10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2021

Commission File Number 001-16407

ZIMMER BIOMET HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware	13-4151777
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

345 East Main Street, Warsaw, IN  46580

(Address of principal executive offices)

Telephone:  (574) 267-6131

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	ZBH	New York Stock Exchange
1.414% Notes due 2022	ZBH 22A	New York Stock Exchange
2.425% Notes due 2026	ZBH 26	New York Stock Exchange
1.164% Notes due 2027	ZBH 27	New York Stock Exchange

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  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).     Yes  ☒    No  ☐

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

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.     ☐

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

As of July 28, 2021, 208,840,496 shares of the registrant’s $.01 par value common stock were outstanding.

ZIMMER BIOMET HOLDINGS, INC.

INDEX TO FORM 10-Q

June 30, 2021

		Page
Part I - Financial Information
Item 1.	Financial Statements (unaudited)	3
	Condensed Consolidated Statements of Earnings for the Three and Six Months Ended June 30, 2021 and 2020	3
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2021 and 2020	4
	Condensed Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020	5
	Condensed Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2021 and 2020	6
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020	7
	Notes to Interim Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.	Controls and Procedures	43
Part II - Other Information
Item 1.	Legal Proceedings	44
Item 1A.	Risk Factors	44
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44
Item 3.	Defaults Upon Senior Securities	44
Item 4.	Mine Safety Disclosures	44
Item 5.	Other Information	44
Item 6.	Exhibits	45
Signatures		46

2

Part I – Financial Information

Item 1.  Financial Statements

ZIMMER BIOMET HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(in millions, except per share amounts, unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Net Sales	$	2,026.9		$	1,226.1		$	3,874.3		$	3,009.9
Cost of products sold, excluding intangible asset amortization		581.6			424.5			1,098.0			911.6
Intangible asset amortization		154.6			147.7			310.1			295.3
Research and development		180.5			87.7			274.9			186.1
Selling, general and administrative		817.4			665.0			1,587.5			1,493.9
Goodwill and intangible asset impairment		16.3			33.0			16.3			645.0
Restructuring and other cost reduction initiatives		19.6			28.0			41.4			73.0
Quality remediation		11.0			9.7			21.2			26.1
Acquisition, integration, divestiture and related		25.4			2.2			38.8			6.6
Operating expenses		1,806.4			1,397.8			3,388.2			3,637.6
Operating Profit (Loss)		220.5			(171.7	)		486.1			(627.7	)
Other income, net		8.1			3.8			15.4			6.8
Interest expense, net		(54.7	)		(54.0	)		(107.0	)		(104.9	)
Earnings (loss) before income taxes		173.9			(221.9	)		394.5			(725.8	)
Provision (benefit) for income taxes		31.4			(13.7	)		54.3			(8.5	)
Net Earnings (Loss)		142.5			(208.2	)		340.2			(717.3	)
Less: Net earnings (loss) attributable to noncontrolling interest		0.6			(1.6	)		0.2			(2.2	)
Net Earnings (Loss) of Zimmer Biomet Holdings, Inc.	$	141.9		$	(206.6	)	$	340.0		$	(715.1	)
Earnings (Loss) Per Common Share
Basic	$	0.68		$	(1.00	)	$	1.63		$	(3.46	)
Diluted	$	0.67		$	(1.00	)	$	1.62		$	(3.46	)
Weighted Average Common Shares Outstanding
Basic		208.6			206.8			208.3			206.6
Diluted		210.7			206.8			210.4			206.6

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

3

ZIMMER BIOMET HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in millions, unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Net Earnings (Loss)	$	142.5		$	(208.2	)	$	340.2		$	(717.3	)
Other Comprehensive (Loss) Income:
Foreign currency cumulative translation adjustments, net of tax		(13.6	)		23.0			(32.7	)		(31.2	)
Unrealized cash flow hedge gains (losses), net of tax		2.2			(22.7	)		42.1			32.1
Reclassification adjustments on hedges, net of tax		2.3			(13.1	)		1.8			(26.6	)
Adjustments to prior service cost and unrecognized actuarial assumptions, net of tax		(1.2	)		2.1			(0.4	)		1.8
Total Other Comprehensive Income (Loss)		(10.3	)		(10.7	)		10.8			(23.9	)
Comprehensive Income (Loss)		132.2			(218.9	)		351.0			(741.2	)
Comprehensive income (loss) attributable to the noncontrolling interest		0.6			(1.6	)		0.2			(2.2	)
Comprehensive Income (Loss) Attributable to
Zimmer Biomet Holdings, Inc.	$	131.6		$	(217.3	)	$	350.8		$	(739.0	)

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

4

ZIMMER BIOMET HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share amounts, unaudited)

	June 30,			December 31,
	2021			2020
ASSETS
Current Assets:
Cash and cash equivalents	$	1,042.4		$	802.1
Accounts receivable, less allowance for credit losses		1,420.4			1,452.7
Inventories		2,533.0			2,450.7
Prepaid expenses and other current assets		361.0			377.8
Total Current Assets		5,356.8			5,083.3
Property, plant and equipment, net		2,005.2			2,047.7
Goodwill		9,247.6			9,261.8
Intangible assets, net		6,642.7			7,055.5
Other assets		970.9			969.4
Total Assets	$	24,223.2		$	24,417.7
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	360.6		$	330.0
Income taxes payable		41.8			59.5
Other current liabilities		1,476.1			1,667.4
Current portion of long-term debt		1,050.0			500.0
Total Current Liabilities		2,928.5			2,556.9
Deferred income taxes, net		722.8			790.4
Long-term income tax payable		581.6			588.1
Other long-term liabilities		604.5			656.4
Long-term debt		6,802.5			7,626.5
Total Liabilities		11,639.9			12,218.3
Commitments and Contingencies (Note 17)
Stockholders' Equity:
Zimmer Biomet Holdings, Inc. Stockholders' Equity:
Common stock, $0.01 par value, one billion shares authorized, 312.5 million shares in 2021 (311.4 million in 2020) issued		3.1			3.1
Paid-in capital		9,248.6			9,121.6
Retained earnings		10,331.0			10,086.9
Accumulated other comprehensive loss		(287.0	)		(297.8	)
Treasury stock, 103.8 million shares in 2021 (103.8 million shares in 2020)		(6,717.8	)		(6,719.6	)
Total Zimmer Biomet Holdings, Inc. stockholders' equity		12,577.9			12,194.2
Noncontrolling interest		5.4			5.2
Total Stockholders' Equity		12,583.3			12,199.4
Total Liabilities and Stockholders' Equity	$	24,223.2		$	24,417.7

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

5

ZIMMER BIOMET HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in millions, except per share amounts, unaudited)

	Zimmer Biomet Holdings, Inc. Stockholders
										Accumulated
										Other												Total
	Common Shares				Paid-in		Retained			Comprehensive			Treasury Shares						Noncontrolling			Stockholders'
	Number		Amount		Capital		Earnings			Loss			Number			Amount			Interest			Equity
Balance April 1, 2021		312.2	$	3.1	$	9,199.2	$	10,237.7		$	(276.7	)		(103.8	)	$	(6,718.3	)	$	4.8		$	12,449.8
Net earnings		-		-		-		141.9			-			-			-			0.6			142.5
Other comprehensive loss		-		-		-		-			(10.3	)		-			-			-			(10.3	)
Cash dividends declared ($0.24 per share)		-		-		-		(50.0	)		-			-			-			-			(50.0	)
Stock compensation plans		0.3		-		49.4		1.4			-			-			0.5			-			51.3
Balance June 30, 2021		312.5	$	3.1	$	9,248.6	$	10,331.0		$	(287.0	)		(103.8	)	$	(6,717.8	)	$	5.4		$	12,583.3
Balance April 1, 2020		310.6	$	3.1	$	8,984.3	$	9,866.2		$	(255.1	)		(103.8	)	$	(6,719.9	)	$	4.1		$	11,882.7
Net loss		-		-		-		(206.6	)		-			-			-			(1.6	)		(208.2	)
Other comprehensive loss		-		-		-		-			(10.7	)		-			-			-			(10.7	)
Cash dividends declared ($0.24 per share)		-		-		-		(49.7	)		-			-			-			-			(49.7	)
Stock compensation plans		0.1		-		29.7		0.1			-			-			-			-			29.8
Balance June 30, 2020		310.7	$	3.1	$	9,014.0	$	9,610.0		$	(265.8	)		(103.8	)	$	(6,719.9	)	$	2.5		$	11,643.9
Balance January 1, 2021		311.4	$	3.1	$	9,121.6	$	10,086.9		$	(297.8	)		(103.8	)	$	(6,719.6	)	$	5.2		$	12,199.4
Net earnings		-		-		-		340.0			-			-			-			0.2			340.2
Other comprehensive income		-		-		-		-			10.8			-			-			-			10.8
Cash dividends declared ($0.48 per share)		-		-		-		(100.0	)		-			-			-			-			(100.0	)
Stock compensation plans		1.1		-		127.0		4.1			-			-			1.8			-			132.9
Balance June 30, 2021		312.5	$	3.1	$	9,248.6	$	10,331.0		$	(287.0	)		(103.8	)	$	(6,717.8	)	$	5.4		$	12,583.3
Balance January 1, 2020		309.9	$	3.1	$	8,920.1	$	10,427.3		$	(241.9	)		(103.9	)	$	(6,720.5	)	$	4.7		$	12,392.8
Net loss		-		-		-		(715.1	)		-			-			-			(2.2	)		(717.3	)
Other comprehensive loss		-		-		-		-			(23.9	)		-			-			-			(23.9	)
Cash dividends declared ($0.48 per share)		-		-		-		(99.3	)		-			-			-			-			(99.3	)
Adoption of new accounting standard		-		-		-		(3.1	)		-			-			-			-			(3.1	)
Stock compensation plans		0.8		-		93.9		0.2			-			0.1			0.6			-			94.7
Balance June 30, 2020		310.7	$	3.1	$	9,014.0	$	9,610.0		$	(265.8	)		(103.8	)	$	(6,719.9	)	$	2.5		$	11,643.9

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

6

ZIMMER BIOMET HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions, unaudited)

	For the Six Months Ended June 30,
	2021			2020
Cash flows provided by (used in) operating activities:
Net earnings (loss)	$	340.2		$	(717.3	)
Adjustments to reconcile net earnings (loss) to cash provided    by operating activities:
Depreciation and amortization		535.2			508.7
Share-based compensation		46.4			38.3
Goodwill and intangible asset impairment		16.3			645.0
Changes in operating assets and liabilities, net of acquired assets and liabilities
Income taxes		(37.3	)		(46.1	)
Receivables		5.3			272.7
Inventories		(94.4	)		(122.6	)
Accounts payable and accrued liabilities		(56.3	)		(233.9	)
Other assets and liabilities		(55.0	)		53.3
Net cash provided by operating activities		700.4			398.1
Cash flows provided by (used in) investing activities:
Additions to instruments		(150.5	)		(159.3	)
Additions to other property, plant and equipment		(54.7	)		(59.2	)
Net investment hedge settlements		(9.6	)		26.8
Other investing activities		(17.4	)		(14.8	)
Net cash used in investing activities		(232.2	)		(206.5	)
Cash flows provided by (used in) financing activities:
Proceeds from senior notes		-			1,497.1
Redemption of senior notes		(200.0	)		(1,500.0	)
Dividends paid to stockholders		(99.8	)		(99.1	)
Proceeds from employee stock compensation plans		91.5			61.7
Net cash flows from unremitted collections from factoring programs		-			(19.6	)
Business combination contingent consideration payments		(6.5	)		(7.5	)
Debt issuance costs		-			(19.4	)
Other financing activities		(9.3	)		(6.1	)
Net cash used in financing activities		(224.1	)		(92.9	)
Effect of exchange rates on cash and cash equivalents		(3.8	)		(3.2	)
Increase in cash and cash equivalents		240.3			95.5
Cash and cash equivalents, beginning of year		802.1			617.9
Cash and cash equivalents, end of period	$	1,042.4		$	713.4

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

7

ZIMMER BIOMET HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.  Basis of Presentation

The financial data presented herein is unaudited and should be read in conjunction with the consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2020.

