowings up to $750.0 million. As of June 30, 2014, there were no borrowings outstanding under the Credit Facility.

        In July 2014, the Company entered into a new Five-Year Credit Agreement ("the Credit Agreement") which matures on July 18, 2019, and the existing Credit Facility was terminated. The Credit Agreement provides up to an aggregate of $750.0 million in borrowings in multiple currencies. The Company may increase the amount available under the Credit Agreement, subject to agreement of the lenders, by up to an additional $250.0 million in the aggregate. Borrowings generally bear interest at the London interbank offered rate ("LIBOR") plus a spread ranging from 1.0% to 1.5%, depending on the leverage ratio, as defined in the Credit Agreement. The Company also pays a facility fee ranging from 0.125% to 0.25%, depending on the leverage ratio, on the entire credit commitment available, whether or not drawn. The Credit Agreement is unsecured and contains various financial and other covenants, including a maximum leverage ratio and a minimum interest coverage ratio, as defined in the Credit Agreement.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6 Months Ended

Jun. 30, 2014

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

10.   DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

        The Company uses derivative financial instruments to manage its currency exchange rate risk and its interest rate risk, as summarized below. Notional amounts are stated in United States dollar equivalents at spot exchange rates at the respective dates.

	Notional Amount
	June 30, 2014		December 31, 2013
	(in millions)
Foreign currency forward exchange contracts	$	805.3	$	805.5
Interest rate swap agreements	$	300.0	$	300.0

        The Company uses derivative financial instruments to manage interest rate and foreign currency risks. It is the Company's policy not to enter into derivative financial instruments for speculative purposes. The Company uses interest rate swaps to convert a portion of its fixed-rate debt into variable-rate debt. These interest rate swaps are designated as fair value hedges and meet the shortcut method requirements under the accounting standards for derivatives and hedging. Accordingly, changes in the fair values of the interest rate swaps are considered to exactly offset changes in the fair value of the underlying long-term debt. The Company uses foreign currency forward exchange contracts to offset the changes due to currency rate movements in the amount of future cash flows associated with intercompany transactions and certain third-party expenses expected to occur within the next 13 months. These foreign currency forward exchange contracts are designated as cash flow hedges. Certain of the Company's locations have assets and liabilities denominated in currencies other than their functional currencies resulting from intercompany and third-party transactions. The Company uses foreign currency forward exchange contracts that are not designated as hedging instruments to offset the transaction gains and losses associated with certain of these assets and liabilities. All foreign currency forward exchange contracts are denominated in currencies of major industrial countries, principally the Euro and the Japanese yen.

        All derivative financial instruments are recognized at fair value in the consolidated condensed balance sheets. For each derivative instrument that is designated and effective as a fair value hedge, the gain or loss on the derivative is recognized immediately to earnings, and offsets the loss or gain on the underlying hedged item. The gain or loss on fair value hedges is classified in net interest expense, as they hedge the interest rate risk associated with the Company's fixed-rate debt. The Company reports in "Accumulated Other Comprehensive Loss" the effective portion of the gain or loss on derivative financial instruments that are designated, and that qualify, as cash flow hedges. The Company reclassifies these gains and losses into earnings in the same period in which the underlying hedged transactions affect earnings. Any hedge ineffectiveness (which represents the amount by which the changes in the fair value of the derivative exceed the variability in the cash flows of the forecasted transaction) is recorded in current period earnings. For the six months ended June 30, 2014 and 2013, the Company did not record any gains or losses due to hedge ineffectiveness. The gains and losses on derivative financial instruments for which the Company does not elect hedge accounting treatment are recognized in the consolidated condensed statements of operations in each period based upon the change in the fair value of the derivative financial instrument. Cash flows from derivative financial instruments are reported as operating activities in the consolidated condensed statements of cash flows.

        Derivative financial instruments involve credit risk in the event the counterparty should default. It is the Company's policy to execute such instruments with global financial institutions that the Company believes to be creditworthy. The Company diversifies its derivative financial instruments among counterparties to minimize exposure to any one of these entities. The Company also uses International Swap Dealers Association master-netting agreements. The master-netting agreements provide for the net settlement of all contracts through a single payment in a single currency in the event of default, as defined by the agreements.