In our opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the financial position, results of operations and cash flows for the interim periods presented.  The December 31, 2020 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”).  Results for interim periods should not be considered indicative of results for the full year.

Risks and Uncertainties - Our results have been and are expected to continue to be impacted by the COVID-19 global pandemic. The vast majority of our net sales are derived from products used in elective surgical procedures which are being deferred due to precautions in certain markets.  The consequences of COVID-19 continue to be extremely fluid and there are many market dynamics that are difficult to predict.  The COVID-19 pandemic may have a significant unfavorable effect on our financial position, results of operations and cash flows in the near term.  

Planned Spinoff - On February 5, 2021, we announced our intention to pursue a plan to spin off our Spine and Dental businesses into a new public company (“SpinCo”).  The planned transaction is intended to benefit our stockholders by enhancing the focus of both Zimmer Biomet and SpinCo to meet the needs of patients and customers and, therefore, achieve faster growth and deliver greater value for all stakeholders.  The transaction is intended to qualify as a tax-free distribution, for U.S. federal income tax purposes, to U.S. stockholders of new publicly traded stock in SpinCo.  We are targeting completion of the spinoff by mid-2022, subject to the satisfaction of certain conditions, including, among others, final approval of our Board of Directors, receipt of a favorable opinion and Internal Revenue Service (“IRS”) ruling with respect to the tax-free nature of the transaction, obtaining debt financing for the new company, and the effectiveness of a Form 10 registration statement with the U.S. Securities and Exchange Commission (the “SEC”).  Therefore, we cannot provide assurance that we will be able to complete the spinoff on the terms or on the timeline that we announced, or at all.

The words “we,” “us,” “our” and similar words and “Zimmer Biomet” refer to Zimmer Biomet Holdings, Inc. and its subsidiaries.  “Zimmer Biomet Holdings” refers to the parent company only.

2.  Significant Accounting Policies  

Use of Estimates - The accompanying unaudited condensed consolidated financial statements are prepared in conformity with GAAP, which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  We have made our best estimates, as appropriate under GAAP, in the recognition of our assets and liabilities.  These estimates have considered the impact the COVID-19 pandemic may have on our financial position, results of operations and cash flows.  Such estimates included, but were not limited to, variable consideration to our customers, our allowance for doubtful accounts for expected credit losses, the net realizable value of our inventory, the fair value of our goodwill and the recoverability of other long-lived assets.  Actual results could differ materially from these estimates.

Accounting Pronouncements Recently Adopted

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-12 Simplifying the Accounting for Income Taxes.  ASU 2019-12 eliminates certain exceptions in the rules regarding the approach for intraperiod tax allocations and the methodology for calculating income taxes in an interim period, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill, among other things. We adopted this standard as of January 1, 2021. The adoption of this standard did not have a material impact on our financial position, results of operations or cash flows.

Accounting Pronouncements Not Yet Adopted

8

In March 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848).  ASU 2020-04 provides temporary optional guidance to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying generally accepted accounting principles to transactions affected by reference rate reform if certain criteria are met. Early adoption of this ASU is permitted, and we may elect to apply the amendments prospectively through December 31, 2022. We are currently evaluating the impact this ASU will have on our financial statements.

There are no recently issued accounting pronouncements that we have not yet adopted that are expected to have a material effect on our financial position, results of operations or cash flows.

3.  Revenue

Net sales by geography are as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Americas	$	1,239.6	$	733.7	$	2,354.6	$	1,835.0
EMEA		429.8		218.7		814.0		616.8
Asia Pacific		357.5		273.7		705.7		558.1
Total	$	2,026.9	$	1,226.1	$	3,874.3	$	3,009.9

Net sales by product category are as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Knees	$	665.6	$	375.0	$	1,279.9	$	1,003.7
Hips		474.6		329.7		921.6		762.3
S.E.T.		462.1		292.7		879.7		673.6
Dental & Spine		263.5		152.3		509.5		371.8
Other		161.1		76.4		283.6		198.5
Total	$	2,026.9	$	1,226.1	$	3,874.3	$	3,009.9

In the first quarter of 2021, we updated our product category revenue reporting.  Product category sales include the following changes:

• Orthopedic robotic capital sales and services, previously reported in the Knee product category, are included in the Other product category;

• Disposable products used in computer-assisted surgeries, previously reported in the Other product category, are included in the Knees product category;

• CMFT (Craniomaxillofacial and Thoracic) products, previously reported in the Dental, Spine & CMFT category, are included in the S.E.T. (Sports Medicine, Extremities and Trauma) product category;

• CMFT has been removed from the Dental, Spine & CMFT product category and the name has been changed to Dental & Spine to reflect the revenue related to the spin off of SpinCo;

• Office based technologies products, previously reported in the Other product category, are included in the Dental & Spine product category;

• Other immaterial adjustments across product categories related to brand alignment.

Prior period product category sales have been reclassified to conform to the current presentation.

9

4.  Restructuring

In December 2019, our Board of Directors approved, and we initiated, a new global restructuring program (the “2019 Restructuring Plan”) with an objective of reducing costs to allow us to further invest in higher priority growth opportunities.  The 2019 Restructuring Plan is expected to result in total pre-tax restructuring charges of approximately $350 million to $400 million and reduce gross annual pre-tax operating expenses by approximately $200 million to $300 million by the end of 2023 as program benefits are realized.  The pre-tax restructuring charges consist of employee termination benefits; contract terminations for facilities and sales agents; and other charges, such as consulting fees, project management and relocation costs.  The restructuring charges incurred in the three and six-month periods ended June 30, 2021 primarily related to employee termination benefits, distributor contract terminations, consulting and project management.  The following table summarizes the liabilities recognized related to the 2019 Restructuring Plan (in millions):

	Employee
	Termination			Contract
	Benefits			Terminations			Other			Total
Expenses incurred in the three months ended June 30, 2021	$	1.8		$	1.5		$	12.0		$	15.3
Balance, December 31, 2020	$	38.7		$	10.9		$	15.1		$	64.7
Expenses incurred in the six months ended June 30, 2021		3.4			6.8			24.1			34.3
Cash payments		(8.5	)		(3.6	)		(17.7	)		(29.8	)
Foreign currency exchange rate changes		(0.7	)		-			-			(0.7	)
Balance, June 30, 2021	$	32.9		$	14.1		$	21.5		$	68.5
Expense incurred since the start of the 2019 Restructuring Plan	$	81.9		$	22.6		$	74.3		$	178.8
Expense estimated to be recognized for the 2019 Restructuring Plan	$	180.0		$	25.0		$	170.0		$	375.0

For the expense estimated to be recognized for the 2019 Restructuring Plan, we have disclosed the midpoint in our estimated range of expenses.  We do not include restructuring charges in the operating profit of our reportable segments.    

In our condensed consolidated statement of earnings, we report restructuring charges in our “Restructuring and other cost reduction initiatives” financial statement line item.  We report the expenses for other cost reduction initiatives with restructuring expenses because these activities also have the goal of reducing costs across the organization.  However, since the cost reduction initiative expenses are not considered restructuring, they have been excluded from the amounts presented in this note.

5.  Inventories

	June 30,		December 31,
	2021		2020
	(in millions)
Finished goods	$	2,024.0	$	1,954.6
Work in progress		229.5		223.7
Raw materials		279.5		272.4
Inventories	$	2,533.0	$	2,450.7

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6.  Property, Plant and Equipment

	June 30,			December 31,
	2021			2020
	(in millions)
Land	$	27.5		$	27.7
Buildings and equipment		2,266.4			2,197.8
Capitalized software costs		450.9			455.8
Instruments		3,668.3			3,518.3
Construction in progress		110.0			125.3
		6,523.1			6,324.9
Accumulated depreciation		(4,517.9	)		(4,277.2	)
Property, plant and equipment, net	$	2,005.2		$	2,047.7

We had $19.5 million and $24.4 million of property, plant and equipment included in accounts payable as of June 30, 2021 and December 31, 2020, respectively.

7.Acquisitions

In the fourth quarter of 2020, we completed the acquisitions of A&E Medical Corporation (“A&E Medical”), a sternal closure company, and Relign Corp. (“Relign”), an arthroscopy equipment company (collectively referred to as the “2020 acquisitions”).  The 2020 acquisitions were completed primarily to expand our product offerings in the CMFT and sports medicine markets.  The total aggregate cash consideration paid in 2020 related to the 2020 acquisitions was $244.9 million, with an additional $145.0 million of guaranteed deferred payments to be made in the second half of 2021.  We have assigned a fair value of $31.3 million for potential additional payments as of the acquisition dates related to these acquisitions that are contingent on the respective acquired companies’ future product sales.  The estimated fair value of the aggregate contingent payment liabilities was calculated based on the probability of achieving the specified sales growth and discounting to present value the estimated payments.  

The goodwill related to the 2020 acquisitions represents the excess of the consideration transferred over the fair value of the net assets acquired.  The goodwill related to the 2020 acquisitions is generated from the operational synergies and cross-selling opportunities we expect to achieve from the technologies acquired.  None of the goodwill related to these acquisitions is expected to be deductible for tax purposes.

The purchase price allocations as of June 30, 2021 are preliminary.  We need additional time to finalize the acquired companies’ tax returns and evaluate their tax attributes, which may change the recognized tax assets and liabilities.  There may be differences between the preliminary estimates of fair value and the final acquisition accounting. The final estimates of fair value are expected to be completed as soon as possible, but no later than one year after the respective acquisition dates.

The following table summarizes the aggregate preliminary estimates of fair value of the assets acquired and liabilities assumed related to the 2020 acquisitions (in millions):

Current assets	$	33.6
Intangible assets subject to amortization:
Technology		147.9
Trademarks and trade names		1.5
Customer relationships		92.7
Other		4.9
Goodwill		189.9
Other assets		5.4
Total assets acquired		475.9
Current liabilities		4.5
Deferred income taxes		48.5
Other long-term liabilities		1.7
Total liabilities assumed		54.7
Net assets acquired	$	421.2

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In the six-month period ended June 30, 2021 we adjusted the preliminary fair values that were recognized as of December 31, 2020.  The adjustments primarily related to the customer relationships intangible asset and the related deferred income tax liability as we refined our estimates by analyzing historical purchasing patterns of existing customers.  The adjustment did not result in a significant change to intangible asset amortization expense recognized in the six-month period ended June 30, 2021 that would have been recognized in the previous period if the adjustment were recognized as of the acquisition date. There were no significant adjustments during the three-month period ended June 30, 2021.

The weighted average amortization period selected for technology, trademarks and trade names, customer relationships and other intangible assets were 13 years, 12 years, 15 years and 5 years, respectively.

We have not included pro forma information and certain other information under GAAP for the 2020 acquisitions because they did not have a material impact on our financial position or results of operations.

8.  Goodwill and Intangible Assets

The following table summarizes the changes in the carrying amount of goodwill by reportable segment, including the effects of changes to our reportable segments (in millions):

	Americas Orthopedics			EMEA			Asia Pacific			Americas Spine and Global Dental			Total
Balance at December 31, 2020
Goodwill	$	9,583.7		$	1,362.9		$	580.8		$	-		$	11,527.4
Accumulated impairment losses		(1,228.6	)		(1,037.0	)		-			-			(2,265.6	)
	$	8,355.1		$	325.9		$	580.8		$	-		$	9,261.8
Goodwill reportable segment change		(1,491.3	)		-			-			1,491.3			-
Accumulated impairment losses reportable segment change		1,220.9			-			-			(1,220.9	)		-
Purchase accounting adjustments		21.1			5.2			2.3			-			28.6
Other acquisitions		2.4			-			-			-			2.4
Currency translation		(29.3	)		(7.6	)		(9.0	)		0.7			(45.2	)
Balance at June 30, 2021
Goodwill	$	8,086.6		$	1,360.5		$	574.1		$	1,492.0		$	11,513.2
Accumulated impairment losses		(7.7	)		(1,037.0	)		-			(1,220.9	)		(2,265.6	)
	$	8,078.9		$	323.5		$	574.1		$	271.1		$	9,247.6

As discussed further in Note 16, our operating and reportable segments have changed.  Goodwill has been reallocated from our previous reportable segments to reflect the new structure.  However, our reporting units have not changed. The Americas Spine and Global Dental reporting units are now assigned to the new Americas Spine and Global Dental reportable segment.

As of March 31, 2020, we tested three of our reporting units for impairment due to: i) the significant adverse effect the COVID-19 pandemic was expected to have on our operating results, and ii) a change in reportable segments in the first quarter of 2020, which changed the cash flows and asset compositions of certain reporting units.  This resulted in goodwill impairment charges of $470.0 million and $142.0 million recognized for our Europe, Middle East and Africa (“EMEA”) reporting unit and Global Dental reporting unit, respectively.  The remaining two reporting units with goodwill assigned to them were not tested for impairment as we concluded it is more likely than not the fair value of these reporting units exceeds their carrying value. The goodwill balance related to the Americas Spine reporting unit was already fully impaired.

The impairment charge of $470.0 million in our EMEA reporting unit was due to the COVID-19 pandemic and reportable segment change.  The COVID-19 pandemic has had a significant adverse effect on both the operational and non-operational assumptions used to estimate the fair value of our EMEA reporting unit.  The significant decline in our share price and that of most other publicly-traded companies resulted in us utilizing a higher risk-adjusted discount rate compared to the rate used in our 2019 annual goodwill impairment test to discount our future estimated cash flows to present value.  On an operational basis, due to the deferral of elective surgical procedures, at the time of the March 31, 2020 impairment test, we estimated cash flows in 2020 to be significantly lower than previously estimated in the 2019 annual goodwill impairment test.  The change in reportable segments resulted in additional impairment due to additional assets being allocated to the EMEA reporting unit.  As of June 30, 2021, $323.5 million of goodwill remains in the EMEA reporting unit.  

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The impairment charge of $142.0 million in our Global Dental reporting unit was driven by the COVID-19 pandemic.  Similar to our EMEA reporting unit, changes in the market caused an increase to the risk-adjusted discount rates utilized to discount our future estimated cash flows to present value, and we expected that the deferral of elective dental procedures would have an adverse effect on our cash flows.  We estimated the cash flows from our Global Dental reporting unit may recover more slowly than our other reporting units because many dental procedures are not covered by insurance.  Therefore, we estimated economic uncertainty would likely result in patients deferring dental procedures for a longer period of time than procedures involving our other products.  As of June 30, 2021, $271.1 million of goodwill remains in the Global Dental reporting unit.  

The third reporting unit we tested for impairment, Americas CMFT, had an estimated fair value that exceeded its carrying value by less than 5 percent.  The Americas CMFT reporting unit’s estimated fair value was also adversely impacted by the COVID-19 pandemic similar to our EMEA and Global Dental reporting units.   

We estimated the fair value of the EMEA, Global Dental and Americas CMFT reporting units based on income and market approaches.  Fair value under the income approach was determined by discounting to present value the estimated future cash flows of the reporting unit.  Fair value under the market approach utilized the guideline public company methodology, which uses valuation indicators from publicly-traded companies that are similar to our EMEA, Global Dental and Americas CMFT reporting units and considers differences between our reporting unit and the comparable companies.

In estimating the future cash flows of the reporting units, we utilized a combination of market and company-specific inputs that a market participant would use in assessing the fair value of the reporting units.  The primary market input was revenue growth rates.  These rates were based upon historical trends and estimated future growth drivers such as an aging global population, obesity and more active lifestyles.  The impact of declining revenue from the COVID-19 pandemic was included in the future cash flows.  Significant company specific inputs included assumptions regarding how the reporting units could leverage operating expenses as revenue grows and the impact any of our differentiated products or new products will have on revenues.

Under the guideline public company methodology, we took into consideration specific risk differences between our reporting unit and the comparable companies, such as recent financial performance, size risks and product portfolios, among other considerations.

We perform our annual test of goodwill impairment in the fourth quarter of every year.  In connection with the 2020 annual goodwill impairment test in the fourth quarter of 2020, we performed a qualitative test on our Asia Pacific reporting unit and concluded it was more likely than not the fair value of this reporting unit exceeded its carrying value.  We estimated the fair value of our Americas Orthopedics, Americas CMFT, EMEA and Global Dental reporting units using the income and market approaches.  The estimated fair values of our reporting units increased in the fourth quarter impairment test compared to the March 31, 2020 test due to the negative effects on discounted cash flows from the COVID-19 pandemic forecasted for second and third quarters of 2020 no longer being in the future cash flow estimates.  As a result, the estimated fair value of each reporting unit exceeded its carrying value by more than 10 percent.

We will continue to monitor the fair value of our EMEA, Global Dental and Americas CMFT reporting units as well as our other two reporting units in our interim and annual reporting periods.  If our estimated cash flows for these reporting units decrease, we may have to record further impairment charges in the future.  Factors that could result in our cash flows being lower than our current estimates include: 1) the COVID-19 pandemic causes elective surgical procedures to be deferred longer than our estimates, or additional recurrence of the virus causes hospitals to defer elective surgical procedures, 2) decreased revenues caused by unforeseen changes in the healthcare market, or our inability to generate new product revenue from our research and development activities, and 3) our inability to achieve the estimated operating margins in our forecasts due to unforeseen factors.  Additionally, changes in the broader economic environment could cause changes to our estimated discount rates and comparable company valuation indicators, which may impact our estimated fair values.

In the three and six-month periods ended June 30, 2021 and 2020, we recognized $16.3 million and $33.0 million, respectively, of in-process research and development (“IPR&D”) intangible asset impairments on certain IPR&D projects.  The $16.3 million impairment charge in 2021 is related to a terminated project. The $33.0 million charge in 2020 includes a $19.0 million impairment related to a project that required additional research and development costs to complete, which delayed the cash inflows and resulted in a decreased estimated fair value.  The remaining $14.0 million impairment charge in 2020 is related to terminated projects.  The termination of these projects is the result of obstacles encountered to achieve regulatory approval or prioritizing our internal research and development portfolio to focus our engineering resources on the opportunities that most closely link to our mission.  Since these projects had a low probability of success or were not a priority, their terminations are not expected to have a significant impact on our future cash flows.

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9.  Transfers of Financial Assets

We have receivables purchase arrangements with unrelated third parties to liquidate portions of our trade accounts receivable balance.  The receivables relate to products sold to customers and are short-term in nature.  The factorings are treated as sales of our accounts receivable.  Proceeds from the transfers reflect either the face value of the accounts receivable or the face value less factoring fees.  

We terminated our programs in the U.S. and Japan in the fourth quarter of 2020.  We acted as the collection agent on behalf of the third party, but had no significant retained interests or servicing liabilities related to the accounts receivable sold.  As of December 31, 2020, we had collected and remitted or repurchased all factored receivables at the time of the termination of those programs in 2020.

In Europe, we sell to a third party and have no continuing involvement or significant risk with the factored accounts receivable.

Funds received from the transfers are recorded as an increase to cash and a reduction to accounts receivable outstanding in the condensed consolidated balance sheets.  We report the cash flows attributable to the sale of receivables to third parties in cash flows from operating activities in our condensed consolidated statements of cash flows.  Net expenses resulting from the sales of receivables are recognized in selling, general and administrative expense.  Net expenses include any resulting gains or losses from the sales of receivables, credit insurance and factoring fees.

In the six-month periods ended June 30, 2021 and 2020, we sold receivables having an aggregate face value of $70.2 million and $980.9 million to third parties in exchange for cash proceeds of $69.7 million and $979.9 million, respectively.  Expenses recognized on these sales during the six-month periods ended June 30, 2021 and 2020 were not significant.  In the six-month period ended June 30, 2020, under the U.S. and Japan programs, we collected $885.8 million from our customers and remitted that amount to the third party, and we effectively repurchased $84.1 million of previously sold accounts receivable from the third party, due to the programs’ revolving nature.  The initial collection of cash from customers and its remittance to the third party is reflected in net cash provided by/(used in) financing activities in our condensed consolidated statements of cash flows.  No amounts were unremitted to third parties as of June 30, 2021 and December 31, 2020.