        The following table presents the location and fair value amounts of derivative instruments reported in the consolidated condensed balance sheets (in millions):

		Fair Value
Derivatives designated as hedging instruments	Balance Sheet Location	June 30, 2014		December 31, 2013
Assets
Foreign currency contracts	Other current assets	$	3.2	$	13.8
Interest rate swap agreements	Other assets	$	0.7	$	—
Liabilities
Foreign currency contracts	Accrued and other liabilities	$	7.1	$	13.2
Interest rate swap agreements	Other long-term liabilities	$	—	$	4.0

        The following table presents the effect of master-netting agreements and rights of offset on the consolidated condensed balance sheets (in millions):

							Gross Amounts Not Offset in the Consolidated Balance Sheet
			Gross Amounts Offset in the Consolidated Balance Sheet
					Net Amounts Presented in the Consolidated Balance Sheet
June 30, 2014	Gross Amounts						Financial Instruments			Cash Collateral Received		Net Amount
Derivative Assets
Foreign currency contracts	$	3.2	$	—	$	3.2	$	(3.2	)	$	—	$	—
Interest rate swap agreements	$	0.7	$	—	$	0.7	$	—		$	—	$	0.7
Derivative Liabilities
Foreign currency contracts	$	7.1	$	—	$	7.1	$	(3.2	)	$	—	$	3.9
December 31, 2013
Derivative Assets
Foreign currency contracts	$	13.8	$	—	$	13.8	$	(9.5	)	$	—	$	4.3
Derivative Liabilities
Foreign currency contracts	$	13.2	$	—	$	13.2	$	(9.5	)	$	—	$	3.7
Interest rate swap agreements	$	4.0	$	—	$	4.0	$	—		$	—	$	4.0

        The following tables present the effect of derivative instruments on the consolidated condensed statements of operations and consolidated condensed statements of comprehensive income (in millions):

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income
	Three Months Ended June 30,						Three Months Ended June 30,
						Location of Gain or (Loss) Reclassified from Accumulated OCI into Income
Derivatives in cash flow hedging relationships	2014			2013			2014		2013
Foreign currency contracts	$	(2.7	)	$	6.0	Cost of sales	$	3.0	$	5.8

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income
	Six Months Ended June 30,						Six Months Ended June 30,
						Location of Gain or (Loss) Reclassified from Accumulated OCI into Income
Derivatives in cash flow hedging relationships	2014			2013			2014		2013
Foreign currency contracts	$	(4.4	)	$	27.7	Cost of sales	$	8.0	$	11.0

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Three Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives in fair value hedging relationships		2014		2013
Interest rate swap agreements	Interest expense, net	$	2.6	$	—

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Six Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives in fair value hedging relationships		2014		2013
Interest rate swap agreements	Interest expense, net	$	4.7	$	—

        The gains on the interest rate swap agreements are fully offset by the changes in the fair value of the fixed-rate debt being hedged.

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Three Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives not designated as hedging instruments		2014			2013
Foreign currency contracts	Other expense, net	$	(2.5	)	$	5.1

		Amount of Gain or (Loss) Recognized in Income on Derivative
		Six Months Ended June 30,
	Location of Gain or (Loss) Recognized in Income on Derivative
Derivatives not designated as hedging instruments		2014			2013
Foreign currency contracts	Other expense, net	$	(3.2	)	$	14.4

        The Company expects that during the next twelve months it will reclassify to earnings a $2.8 million loss currently recorded in "Accumulated Other Comprehensive Loss."

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SEGMENT INFORMATION (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Information about reportable segments and reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income
Net sales	$ 575.1	$ 517.2	$ 1,097.5	$ 1,013.9
Pre-tax income	813.2	120.5	890.5	311.1
Unallocated amounts:
Special charges (Note 4)	(50.0)		(57.5)
Intellectual property litigation income (expense), net (Note 3)	747.4	(5.5)	741.9	72.6
Interest expense, net	(3.1)	(0.4)	(6.6)	(0.2)
Total segment
Information about reportable segments and reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income
Net sales	573.6	537.3	1,095.5	1,042.5
Pre-tax income	274.5	270.8	517.0	522.1
Total segment | United States
Information about reportable segments and reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income
Net sales	242.0	240.5	464.4	468.4
Pre-tax income	131.2	142.7	249.6	275.5
Total segment | Europe
Information about reportable segments and reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income
Net sales	188.3	160.7	363.9	316.2
Pre-tax income	87.7	73.7	167.9	146.2
Total segment | Japan
Information about reportable segments and reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income
Net sales	68.2	73.0	128.4	140.3
Pre-tax income	31.9	36.9	59.5	70.4
Total segment | Rest of World
Information about reportable segments and reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income
Net sales	75.1	63.1	138.8	117.6
Pre-tax income	23.7	17.5	40.0	30.0
Reconciling items (Unallocated amounts), foreign currency
Information about reportable segments and reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income
Net sales	1.5	(20.1)	2.0	(28.6)
Pre-tax income	2.5	(1.1)	8.4	(0.4)
Corporate, non-segment
Unallocated amounts:
Corporate items	$ (158.1)	$ (143.3)	$ (312.7)	$ (283.0)