10.  Debt

Our debt consisted of the following (in millions):

	June 30,			December 31,
	2021			2020
Current portion of long-term debt
3.375% Senior Notes due 2021	$	300.0		$	300.0
3.150% Senior Notes due 2022		750.0			-
Floating Rate Notes due 2021		-			200.0
Total current portion of long-term debt	$	1,050.0		$	500.0
Long-term debt
3.150% Senior Notes due 2022	$	-		$	750.0
3.700% Senior Notes due 2023		300.0			300.0
3.550% Senior Notes due 2025		2,000.0			2,000.0
3.050% Senior Notes due 2026		600.0			600.0
3.550% Senior Notes due 2030		900.0			900.0
4.250% Senior Notes due 2035		253.4			253.4
5.750% Senior Notes due 2039		317.8			317.8
4.450% Senior Notes due 2045		395.4			395.4
1.414% Euro Notes due 2022		593.0			611.8
2.425% Euro Notes due 2026		593.0			611.8
1.164% Euro Notes due 2027		593.0			611.8
Japan Term Loan A		105.3			113.3
Japan Term Loan B		191.8			206.3
Debt discount and issuance costs		(41.7	)		(48.2	)
Adjustment related to interest rate swaps		1.5			3.1
Total long-term debt	$	6,802.5		$	7,626.5

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At June 30, 2021, our total current and non-current debt of $7.9 billion consisted of $7.6 billion aggregate principal amount of our senior notes, which included $1.8 billion Euro-denominated senior notes (“Euro Notes”), an 11.7 billion Japanese Yen term loan agreement (“Japan Term Loan A”) and a 21.3 billion Japanese Yen term loan agreement (“Japan Term Loan B”) that will each mature on September 27, 2022, and other debt and fair value adjustments totaling $1.5 million, partially offset by debt discount and issuance costs of $41.7 million.

In the six-month period ended June 30, 2021, we repaid $200.0 million on our Floating Rate Notes due 2021.

On March 20, 2020, we completed the offering of $600.0 million aggregate principal amount of our 3.050% senior notes due on January 15, 2026 and $900.0 million aggregate principal amount of our 3.550% senior notes due on March 20, 2030.  Interest payable on the 3.050% senior notes is payable semi-annually, commencing on July 15, 2020 until maturity. Interest payable on the 3.550% senior notes is payable semi-annually, commencing on September 20, 2020 until maturity.  The proceeds from the offering, together with cash on hand, were used to repay at maturity the $1.5 billion principal amount of 2.700% senior notes due on April 1, 2020.

We have a revolving credit agreement (the “2019 Credit Agreement”), which contains a five-year unsecured multicurrency revolving facility of $1.5 billion (the “2019 Multicurrency Revolving Facility”).  The 2019 Credit Agreement will mature on November 1, 2024, with two one-year extensions exercisable at our discretion and subject to required lender consent.  The 2019 Credit Agreement also includes an uncommitted incremental feature allowing us to request an increase of the facility by an aggregate amount of up to $500.0 million.  As of June 30, 2021, there were no outstanding borrowings under the 2019 Multicurrency Revolving Facility.

Borrowings under the 2019 Credit Agreement generally bear interest at floating rates.  We pay a facility fee on the aggregate amount of the 2019 Multicurrency Revolving Facility.  The 2019 Credit Agreement contains customary affirmative and negative covenants and events of default for unsecured financing arrangements, including, among other things, limitations on consolidations, mergers, and sales of assets.   On April 23, 2020, we entered into an amendment to the 2019 Credit Agreement to temporarily increase the maximum permitted consolidated indebtedness to consolidated EBITDA ratio (“Consolidated Leverage Ratio”), temporarily increase the interest rate margin applicable to revolving loans and the facility fee, and make other administrative changes.  Pursuant to the amendment, the maximum permitted Consolidated Leverage Ratio as of the last day of any period of four consecutive fiscal quarters under the 2019 Credit Agreement is (i) 5.75 to 1.00 for periods ending between April 1, 2020 and including December 31, 2020, (ii) 5.00 to 1.00 for the period ending March 31, 2021, and (iii) 4.50 to 1.00 for periods ending after April 1, 2021 (with such maximum permitted Consolidated Leverage Ratio subject to increase to 5.00 to 1.00 for a period of time in connection with a qualified material acquisition on or after July 1, 2021).  We were in compliance with all covenants under the 2019 Credit Agreement as of June 30, 2021. The amendment also increased the interest rate margin applicable to revolving loans and the facility fee, each of which are determined by reference to our senior unsecured long-term debt credit rating, through June 30, 2021.  On February 26, 2021, we entered into a further amendment to the 2019 Credit Agreement to facilitate the addition of a new lender while maintaining the amount of the credit facility at $1.5 billion and incorporating certain administrative changes.   

On April 23, 2020, we entered into a revolving credit agreement which was an unsecured revolving credit facility of $1.0 billion (the “April 2020 Revolving Facility”).  In conjunction with a new revolving credit agreement (the “September 2020 Credit Agreement”) entered into on September 18, 2020, the April 2020 Revolving Facility was terminated.  We never borrowed against the April 2020 Revolving Facility.  The September 2020 Credit Agreement is a $1.0 billion 364-day unsecured revolving credit facility (the “September 2020 Revolving Facility”).  The September 2020 Revolving Facility will be used for general corporate purposes.  The September 2020 Credit Agreement matures on September 17, 2021. Borrowings under the September 2020 Credit Agreement generally bear interest at floating rates.  We pay a facility fee on the aggregate amount of the September 2020 Revolving Facility.  The September 2020 Credit Agreement contains customary affirmative and negative covenants and events of default for an unsecured financing arrangement including, among other things, limitations on consolidations, mergers, and sales of assets.  The September 2020 Credit Agreement requires us to maintain a Consolidated Leverage Ratio as of the last day of any period of four consecutive fiscal quarters of no greater than (i) 5.75 to 1.00 for periods ending during the period from September 18, 2020 to and including December 31, 2020, (ii) 5.00 to 1.00 for the period ending March 31, 2021, and (iii) 4.50 to 1.00 for periods ending after April 1, 2021 (with such permitted Consolidated Leverage Ratio subject to increase to 5.00 to 1.00 for a period of time in connection with a qualified material acquisition on or after July 1, 2021).  We were in compliance with all covenants under the September 2020 Credit Agreement, as of June 30, 2021.  As of June 30, 2021, there were no outstanding borrowings under the September 2020 Credit Agreement.

The estimated fair value of our senior notes as of June 30, 2021, based on quoted prices for the specific securities from transactions in over-the-counter markets (Level 2), was $8,238.2 million.  The estimated fair value of Japan Term Loan A and Japan Term Loan B, in the aggregate, as of June 30, 2021, based upon publicly available market yield curves and the terms of the debt (Level 2), was $296.5 million.

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11.  Accumulated Other Comprehensive Income

Accumulated other comprehensive income (loss) (“AOCI”) refers to certain gains and losses that under GAAP are included in comprehensive income but are excluded from net earnings as these amounts are initially recorded as an adjustment to stockholders’ equity.  Amounts in AOCI may be reclassified to net earnings upon the occurrence of certain events.  

Our AOCI is comprised of foreign currency translation adjustments, unrealized gains and losses on cash flow hedges and unrecognized prior service costs and gains and losses in actuarial assumptions related to our defined benefit plans.  Foreign currency translation adjustments are reclassified to net earnings upon sale or upon a complete or substantially complete liquidation of an investment in a foreign entity.  Unrealized gains and losses on cash flow hedges are reclassified to net earnings when the hedged item affects net earnings.  Amounts related to defined benefit plans that are in AOCI are reclassified over the service periods of employees in the plan.

The following table shows the changes in the components of AOCI gains (losses), net of tax (in millions):

	Foreign			Cash			Defined
	Currency			Flow			Benefit			Total
	Translation			Hedges			Plan Items			AOCI
Balance at December 31, 2020	$	(7.2	)	$	(55.6	)	$	(235.0	)	$	(297.8	)
AOCI before reclassifications		(32.7	)		42.1			-			9.4
Reclassifications to statements of earnings		-			1.8			(0.4	)		1.4
Balance at June 30, 2021	$	(39.9	)	$	(11.7	)	$	(235.4	)	$	(287.0	)

The following table shows the reclassification adjustments from AOCI (in millions):

	Amount of Gain (Loss)
	Reclassified from AOCI
	Three Months Ended						Six Months Ended
	June 30,						June 30,						Location on
Component of AOCI	2021			2020			2021			2020			Statements of Earnings
Cash flow hedges
Foreign exchange forward contracts	$	(2.6	)	$	15.1		$	(1.5	)	$	30.7		Cost of products sold
Forward starting interest rate swaps		(0.2	)		(0.1	)		(0.3	)		(0.3	)	Interest expense, net
		(2.8	)		15.0			(1.8	)		30.4		Total before tax
		(0.5	)		1.9			-			3.8		Provision (benefit) for income taxes
	$	(2.3	)	$	13.1		$	(1.8	)	$	26.6		Net of tax
Defined benefit plans
Prior service cost and unrecognized actuarial gain (loss)	$	1.8		$	(1.7	)	$	0.3		$	(3.4	)	Other income, net
		0.6			0.4			(0.1	)		(1.6	)	Provision (benefit) for income taxes
	$	1.2		$	(2.1	)	$	0.4		$	(1.8	)	Net of tax
Total reclassifications	$	(1.1	)	$	11.0		$	(1.4	)	$	24.8		Net of tax

The following table shows the tax effects on each component of AOCI recognized in our condensed consolidated statements of comprehensive income (loss) (in millions):

	Three Months Ended June 30, 2021									Six Months Ended June 30, 2021
	Before Tax			Tax			Net of Tax			Before Tax			Tax		Net of Tax
Foreign currency cumulative translation adjustments	$	(18.2	)	$	(4.6	)	$	(13.6	)	$	(17.6	)	$	15.1	$	(32.7	)
Unrealized cash flow hedge gains		0.4			(1.8	)		2.2			47.9			5.8		42.1
Reclassification adjustments on cash flow hedges		2.8			0.5			2.3			1.8			-		1.8
Adjustments to prior service cost and unrecognized actuarial assumptions		(1.8	)		(0.6	)		(1.2	)		(0.3	)		0.1		(0.4	)
Total Other Comprehensive (Loss) Income	$	(16.8	)	$	(6.5	)	$	(10.3	)	$	31.8		$	21.0	$	10.8

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	Three Months Ended June 30, 2020									Six Months Ended June 30, 2020
	Before Tax			Tax			Net of Tax			Before Tax			Tax			Net of Tax
Foreign currency cumulative translation adjustments	$	4.3		$	(18.7	)	$	23.0		$	(24.9	)	$	6.3		$	(31.2	)
Unrealized cash flow hedge (losses) gains		(27.6	)		(4.9	)		(22.7	)		38.1			6.0			32.1
Reclassification adjustments on cash flow hedges		(15.0	)		(1.9	)		(13.1	)		(30.4	)		(3.8	)		(26.6	)
Adjustments to prior service cost and unrecognized actuarial assumptions		1.7			(0.4	)		2.1			3.4			1.6			1.8
Total Other Comprehensive Loss	$	(36.6	)	$	(25.9	)	$	(10.7	)	$	(13.8	)	$	10.1		$	(23.9	)

12.  Fair Value Measurement of Assets and Liabilities

The following financial assets and liabilities are recorded at fair value on a recurring basis (in millions):

	As of June 30, 2021
			Fair Value Measurements at Reporting Date Using:
Description	Recorded Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Derivatives designated as hedging, current and long-term
Foreign currency forward contracts	$	15.9	$	-	$	15.9	$	-
Cross-currency interest rate swaps		4.7		-		4.7		-
Interest rate swaps		0.8		-		0.8		-
Total Assets	$	21.4	$	-	$	21.4	$	-
Liabilities
Derivatives designated as hedging, current and long-term
Foreign currency forward contracts	$	12.1	$	-	$	12.1	$	-
Cross-currency interest rate swaps		13.4		-		13.4		-
Interest rate swaps		0.7		-		0.7		-
Contingent payments related to acquisitions		43.1		-		-		43.1
Total Liabilities	$	69.3	$	-	$	26.2	$	43.1

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	As of December 31, 2020
			Fair Value Measurements at Reporting Date Using:
Description	Recorded Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Derivatives designated as hedges, current and long-term
Foreign currency forward contracts	$	0.5	$	-	$	0.5	$	-
Derivatives not designated as hedges, current and long-term
Foreign currency forward contracts		0.9		-		0.9		-
Total Assets	$	1.4	$	-	$	1.4	$	-
Liabilities
Derivatives designated as hedges, current and long-term
Foreign currency forward contracts	$	48.5	$	-	$	48.5	$	-
Cross-currency interest rate swaps		83.3		-		83.3		-
Derivatives not designated as hedges, current and long-term
Foreign currency forward contracts		3.2		-		3.2		-
Contingent payments related to acquisitions		48.2		-		-		48.2
Total Liabilities	$	183.2	$	-	$	135.0	$	48.2

We value our foreign currency forward contracts using a market approach based on foreign currency exchange rates obtained from active markets, and we perform ongoing assessments of counterparty credit risk.  

We value our interest rate swaps using a market approach based on publicly available market yield curves and the terms of our swaps, and we perform ongoing assessments of counterparty credit risk. The valuation of the cross-currency interest rate swaps also includes consideration of foreign currency exchange rates.

Contingent payments related to acquisitions consist of sales-based payments, and are valued using discounted cash flow techniques.  The fair value of sales-based payments is based upon probability-weighted future revenue estimates, and increases as revenue estimates increase.  See Note 7 for additional information regarding contingent payments related to acquisitions.

The following table provides a reconciliation of the beginning and ending balances of items measured at fair value on a recurring basis in the tables above that used significant unobservable inputs (Level 3) (in millions):

	Level 3 - Liabilities
Contingent payments related to acquisitions
Beginning balance December 31, 2020	$	48.2
Change in estimate		2.0
Settlements		(6.8	)
Foreign currency impact		(0.3	)
Ending balance June 30, 2021	$	43.1

Changes in estimates for contingent payments related to acquisitions are recognized in Acquisition, integration, divestiture and related expenses on our condensed consolidated statements of earnings.

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13.  Derivative Instruments and Hedging Activities

We are exposed to certain market risks relating to our ongoing business operations, including foreign currency exchange rate risk, commodity price risk, interest rate risk and credit risk.  We manage our exposure to these and other market risks through regular operating and financing activities.  Currently, the only risks that we manage through the use of derivative instruments are interest rate risk and foreign currency exchange rate risk.

Interest Rate Risk

Derivatives Designated as Fair Value Hedges

We currently use fixed-to-variable interest rate swaps to manage our exposure to interest rate risk from our cash investments and debt portfolio.  These derivative instruments are designated as fair value hedges under GAAP. Changes in the fair value of the derivative instrument are recorded in current earnings and are offset by gains or losses on the underlying debt instrument.

In June 2021, we entered into $1 billion of fixed-to-variable interest rate swaps that we have designated as fair value hedges of $1 billion of our fixed rate debt obligations.

In prior years, we entered into various fixed-to-variable interest rate swap agreements that were accounted for as fair value hedges of our senior notes due 2021.  In August 2016, we received cash for these interest rate swap assets by terminating the hedging instruments with the counterparties.  The remaining unamortized balance as of June 30, 2021 related to these discontinued hedges was $1.4 million, which will be recognized using the effective interest rate method over the remaining maturity period of the hedged notes.  As of June 30, 2021 and December 31, 2020, the following amounts were recorded on our condensed consolidated balance sheets related to cumulative basis adjustments for fair value hedges (in millions):

	Carrying Amount of the Hedged Liabilities				Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities
Balance Sheet Line Item	June 30, 2021		December 31, 2020		June 30, 2021		December 31, 2020
Current portion of long-term debt	$	301.4	$	303.0	$	1.4	$	3.1
Long-term debt		995.7		-		0.1		-

Derivatives Designated as Cash Flow Hedges

In 2014, we entered into forward starting interest rate swaps that were designated as cash flow hedges of our thirty-year tranche of senior notes due 2045 we expected to issue in 2015. The forward starting interest rate swaps mitigated the risk of changes in interest rates prior to the completion of the notes offering.  The interest rate swaps were settled, and the remaining loss to be recognized at June 30, 2021 was $25.6 million, which will be recognized using the effective interest rate method over the remaining maturity period of the hedged notes.

Foreign Currency Exchange Rate Risk

We operate on a global basis and are exposed to the risk that our financial condition, results of operations and cash flows could be adversely affected by changes in foreign currency exchange rates. To reduce the potential effects of foreign currency exchange rate movements on net earnings, we enter into derivative financial instruments in the form of foreign currency exchange forward contracts with major financial institutions. We also designated our Euro Notes as net investment hedges of investments in foreign subsidiaries. We are primarily exposed to foreign currency exchange rate risk with respect to transactions and net assets denominated in Euros, Swiss Francs, Japanese Yen, British Pounds, Canadian Dollars, Australian Dollars, Korean Won, Swedish Krona, Czech Koruna, Thai Baht, Taiwan Dollars, South African Rand, Russian Rubles, Indian Rupees, Turkish Lira, Polish Zloty, Danish Krone, and Norwegian Krone. We do not use derivative financial instruments for trading or speculative purposes.

Derivatives Designated as Net Investment Hedges

We are exposed to the impact of foreign exchange rate fluctuations in the investments in our wholly-owned foreign subsidiaries that are denominated in currencies other than the U.S. Dollar. In order to mitigate the volatility in foreign exchange rates, we issued Euro Notes in December 2016 and November 2019 and designated 100 percent of the Euro Notes to hedge our net investment in certain wholly-owned foreign subsidiaries that have a functional currency of the Euro. All changes in the fair value of a hedging instrument designated as a net investment hedge are recorded as a component of AOCI in the condensed consolidated balance sheets.  

At June 30, 2021, we had receive-fixed-rate, pay-fixed-rate cross-currency interest swaps with notional amounts outstanding of Euro 775 million, Japanese Yen 7 billion and Swiss Franc 50 million.  These transactions further hedge our net investment in certain wholly-owned foreign subsidiaries that have a functional currency of Euro, Japanese Yen and Swiss Franc.  All changes in the fair

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value of a derivative instrument designated as a net investment hedge are recorded as a component of AOCI in the condensed consolidated balance sheets.  The portion of this change related to the excluded component will be amortized into earnings over the life of the derivative while the remainder will be recorded in AOCI until the hedged net investment is sold or substantially liquidated.  We recognize the excluded component in interest expense, net on our condensed consolidated statements of earnings.  The net cash received related to the receive-fixed-rate, pay-fixed-rate component of the cross-currency interest rate swaps is reflected in investing cash flows in our condensed consolidated statements of cash flows.  In the six-month period ended June 30, 2021, Euro 675 million of these cross-currency interest rate swaps matured at a loss of $37.1 million.  The settlement of this loss with the counterparties is reflected in investing cash flows in our condensed consolidated statements of cash flows and will remain in AOCI on our condensed consolidated balance sheet until the hedged net investment is sold or substantially liquidated.

Derivatives Designated as Cash Flow Hedges

Our revenues are generated in various currencies throughout the world.  However, a significant amount of our inventory is produced in U.S. Dollars.  Therefore, movements in foreign currency exchange rates may have different proportional effects on our revenues compared to our cost of products sold.  To minimize the effects of foreign currency exchange rate movements on cash flows, we hedge intercompany sales of inventory expected to occur within the next 30 months with foreign currency exchange forward contracts.  We designate these derivative instruments as cash flow hedges.  

We perform quarterly assessments of hedge effectiveness by verifying and documenting the critical terms of the hedge instrument and confirming that forecasted transactions have not changed significantly.  We also assess on a quarterly basis whether there have been adverse developments regarding the risk of a counterparty default.  For derivatives which qualify as hedges of future cash flows, the gains and losses are temporarily recorded in AOCI and then recognized in cost of products sold when the hedged item affects net earnings.  On our condensed consolidated statements of cash flows, the settlements of these cash flow hedges are recognized in operating cash flows.

For foreign currency exchange forward contracts and options outstanding at June 30, 2021, we had obligations to purchase U.S. Dollars and sell Euros, Japanese Yen, British Pounds, Canadian Dollars, Australian Dollars, Korean Won, Swedish Krona, Czech Koruna, Thai Baht, Taiwan Dollars, South African Rand, Russian Rubles, Indian Rupees, Polish Zloty, Danish Krone, and Norwegian Krone and obligations to purchase Swiss Francs and sell U.S. Dollars. These derivatives mature at dates ranging from July 2021 through December 2023. As of June 30, 2021, the notional amounts of outstanding forward contracts and options entered into with third parties to purchase U.S. Dollars were $1,459.1 million. As of June 30, 2021, the notional amounts of outstanding forward contracts and options entered into with third parties to purchase Swiss Francs were $324.0 million.

Derivatives Not Designated as Hedging Instruments

We enter into foreign currency forward exchange contracts with terms of one month to manage currency exposures for monetary assets and liabilities denominated in a currency other than an entity’s functional currency.  As a result, any foreign currency re-measurement gains/losses recognized in earnings are generally offset with gains/losses on the foreign currency forward exchange contracts in the same reporting period.  The net amount of these offsetting gains/losses is recorded in other expense, net.  These contracts are settled on the last day of each reporting period.  Therefore, there is no outstanding balance related to these contracts recorded on the balance sheet as of the end of the reporting period.  The notional amounts of these contracts are typically in a range of $1.5 billion to $2.0 billion per quarter.