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INCOME TAXES (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended		12 Months Ended	1 Months Ended	6 Months Ended	1 Months Ended	3 Months Ended	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013	Feb. 28, 2013 CoreValve, Inc.	Jun. 30, 2013 CoreValve, Inc.	May 31, 2014 Medtronic litigation settlement	Jun. 30, 2014 Medtronic litigation settlement	Jun. 30, 2014 Medtronic litigation settlement
INCOME TAXES
Effective income tax rates (as a percent)	32.70%	22.60%	31.80%	23.80%
Re-measurement of uncertain tax positions	$ 6.2		$ 6.2
Favorable impact of the federal research credit on the effective income tax rate (as a percent)					1.30%
Tax benefit related to federal research credit				8.4
Liability for income taxes associated with uncertain tax positions	172.0		172.0		127.7
Offsetting tax benefits associated with correlative effects of potential transfer pricing adjustments, state income taxes and timing adjustments	30.3		30.3		30.9
Net liability for income taxes associated with uncertain tax positions	141.7		141.7		96.8
LEGAL PROCEEDINGS
Tax expense	266.2	27.2	283.2	73.9			31.3		262.1	262.1
Litigation settlement payment received from Medtronic						$ 83.6		$ 750.0

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ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables)

6 Months Ended

Jun. 30, 2014

ACCUMULATED OTHER COMPREHENSIVE LOSS

Summary of activity for each component of Accumulated Other Comprehensive Loss

	Foreign Currency Translation Adjustments			Unrealized Gain (Loss) on Cash Flow Hedges			Unrealized Gain on Available-for- sale Investments			Unrealized Pension Costs			Total Accumulated Other Comprehensive Loss
	(in millions)
December 31, 2013	$	(20.2	)	$	3.5		$	0.3		$	(11.2	)	$	(27.6	)
Other comprehensive loss before reclassifications		(6.2	)		(4.4	)		(0.3	)		—			(10.9	)
Amounts reclassified from accumulated other comprehensive loss		—			(8.0	)		0.3			—			(7.7	)
Deferred income tax benefit		—			5.0			0.1			—			5.1
June 30, 2014	$	(26.4	)	$	(3.9	)	$	0.4		$	(11.2	)	$	(41.1	)

Schedule of amounts reclassified from Accumulated Other Comprehensive Loss

The following table provides information about amounts reclassified from "Accumulated Other Comprehensive Loss" (in millions):

	Three Months Ended June 30, 2014						Six Months Ended June 30, 2014
													Affected Line on Consolidated Condensed Statements of Operations
Details about Accumulated Other Comprehensive Loss Components	2014			2013			2014			2013
Gain on cash flow hedges	$	3.0		$	5.8		$	8.0		$	11.0		Cost of sales
		(1.1	)		(2.3	)		(3.0	)		(4.2	)	Provision for income taxes
	$	1.9		$	3.5		$	5.0		$	6.8		Net of tax
Loss on available-for-sale investments	$	(0.3	)	$	—		$	(0.3	)	$	—		Other expense, net
		—			—			—			—		Provision for income taxes
	$	(0.3	)	$	—		$	(0.3	)	$	—		Net of tax

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FAIR VALUE MEASUREMENTS (Details 2) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Assets
Available-for-sale investments	$ 0.5	$ 0.8
Fair Value on a Recurring Basis | Level 1
Assets
Investments held for deferred compensation plans	26.5	15.1
Available-for-sale investments	0.5	0.8
Total assets	27.0	15.9
Liabilities
Deferred compensation plans	26.5	15.5
Total liabilities	26.5	15.5
Fair Value on a Recurring Basis | Level 2
Assets
Derivatives	3.9	13.8
Total assets	3.9	13.8
Liabilities
Derivatives	7.1	17.2
Total liabilities	7.1	17.2
Fair Value on a Recurring Basis | Fair value
Assets
Investments held for deferred compensation plans	26.5	15.1
Available-for-sale investments	0.5	0.8
Derivatives	3.9	13.8
Total assets	30.9	29.7
Liabilities
Derivatives	7.1	17.2
Deferred compensation plans	26.5	15.5
Total liabilities	$ 33.6	$ 32.7