Income Statement Presentation

Derivatives Designated as Cash Flow Hedges

Derivative instruments designated as cash flow hedges had the following effects, before taxes, on AOCI and net earnings on our condensed consolidated statements of earnings, condensed consolidated statements of comprehensive income (loss) and condensed consolidated balance sheets (in millions):

	Amount of Gain (Loss)										Amount of Gain (Loss)
	Recognized in AOCI										Reclassified from AOCI
	Three Months Ended					Six Months Ended					Three Months Ended						Six Months Ended
	June 30,					June 30,				Location on	June 30,						June 30,
Derivative Instrument	2021		2020			2021		2020		Statements of Earnings	2021			2020			2021			2020
Foreign exchange    forward contracts	$	0.4	$	(27.6	)	$	47.9	$	38.1	Cost of products sold	$	(2.6	)	$	15.1		$	(1.5	)	$	30.7
Forward starting    interest rate swaps		-		-			-		-	Interest expense, net		(0.2	)		(0.1	)		(0.3	)		(0.3	)
	$	0.4	$	(27.6	)	$	47.9	$	38.1		$	(2.8	)	$	15.0		$	(1.8	)	$	30.4

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The fair value of outstanding derivative instruments designated as cash flow hedges and recorded on our condensed consolidated balance sheet at June 30, 2021, together with settled derivatives where the hedged item has not yet affected earnings, was a net unrealized loss of $20.4 million, or $11.7 million after taxes, which is deferred in AOCI.  A loss of $4.4 million, or $4.0 million after taxes, is expected to be reclassified to earnings in cost of products sold and a loss of $0.6 million, or $0.5 million after taxes, is expected to be reclassified to earnings in interest expense, net over the next twelve months.

The following table presents the effect of fair value, cash flow and net investment hedge accounting on our condensed consolidated statements of earnings (in millions):

	Location and Amount of Gain/(Loss) Recognized in Income on Fair Value, Cash Flow and Net Investment Hedging Relationships for the Period Ended:
	Three Months Ended						Three Months Ended					Six Months Ended						Six Months Ended
	June 30, 2021						June 30, 2020					June 30, 2021						June 30, 2020
	Cost of			Interest			Cost of		Interest			Cost of			Interest			Cost of		Interest
	Products			Expense,			Products		Expense,			Products			Expense,			Products		Expense,
	Sold			Net			Sold		Net			Sold			Net			Sold		Net
Total amounts of income and expense line items presented in the statements of earnings in which the effects of fair value, cash flow and net investment hedges are recorded	$	581.6		$	(54.7	)	$	424.5	$	(54.0	)	$	1,098.0		$	(107.0	)	$	911.6	$	(104.9	)
The effects of fair value, cash flow and net investment hedging:
Gain on fair value hedging                   relationships
Discontinued interest rate swaps		-			0.8			-		0.8			-			1.7			-		1.7
Gain (loss) on cash flow hedging                   relationships
Foreign exchange forward contracts		(2.6	)		-			15.1		-			(1.5	)		-			30.7		-
Forward starting interest rate swaps		-			(0.2	)		-		(0.1	)		-			(0.3	)		-		(0.3	)
Gain on net investment hedging                   relationships
Cross-currency interest rate swaps		-			10.4			-		13.4			-			23.8			-		26.8

Derivatives Not Designated as Hedging Instruments

The following (losses)/gains from these derivative instruments were recognized on our condensed consolidated statements of earnings (in millions):

		Three Months Ended						Six Months Ended
	Location on	June 30,						June 30,
Derivative Instrument	Statements of Earnings	2021			2020			2021			2020
Foreign exchange forward contracts	Other expense, net	$	(1.4	)	$	(7.7	)	$	(7.7	)	$	15.4

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These (losses)/gains do not reflect offsetting gains of $0.9 million in the three-month period ended June 30, 2021, offsetting gains of $1.6 million in the three-month period ended June 30, 2020, offsetting gains of $4.3 million in the six-month period ended June 30, 2021, and offsetting losses of $21.9 million in the six-month period ended June 30, 2020, recognized in other income, net as a result of foreign currency re-measurement of monetary assets and liabilities denominated in a currency other than an entity’s functional currency.

Balance Sheet Presentation

As of June 30, 2021 and December 31, 2020, all derivatives designated as fair value hedges, cash flow hedges and net investment hedges are recorded at fair value on our condensed consolidated balance sheets.  On our condensed consolidated balance sheets, we recognize individual forward contracts with the same counterparty on a net asset/liability basis if we have a master netting agreement with the counterparty.  Under these master netting agreements, we are able to settle derivative instrument assets and liabilities with the same counterparty in a single transaction, instead of settling each derivative instrument separately.  We have master netting agreements with all of our counterparties.  The fair value of derivative instruments on a gross basis is as follows (in millions):  

	As of June 30, 2021			As of December 31, 2020
	Balance			Balance
	Sheet	Fair		Sheet	Fair
	Location	Value		Location	Value
Asset Derivatives Designated as Hedges
Foreign exchange forward contracts	Other current assets	$	22.0	Other current assets	$	12.2
Cross-currency interest rate swaps	Other current assets		0.5	Other current assets		-
Foreign exchange forward contracts	Other assets		13.8	Other assets		3.7
Cross-currency interest rate swaps	Other assets		4.2	Other assets		-
Interest rate swaps	Other assets		0.8	Other assets		-
Total asset derivatives		$	41.3		$	15.9
Asset Derivatives Not Designated as Hedges
Foreign exchange forward contracts	Other current assets	$	-	Other current assets	$	1.5
Liability Derivatives Designated as Hedges
Foreign exchange forward contracts	Other current liabilities	$	23.1	Other current liabilities	$	37.4
Cross-currency interest rate swaps	Other current liabilities		8.3	Other current liabilities		55.0
Foreign exchange forward contracts	Other long-term liabilities		8.9	Other long-term liabilities		26.5
Cross-currency interest rate swaps	Other long-term liabilities		5.1	Other long-term liabilities		28.3
Interest rate swaps	Other long-term liabilities		0.7	Other long-term liabilities		-
Total liability derivatives		$	46.1		$	147.2
Liability Derivatives Not Designated as Hedges
Foreign exchange forward contracts	Other current liabilities	$	-	Other current liabilities	$	3.8

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The table below presents the effects of our master netting agreements on our condensed consolidated balance sheets (in millions):

		As of June 30, 2021						As of December 31, 2020
Description	Location	Gross Amount		Offset		Net Amount in Balance Sheet		Gross Amount		Offset		Net Amount in Balance Sheet
Asset Derivatives
Cash flow hedges	Other current assets	$	22.0	$	13.6	$	8.4	$	12.2	$	11.7	$	0.5
Cash flow hedges	Other assets		13.8		6.3		7.5		3.7		3.7		-
Derivatives Not Designated as Hedges	Other current assets		-		-		-		1.5		0.6		0.9
Liability Derivatives
Cash flow hedges	Other current liabilities		23.1		13.6		9.5		37.4		11.7		25.7
Cash flow hedges	Other long-term liabilities		8.9		6.3		2.6		26.5		3.7		22.8
Derivatives Not Designated as Hedges	Other current liabilities		-		-		-		3.8		0.6		3.2

The following net investment hedge gains (losses) were recognized on our condensed consolidated statements of comprehensive income (loss) (in millions):

	Amount of Gain (Loss)
	Recognized in AOCI
	Three Months Ended						Six Months Ended
	June 30,						June 30,
Derivative Instrument	2021			2020			2021		2020
Euro Notes	$	(15.9	)	$	(39.0	)	$	56.4	$	(0.9	)
Cross-currency interest rate swaps		(28.1	)		(41.6	)		37.5		28.1
	$	(44.0	)	$	(80.6	)	$	93.9	$	27.2

14.  Income Taxes

We operate on a global basis and are subject to numerous and complex tax laws and regulations.  Additionally, tax laws continue to undergo rapid changes in both application and interpretation by various countries, including state aid interpretations and initiatives led by the Organization for Economic Cooperation and Development.  Our income tax filings are subject to examinations by taxing authorities throughout the world. Income tax audits may require an extended period of time to reach resolution and may result in significant income tax adjustments when interpretation of tax laws or allocation of company profits is disputed.  Although ultimate timing is uncertain, the net amount of tax liability for unrecognized tax benefits may change within the next twelve months due to changes in audit status, expiration of statutes of limitations, settlements of tax assessments and other events.  Management’s best estimate of such change is within the range of a $250 million decrease to a $20 million increase.

We are under continuous audit by the IRS and other taxing authorities.  During the course of these audits, we receive proposed adjustments from taxing authorities that may be material.  Therefore, there is a possibility that an adverse outcome in these audits could have a material effect on our results of operations and financial condition.  Our U.S. Federal income tax returns have been audited through 2015 and are currently under audit for years 2016-2019.   

In October 2020, we reached agreement with the IRS for tax years 2006-2012 related to the reallocation of profits between the U.S. and Puerto Rico as well as other miscellaneous adjustments.  

The IRS has proposed adjustments for tax years 2010-2012, primarily related to reallocating profits between certain of our U.S. and foreign subsidiaries, which remain unsettled.  We have disputed these adjustments and intend to continue to vigorously defend our positions as we pursue resolution through the administrative process with the IRS Independent Office of Appeals.  

The IRS has proposed adjustments for tax years 2013-2015 relating to transfer pricing involving our cost sharing agreement between the U.S. and Switzerland affiliated companies and reallocating profits between certain of our U.S. and foreign subsidiaries.  This includes a proposed increase to our U.S. Federal taxable income, which would result in additional tax expense related to 2013 of approximately $370 million, subject to interest and penalties related to our cost sharing agreement.  We strongly believe that the position of the IRS, with regard to this matter, is inconsistent with the applicable U.S. Treasury regulations governing our cost sharing agreement.  We do not expect changes to our reserves relative to these matters within the next twelve months.  We intend to vigorously contest the adjustment, and we will pursue all available administrative and, if necessary, judicial remedies.  If we pursue judicial remedies in the U.S. Tax Court for years 2013-2015, a number of years will likely elapse before such matters are finally resolved.  No payment of any amount related to this matter is required to be made, if at all, until all applicable proceedings have been completed.  

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A public referendum held in Switzerland passed the Federal Act on Tax Reform and AHV Financing (“TRAF”), effective January 1, 2020.  The TRAF provides transitional relief measures for companies that are losing the tax benefit of a ruling, including a "step-up" for amortizable goodwill, equal to the amount of future tax benefit they would have received under their existing ruling, subject to certain limitations.  This resulted in the recording of a deferred tax asset for future deductions of tax goodwill. For the six-month period ended June 30, 2021, we recognized benefits of $10.0 million related to certain adjustments to the estimated net deferred tax asset from the filing of tax returns.  

In the three and six-month periods ended June 30, 2021, our effective tax rate (“ETR”) was 18.0 percent and 13.8 percent, respectively, compared to 6.2 percent and 1.2 percent in the three and six-month periods ended June 30, 2020, respectively.  The 18.0 percent ETR in the three-month period ended June 30, 2021, was primarily due to our mix of earnings between U.S. and foreign locations.  The 13.8 percent ETR in the six-month period ended June 30, 2021, was the result of favorable discrete adjustments from the filing of Swiss tax returns and an excess tax benefit related to stock-based compensation.  The 6.2 percent ETR in the three-month period ended June 30, 2020, was the result of the mix of some of our jurisdictions recognizing earnings while others had losses. The 1.2 percent ETR in the six-month period ended June 30, 2020, was primarily due to the $612.0 million goodwill impairment charge, which resulted in a loss before taxes, but has no corresponding tax benefit, as well as the mix of earnings and losses among our jurisdictions.  Absent discrete tax events, we expect our future ETR will be lower than the U.S. corporate income tax rate of 21.0 percent due to our mix of earnings between U.S. and foreign locations, which have lower corporate income tax rates.  Our ETR in future periods could also potentially be impacted by: changes in our mix of pre-tax earnings; changes in tax rates, tax laws or their interpretation; the outcome of various federal, state and foreign audits; and the expiration of certain statutes of limitations.  Currently, we cannot reasonably estimate the impact of these items on our financial results.