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EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2014

EARNINGS PER SHARE

EARNINGS PER SHARE

15.   EARNINGS PER SHARE

        Basic earnings per share is computed by dividing net income by the weighted-average common shares outstanding during a period. Employee equity share options, nonvested shares and similar equity instruments granted by the Company are treated as potential common shares in computing diluted earnings per share. Diluted shares outstanding include the dilutive effect of restricted stock units, market-based restricted stock units, and in-the-money options. The dilutive impact of the restricted stock units, market-based restricted stock units, and in-the-money options is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount that the employee must pay for exercising stock options, the amount of compensation expense for future service that the Company has not yet recognized, and the amount of tax benefits that would be recorded in "Additional Paid-in Capital" when the award becomes deductible are assumed to be used to repurchase shares. Potential common share equivalents have been excluded where their inclusion would be anti-dilutive.

        The table below presents the computation of basic and diluted earnings per share (in millions, except for per share information):

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Basic:
Net income	$	547.0	$	93.3	$	607.3	$	237.2
Weighted-average shares outstanding		105.6		112.6		106.1		113.3
Basic earnings per share	$	5.18	$	0.83	$	5.72	$	2.09
Diluted:
Net income	$	547.0	$	93.3	$	607.3	$	237.2
Weighted-average shares outstanding		105.6		112.6		106.1		113.3
Dilutive effect of stock plans		1.8		2.1		1.8		2.3
Dilutive weighted-average shares outstanding		107.4		114.7		107.9		115.6
Diluted earnings per share	$	5.09	$	0.81	$	5.63	$	2.05

        Stock options, restricted stock units, and market-based restricted stock units to purchase 4.4 million and 3.7 million shares for the three months ended June 30, 2014 and 2013, respectively, and 4.0 million and 3.0 million for the six months ended June 30, 2014 and 2013, respectively, were outstanding, but were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive.

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INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET (Tables)

6 Months Ended

Jun. 30, 2014

INTELLECTUAL PROPERTY LITIGATION (INCOME) EXPENSE, NET

Schedule of allocation of consideration to identifiable elements of settlement agreement

Past damages	$	754.3
License agreement		238.0
Covenant not to sue		77.7
Total	$	1,070.0

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DEBT (Details) (USD $)			1 Months Ended
	Oct. 31, 2013 Senior Notes due 2018	Jun. 30, 2014 Senior Notes due 2018 Carrying value	Jun. 30, 2014 Credit Facility Credit agreement, maturity July 2015	Jul. 31, 2014 Credit Facility Credit agreement, maturity July 2019	Jul. 31, 2014 Credit Facility Credit agreement, maturity July 2019 Minimum	Jul. 31, 2014 Credit Facility Credit agreement, maturity July 2019 Maximum	Jul. 31, 2014 Credit Facility Credit agreement, maturity July 2019 LIBOR	Jul. 31, 2014 Credit Facility Credit agreement, maturity July 2019 LIBOR Minimum	Jul. 31, 2014 Credit Facility Credit agreement, maturity July 2019 LIBOR Maximum
Debt and credit facility
Principal amount	$ 600,000,000
Interest rate (as a percent)	2.875%
Effective interest rate (as a percent)	2.983%
Issuance costs	5,400,000
Issuance discount	3,000,000
Value of the Notes		598,000,000
Term			4 years	5 years
Maximum aggregate borrowings under the facility			750,000,000	750,000,000
Borrowings outstanding under the facility			0
Optional increase in amount available, subject to lender approval						$ 250,000,000
Reference interest rate of the credit agreement							LIBOR
Percent spread added to reference rate of unsecured credit facility								1.00%	1.50%
Facility fee (as a percent)					0.125%	0.25%

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SPECIAL CHARGES (Details) (Edwards Lifesciences Foundation, Charitable foundation contribution, USD $) In Millions, unless otherwise specified	1 Months Ended
	Jun. 30, 2014
Edwards Lifesciences Foundation | Charitable foundation contribution
Related party transaction
Related party expense	$ 50.0

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CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 547.0	$ 93.3	$ 607.3	$ 237.2
Other comprehensive (loss) income, net of tax (Note 14)
Foreign currency translation adjustments	(5.4)	4.6	(6.2)	(19.6)
Unrealized (loss) gain on cash flow hedges	(3.4)	(0.2)	(7.4)	9.9
Unrealized loss on available-for-sale investments	(0.2)	(0.4)	(0.2)	(0.4)
Reclassification of net realized investment loss to earnings	0.3		0.3
Other comprehensive (loss) income	(8.7)	4.0	(13.5)	(10.1)
Comprehensive income	$ 538.3	$ 97.3	$ 593.8	$ 227.1

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SPECIAL CHARGES

6 Months Ended

Jun. 30, 2014

SPECIAL CHARGES

SPECIAL CHARGES

4.     SPECIAL CHARGES

• Charitable Foundation Contribution

        In June 2014, the Company contributed $50.0 million to the Edwards Lifesciences Foundation, a related-party not-for-profit organization intended to provide philanthropic support to health- and community-focused charitable organizations. The contribution was irrevocable and was recorded as an expense at the time of payment.

• Settlement

        In March 2014, the Company recorded a $7.5 million charge to settle past and future obligations related to one of its intellectual property agreements.

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STOCK-BASED COMPENSATION (Details 2) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Option Awards
Weighted-average assumptions for MRSUs, options and ESPP subscriptions granted
Options granted (in shares)			1,300,000
Weighted-average exercise price of options granted (in dollars per share)			$ 82.23
Average risk-free interest rate (as a percent)	1.40%	0.80%	1.40%	0.80%
Expected dividend yield (as a percent)	0.00%	0.00%	0.00%	0.00%
Expected volatility (as a percent)	30.70%	30.70%	30.70%	30.70%
Expected term	4 years 6 months	4 years 7 months 6 days	4 years 7 months 6 days	4 years 7 months 6 days
Fair value, per share	$ 23.58	$ 19.40	$ 23.21	$ 19.47
ESPP
Weighted-average assumptions for MRSUs, options and ESPP subscriptions granted
Average risk-free interest rate (as a percent)	0.10%	0.10%	0.10%	0.10%
Expected dividend yield (as a percent)	0.00%	0.00%	0.00%	0.00%
Expected volatility (as a percent)	29.20%	33.30%	31.30%	35.40%
Expected term	8 months 12 days	8 months 12 days	8 months 12 days	8 months 12 days
Fair value, per share	$ 18.33	$ 21.48	$ 16.96	$ 22.94
Restricted stock units
Weighted-average assumptions for MRSUs, options and ESPP subscriptions granted
Awards granted (in shares)			200,000
Weighted-average grant-date fair value of shares granted (in dollar per share)			$ 78.88
Market-based restricted stock units
Weighted-average assumptions for MRSUs, options and ESPP subscriptions granted
Awards granted (in shares)			39,000
Weighted-average grant-date fair value of shares granted (in dollar per share)			$ 108.75
Average risk-free interest rate (as a percent)			0.90%	0.40%
Expected volatility (as a percent)			31.70%	33.40%
Market-based restricted stock units | Total shareholder return relative to selected industry peer group
Weighted-average assumptions for MRSUs, options and ESPP subscriptions granted
Vesting period			3 years
Market-based restricted stock units | Total shareholder return relative to selected industry peer group | Minimum
Weighted-average assumptions for MRSUs, options and ESPP subscriptions granted
Percentage of targeted number of shares granted			0.00%
Market-based restricted stock units | Total shareholder return relative to selected industry peer group | Maximum
Weighted-average assumptions for MRSUs, options and ESPP subscriptions granted
Percentage of targeted number of shares granted			175.00%

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INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2014

INVENTORIES

Schedule of inventories

 Inventories consisted of the following (in millions):

	June 30, 2014		December 31, 2013
Raw materials	$	60.4	$	57.8
Work in process		79.1		82.2
Finished products		177.6		168.9
	$	317.1	$	308.9