15.  Earnings Per Share

The following is a reconciliation of weighted average shares for the basic and diluted shares computations (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Weighted average shares outstanding for basic net earnings (loss) per share		208.6		206.8		208.3		206.6
Effect of dilutive stock options and other equity awards		2.1		-		2.1		-
Weighted average shares outstanding for diluted net earnings (loss) per share		210.7		206.8		210.4		206.6

During each of the three and six-month periods ended June 30, 2021, an average of 0.4 million options to purchase shares of common stock were not included in the computation of diluted earnings per share because the exercise prices of these options were greater than the average market price of our common stock.   Since we incurred a net loss in the three and six-month periods ended June 30, 2020, no dilutive stock options or other equity awards were included as diluted shares.

16.  Segment Information

We design, manufacture and market orthopedic reconstructive products; sports medicine, biologics, extremities and trauma products; spine, craniomaxillofacial and thoracic products (“CMFT”); office based technologies; dental implants; and related surgical products.  Our chief operating decision maker (“CODM”) allocates resources to achieve our operating profit goals through four operating segments.  These operating segments, which also constitute our reportable segments, are Americas Orthopedics; EMEA; Asia Pacific; and Americas Spine and Global Dental.  

As a result of changes to our organizational structure in advance of the planned spin off of SpinCo that were effective April 1, 2021, we added an additional operating segment to reflect a change in how our CODM allocates resources to achieve our operating profit goals.  The new operating segment consists of the Americas Spine and Global Dental businesses, which was carved out of the previous Americas and Global Businesses operating segment (subsequently renamed to Americas Orthopedics).  The EMEA and Asia Pacific operating segments still include the spine product category results in those regions and therefore did not change.  

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Additionally, starting April 1, 2021 the financial information provided to the CODM from the Americas Orthopedics excluded certain costs related to operations, distribution, quality assurance and regulatory assurance that had previously been reported within this segment.  This group of functions and related costs do not meet the criteria to be a separate operating segment and are now reported within Corporate functions.  

We have reclassified previously reported information related to the change in operating segments and Corporate functions, along with other insignificant changes, to conform to the new presentation.

Our CODM evaluates performance based upon segment operating profit exclusive of operating expenses pertaining to inventory and manufacturing-related charges, intangible asset amortization, goodwill and intangible asset impairment, restructuring and other cost reduction initiatives, quality remediation, acquisition, integration, divestiture and related, litigation, certain European Union Medical Device Regulation (“EU MDR”) expenses, certain R&D agreements, other charges and corporate functions.  Corporate functions include corporate legal, finance, information technology, human resources and other corporate departments as well as certain operations, distribution, quality assurance and regulatory assurance expenses.  Intercompany transactions have been eliminated from segment operating profit.

Our Americas Orthopedics operating segment is comprised principally of the U.S. and includes other North, Central and South American markets for our orthopedic product categories.  This segment also includes research, development engineering, medical education, and brand management for our orthopedic product category headquarter locations.  Our EMEA operating segment is comprised principally of Europe and includes the Middle East and African markets for all product categories except Dental.  Our Asia Pacific operating segment is comprised principally of Japan, China and Australia and includes other Asian and Pacific markets for all product categories except Dental.  The EMEA and Asia Pacific operating segments include the commercial operations as well as regional headquarter expenses to operate in those markets.  The Americas Spine and Global Dental segment is comprised principally of the U.S. and includes other North, Central and South American markets for our spine business, and all geographic markets for our dental business.  This segment also includes research, development engineering, medical education and brand management at the product category headquarter locations as well as other directly attributable distribution and operations expenses.  

Since the Americas Orthopedics segment includes additional costs related to centralized orthopedic product category headquarter expenses, profitability metrics in this operating segment are not comparable to the EMEA and Asia Pacific operating segments.  Similarly, since the Americas Spine and Global Dental segment also includes research, development engineering, medical education, and brand management at the product category headquarter locations as well as other directly attributable distribution and operations expenses, its profitability metrics are not comparable to the other operating segments.  

Our CODM does not review asset information by operating segment.  Instead, our CODM reviews cash flow and other financial ratios by operating segment.

Net sales and operating profit by segment are as follows (in millions):

	Net Sales				Operating Profit (Loss)
	Three Months Ended				Three Months Ended
	June 30,				June 30,
	2021		2020		2021			2020
Americas Orthopedics	$	1,058.3	$	626.5	$	445.4		$	203.7
EMEA		392.9		204.1		95.2			20.1
Asia Pacific		345.7		264.5		111.4			78.4
Americas Spine and Global Dental		230.0		131.0		40.1			(3.4	)
Total	$	2,026.9	$	1,226.1
Corporate Functions						(162.0	)		(229.0	)
Inventory and manufacturing-related charges						(7.9	)		(1.4	)
Intangible asset amortization						(154.6	)		(147.7	)
Goodwill and intangible asset impairment						(16.3	)		(33.0	)
Restructuring and other cost reduction initiatives						(19.7	)		(28.0	)
Quality remediation						(11.0	)		(9.9	)
Acquisition, integration, divestiture and related						(25.4	)		(2.2	)
Litigation						(3.6	)		(1.3	)
European Union Medical Device Regulation						(10.6	)		(6.1	)
Certain R&D agreements						(65.0	)		-
Other charges						4.5			(11.9	)
Operating profit (loss)					$	220.5		$	(171.7	)

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	Net Sales				Operating Profit (Loss)
	Six Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021			2020
Americas Orthopedics	$	2,004.5	$	1,569.5	$	832.5		$	607.0
EMEA		742.0		575.4		181.5			128.9
Asia Pacific		682.6		540.4		231.7			171.0
Americas Spine and Global Dental		445.2		324.6		79.1			22.5
Total	$	3,874.3	$	3,009.9
Corporate Functions						(318.4	)		(393.4	)
Inventory and manufacturing-related charges						(2.0	)		(2.0	)
Intangible asset amortization						(310.1	)		(295.3	)
Goodwill and intangible asset impairment						(16.3	)		(645.0	)
Restructuring and other cost reduction initiatives						(41.6	)		(73.0	)
Quality remediation						(21.2	)		(25.8	)
Acquisition, integration, divestiture and related						(38.8	)		(6.6	)
Litigation						(9.7	)		(81.1	)
European Union Medical Device Regulation						(17.5	)		(17.1	)
Certain R&D agreements						(65.0	)	-
Other charges						1.9			(17.8	)
Operating profit (loss)					$	486.1		$	(627.7	)

17.  Commitments and Contingencies

On a quarterly and annual basis, we review relevant information with respect to loss contingencies and update our accruals, disclosures and estimates of reasonably possible losses or ranges of loss based on such reviews.  We establish liabilities for loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.  For matters where a loss is believed to be reasonably possible, but not probable, no accrual has been made.

Litigation

Durom Cup-related claims:  On July 22, 2008, we temporarily suspended marketing and distribution of the Durom Cup in the U.S.  Subsequently, a number of product liability lawsuits were filed against us in various U.S. and foreign jurisdictions.  The plaintiffs seek damages for personal injury, and they generally allege that the Durom Cup contains defects that result in complications and premature revision of the device.  We have settled the majority of these claims and others are still pending.  The majority of the pending U.S. lawsuits are currently in a federal Multidistrict Litigation (“MDL”) in the District of New Jersey (In Re: Zimmer Durom Hip Cup Products Liability Litigation).  Litigation activity in the MDL is stayed pending finalization of the U.S. Durom Cup Settlement Program, an extrajudicial program created to resolve actions and claims of eligible U.S. plaintiffs and claimants.  Other lawsuits are pending in various domestic and foreign jurisdictions, and additional claims may be asserted in the future.  The majority of claims outside the U.S. are pending in Germany, Netherlands and Italy.

Our estimate as of June 30, 2021 of the remaining liability for all Durom Cup-related claims, including estimated legal fees, is $47.9 million.  

Our understanding of clinical outcomes with the Durom Cup and other large diameter hip cups continues to evolve.  We rely on significant estimates in determining the provisions for Durom Cup-related claims, including our estimate of the number of claims that we will receive and the average amount we will pay per claim.  The actual number of claims and the actual amount we pay per claim may differ from our estimates.  Among other factors, since our understanding of the clinical outcomes is still evolving, we cannot reasonably estimate the possible loss or range of loss that may result from Durom Cup-related claims in excess of the losses we have accrued.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

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Zimmer M/L Taper, M/L Taper with Kinectiv Technology, and Versys Femoral Head-related claims (“Metal Reaction” claims): We are a defendant in a number of product liability lawsuits relating to our M/L Taper and M/L Taper with Kinectiv Technology hip stems, and Versys Femoral Head implants.  The plaintiffs seek damages for personal injury, alleging that defects in the products lead to corrosion at the head/stem junction resulting in, among other things, pain, inflammation and revision surgery. 

The majority of the cases are consolidated in an MDL that was created on October 3, 2018 in the U.S. District Court for the Southern District of New York (In Re: Zimmer M/L Taper Hip Prosthesis or M/L Taper Hip Prosthesis with Kinectiv Technology and Versys Femoral Head Products Liability Litigation).  Other related cases are pending in various state and federal courts.  Additional lawsuits are likely to be filed.  Our estimate as of June 30, 2021 of the remaining liability for all Metal Reaction-related claims, including our estimated legal fees, is $49.2 million.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

Biomet metal-on-metal hip implant claims:  Biomet is a defendant in a number of product liability lawsuits relating to metal-on-metal hip implants, most of which involve the M2a-Magnum hip system.  Cases are currently consolidated in an MDL in the U.S. District Court for the Northern District of Indiana (In Re: Biomet M2a Magnum Hip Implant Product Liability Litigation) and in various state, federal and foreign courts, with the majority of domestic state court cases pending in Indiana and Florida.

On February 3, 2014, Biomet announced the settlement of the MDL.  Lawsuits filed in the MDL by April 15, 2014 were eligible to participate in the settlement.  Those claims that did not settle via the MDL settlement program have re-commenced litigation in the MDL under a new case management plan, or have been or are in the process of being remanded to their originating jurisdictions.  The settlement does not affect certain other claims relating to Biomet’s metal-on-metal hip products that are pending in various state and foreign courts, or other claims that may be filed in the future.  Trials have commenced, and other trials are currently scheduled to occur in the future.  Although each case will be tried on its particular facts, a verdict and subsequent final judgment for the plaintiff in one or more of these cases could have a substantial impact on our potential liability.  Our estimate as of June 30, 2021 of the remaining liability for all Biomet metal-on-metal hip implant claims, including estimated legal fees, is $69.5 million.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

Heraeus trade secret misappropriation lawsuits:  In December 2008, Heraeus Kulzer GmbH (together with its affiliates, “Heraeus”) initiated legal proceedings in Germany against Biomet, Inc., Biomet Europe BV (now Zimmer Biomet Nederland BV), certain other entities and certain employees alleging that the defendants misappropriated Heraeus trade secrets when developing Biomet Europe’s Refobacin and Biomet Bone Cement line of cements (“European Cements”).  The lawsuit sought to preclude the defendants from producing, marketing and offering for sale their then-current line of European Cements and to compensate Heraeus for any damages incurred.