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CHANGE IN ACCOUNTING PRINCIPLE (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended					3 Months Ended	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013	Dec. 31, 2013 Patents As Reported	Jan. 02, 2013 Change in method of accounting for certain intellectual property litigation expenses related to defense and enforcement of issued patents	Jun. 30, 2013 Change in method of accounting for certain intellectual property litigation expenses related to defense and enforcement of issued patents As Reported	Jun. 30, 2013 Change in method of accounting for certain intellectual property litigation expenses related to defense and enforcement of issued patents As Reported	Dec. 31, 2013 Change in method of accounting for certain intellectual property litigation expenses related to defense and enforcement of issued patents As Reported
Change in accounting principle
Unamortized capitalized legal costs						$ 23.7
Cumulative effect of change in accounting principle on retained earnings							12.2
Consolidated Condensed Balance Sheet
Other intangible assets, net	29.5		29.5		33.5					57.2
Deferred income taxes	69.9		69.9		79.0					70.1
Total assets	3,326.6		3,326.6		2,709.9					2,724.7
Retained earnings	2,638.1		2,638.1		2,030.8					2,045.6
Total stockholders' equity	1,914.9		1,914.9		1,544.4					1,559.2
Total liabilities and stockholders' equity	3,326.6		3,326.6		2,709.9					2,724.7
Consolidated Condensed Statement of Operations
Cost of sales	151.2	123.6	297.1	244.6				125.0	247.2
Gross profit	423.9	393.6	800.4	769.3				392.2	766.7
Selling, general and administrative expenses	215.5	186.6	412.7	369.0				189.4	374.6
Intellectual property litigation expense (income), net	(747.4)	5.5	(741.9)	(72.6)
Special gain	50.0		57.5						(83.6)
Income before provision for income taxes	813.2	120.5	890.5	311.1				121.8	313.9
Provision for income taxes	266.2	27.2	283.2	73.9				27.7	74.9
Net income	547.0	93.3	607.3	237.2				94.1	239.0
Earnings per share:
Basic (in dollars per share)	$ 5.18	$ 0.83	$ 5.72	$ 2.09				$ 0.84	$ 2.11
Diluted (in dollars per share)	$ 5.09	$ 0.81	$ 5.63	$ 2.05				$ 0.82	$ 2.07
Consolidated Condensed Statement of Comprehensive Income
Net income	547.0	93.3	607.3	237.2				94.1	239.0
Comprehensive income	538.3	97.3	593.8	227.1				98.1	228.9
Consolidated Condensed Statement of Cash Flows
Net income	547.0	93.3	607.3	237.2				94.1	239.0
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization			32.3	28.8					31.4
Other			(2.0)	0.8					1.1
Changes in operating assets and liabilities:
Prepaid expenses and other current assets			(10.8)	25.2					26.2
Other			$ 3.7	$ 0.3					$ (5.4)

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ACCUMULATED OTHER COMPREHENSIVE LOSS

6 Months Ended

Jun. 30, 2014

ACCUMULATED OTHER COMPREHENSIVE LOSS

ACCUMULATED OTHER COMPREHENSIVE LOSS

14.   ACCUMULATED OTHER COMPREHENSIVE LOSS

        Presented below is a summary of activity for each component of "Accumulated Other Comprehensive Loss" for the six months ended June 30, 2014.

	Foreign Currency Translation Adjustments			Unrealized Gain (Loss) on Cash Flow Hedges			Unrealized Gain on Available-for- sale Investments			Unrealized Pension Costs			Total Accumulated Other Comprehensive Loss
	(in millions)
December 31, 2013	$	(20.2	)	$	3.5		$	0.3		$	(11.2	)	$	(27.6	)
Other comprehensive loss before reclassifications		(6.2	)		(4.4	)		(0.3	)		—			(10.9	)
Amounts reclassified from accumulated other comprehensive loss		—			(8.0	)		0.3			—			(7.7	)
Deferred income tax benefit		—			5.0			0.1			—			5.1
June 30, 2014	$	(26.4	)	$	(3.9	)	$	0.4		$	(11.2	)	$	(41.1	)

        The following table provides information about amounts reclassified from "Accumulated Other Comprehensive Loss" (in millions):

	Three Months Ended June 30, 2014						Six Months Ended June 30, 2014
													Affected Line on Consolidated Condensed Statements of Operations
Details about Accumulated Other Comprehensive Loss Components	2014			2013			2014			2013
Gain on cash flow hedges	$	3.0		$	5.8		$	8.0		$	11.0		Cost of sales
		(1.1	)		(2.3	)		(3.0	)		(4.2	)	Provision for income taxes
	$	1.9		$	3.5		$	5.0		$	6.8		Net of tax
Loss on available-for-sale investments	$	(0.3	)	$	—		$	(0.3	)	$	—		Other expense, net
		—			—			—			—		Provision for income taxes
	$	(0.3	)	$	—		$	(0.3	)	$	—		Net of tax