Germany: On June 5, 2014, the German appeals court in Frankfurt (i) enjoined Biomet, Inc., Biomet Europe BV and Biomet Deutschland GmbH from manufacturing, selling or offering the European Cements to the extent they contain certain raw materials in particular specifications; (ii) held the defendants jointly and severally liable to Heraeus for any damages from the sale of European Cements since 2005; and (iii) ruled that no further review may be sought (the “Frankfurt Decision”).  The Heraeus and Biomet parties both sought appeal against the Frankfurt Decision.  In a decision dated June 16, 2016, the German Supreme Court dismissed the parties’ appeals without reaching the merits, rendering that decision final.

In December 2016, Heraeus filed papers to restart proceedings against Biomet Orthopaedics Switzerland GmbH (now Zimmer GmbH), seeking to require that entity to relinquish its CE certificates for the European Cements.  In January 2017, Heraeus notified Biomet it had filed a claim for damages in the amount of €121.9 million for sales in Germany, which it first increased to €125.9 million and with a filing in June 2019 further increased to €146.7 million plus statutory interest.  In a court filing, Heraeus indicated that it might further increase its claims in the course of the proceedings.  As of June 30, 2021, these two proceedings remained pending in front of the Darmstadt court.  In September 2017, Heraeus filed an enforcement action in the Darmstadt court against Biomet Europe (now Zimmer Biomet Nederland B.V.), requesting that a fine be imposed against Biomet Europe for failure to disclose the amount of the European Cements which Biomet Orthopaedics Switzerland had ordered to be manufactured in Germany (e.g., for the Chinese market).  In June 2018, the Darmstadt court dismissed Heraeus’ request.  Heraeus appealed the decision.  The appeal remained pending as of June 30, 2021.  Also in September 2017, Heraeus filed suit against Zimmer Biomet Deutschland in the court of first instance in Freiburg concerning the sale of the European Cements with certain changed raw materials.  Heraeus sought an injunction on the basis that the continued use of the product names for the European Cements was misleading for customers and thus an act of unfair competition.  On June 29, 2018, the court in Freiburg, Germany dismissed Heraeus’ request for an injunction prohibiting the marketing of the European Cements under their current names on the grounds that the same request had already been decided upon by the Frankfurt Decision which became final and binding.  Heraeus appealed this decision to the Court of Appeals in Karlsruhe, Germany.  The appeals hearing occurred in December 2019 and on June 19, 2020, the court dismissed the appeal on different grounds, namely that the appeals court did not find any unfair competition in the continued use of the product names.  Although the appeals court did not grant leave to appeal, Heraeus had initially filed a request for appeal with the German Supreme Court, but it withdrew that request in November 2020.

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United States: On September 8, 2014, Heraeus filed a complaint against a Biomet supplier, Esschem, Inc. (“Esschem”), in the U.S. District Court for the Eastern District of Pennsylvania.  The lawsuit contained allegations that focused on two copolymer compounds that Esschem sold to Biomet, which Biomet incorporated into certain bone cement products that compete with Heraeus’ bone cement products.  The complaint alleged that Biomet helped Esschem to develop these copolymers, using Heraeus trade secrets that Biomet allegedly misappropriated.  The complaint asserted a claim under the Pennsylvania Uniform Trade Secrets Act, as well as other various common law tort claims, all based upon the same trade secret misappropriation theory.  Heraeus sought to enjoin Esschem from supplying the copolymers to any third party and actual damages.  The complaint also sought punitive damages, costs and attorneys’ fees.  Although Biomet was not a party to this lawsuit, Biomet agreed, at Esschem’s request and subject to certain limitations, to indemnify Esschem for any liability, damages and legal costs related to this matter.  On November 3, 2014, the court entered an order denying Heraeus’ motion for a temporary restraining order.  On June 30, 2016, the court entered an order denying Heraeus’ request to give preclusive effect to the factual findings in the Frankfurt Decision.  On June 6, 2017, the court entered an order denying Heraeus’ motion to add Biomet as a party to the lawsuit.  On January 26, 2018, the court entered an order granting Esschem’s motion for summary judgment and dismissed all of Heraeus’ claims with prejudice.  On February 21, 2018, Heraeus filed a notice of appeal to the U.S. Court of Appeals for the Third Circuit, which heard oral argument on the appeal on October 23, 2018.  On June 21, 2019, the Third Circuit partially reversed the decision of the U.S. District Court for the Eastern District of Pennsylvania granting Esschem summary judgment and remanded the case back to the lower court.  On July 5, 2019, Esschem filed a petition in the Third Circuit for rehearing en banc and a motion in the alternative to certify a question of state law to the Supreme Court of Pennsylvania, which was denied on August 1, 2019.  On January 8, 2021, the court entered a scheduling order for the completion of fact and expert discovery and filing of dispositive motions but did not set a trial date.

On December 7, 2017, Heraeus filed a complaint against Zimmer Biomet Holdings, Inc. and Biomet, Inc. in the U.S. District Court for the Eastern District of Pennsylvania alleging a single claim of trade secret misappropriation under the Pennsylvania Uniform Trade Secrets Act based on the same factual allegations as the Esschem litigation.  On March 5, 2018, Heraeus filed an amended complaint adding a second claim of trade secret misappropriation under Pennsylvania common law.  Heraeus seeks to enjoin the Zimmer Biomet parties from future use of the allegedly misappropriated trade secrets and recovery of unspecified damages for alleged past use.  On April 18, 2018, the Zimmer Biomet parties filed a motion to dismiss both claims.  On March 8, 2019, the court stayed the case pending the Third Circuit’s decision in the Esschem case described above.  In September 2019, the Zimmer Biomet parties filed a motion to stay the proceedings pending (1) the court’s decision on Esschem’s motion for summary judgment in the Esschem case described above and (2) the outcome of a U.S. International Trade Commission (“ITC”) complaint filed by Heraeus asserting similar claims.  On May 2, 2020, the court granted the Zimmer Biomet parties’ motion to stay the proceedings pending the outcome of the ITC complaint filed by Heraeus.  The related ITC investigation is complete.  In June 2021, Heraeus filed a motion to lift the stay of proceedings and attached a draft motion for preliminary injunction enjoining Zimmer Biomet from continuing to manufacture and sell its bone cements.  As of June 30, 2021, the court has not dissolved the stay.  Although we are vigorously defending this lawsuit, the ultimate outcome is uncertain.  An adverse ruling in this case could have a material adverse effect on our business, financial condition and results of operations.

Other European Countries: Heraeus continues to pursue other related legal proceedings in Europe seeking various forms of relief, including injunctive relief and damages, against various Biomet-related and local Zimmer Biomet entities relating to the European Cements, including those described herein.  On October 2, 2018, the Belgian Court of Appeal of Mons issued a judgment in favor of Heraeus relating to its request for past damages caused by the alleged misappropriation of its trade secrets, and an injunction preventing future sales of certain European Cements in Belgium (the “Belgian Decision”).  We appealed this judgment to the Belgian Supreme Court.  The Belgian Supreme Court dismissed our appeal in October 2019 and this decision is final.  Proceedings to assess the amount of damages potentially owed to Heraeus under the Belgian Decision remain pending.  Heraeus filed a suit in Belgium concerning the continued sale of the European Cements with certain changed materials.  Like its former suit in Germany, Heraeus seeks an injunction on the basis that the continued use of the product names for the European Cements is misleading for customers and thus an act of unfair competition.  On May 7, 2019, the Liège Commercial Court issued a judgment that Zimmer Biomet failed to inform its hospital and surgeon customers of the changes made to the composition of the cement with certain changed materials and ordered, as a sole remedy, that Zimmer Biomet send letters to those customers, which we have done.  An appeals hearing took place on January 13, 2021.  On February 10, 2021, the court of appeals dismissed the appeals of Heraeus and Zimmer Biomet, which ended the unfair competition proceedings regarding the continued use of the product names.  In November 2020, Heraeus also initiated proceedings in Belgium seeking an injunction and damages related to the distribution of the European Cements in the revised formulation.  Heraeus claims that the revised formulation still misappropriates its alleged trade secrets.  The proceedings are pending, and a decision is not expected in 2021.

On February 13, 2019, a Norwegian court of first instance issued a judgment in favor of Heraeus on its claim for misappropriation of trade secrets.  The court awarded damages of 19,500,000 NOK, or approximately $2.3 million, plus attorneys’ fees, and issued an injunction, which was never enforced, preventing Zimmer Biomet Norway from marketing in Norway bone cements identified with the current product names and bone cements making use of the trade secrets which were acknowledged in the Frankfurt Decision.  We appealed the Norwegian judgment to the court of second instance and an appeals trial was held in March 2021.  On April 30, 2021, the appeals court in Norway found in favor of Zimmer Biomet and reversed the decision of the court of first instance.  The appeals court ruled that Heraeus did not substantiate that the alleged trade secrets were useful and thus did not qualify as trade secrets, and additionally determined that the alleged trade secrets were not actually used or misappropriated.  Heraeus sought leave to appeal to the Norwegian supreme court, which the court denied on July 13, 2021.  The decision of the appeals court in favor of Zimmer Biomet is now final.

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On October 29, 2019, an Italian court of first instance issued a judgment in favor of Heraeus on its claim of misappropriation of trade secrets, but did not yet order an award of damages.  We filed a timely appeal of the decision and the appellate hearing took place on May 27, 2021.  On July 19, 2021, the court of appeals reopened the case and ordered the appointment of a technical expert so it can ascertain whether the trade secrets enforced by Heraeus are secret according to the law and have been protected by adequate protective measures.  Heraeus has not initiated damages proceedings, but could do so in the future based on the non-final first instance decision.

On January 23, 2020, a Finnish Market Court issued a judgment partly in favor of Heraeus on its claim of misappropriation of certain trade secrets.  Damage claims were not raised in the proceedings.  We appealed the decision to the Finnish Supreme Court.  On July 3, 2020, the Finnish Supreme Court declined to review the case, rendering the Market Court decision final.  In March 2021, Heraeus initiated damages proceedings, claiming damages of €13.84 million, or approximately $16.6 million.

Heraeus is pursuing damages and injunctive relief in France in an effort to prevent us from manufacturing, marketing and selling the European Cements (the “France Litigation”).  The European Cements are manufactured at our facility in Valence, France.  On December 11, 2018, a hearing was held in the France Litigation before the commercial court in Romans-sur-Isère.  On May 23, 2019, the commercial court ruled in our favor.  On July 12, 2019, Heraeus filed an appeal to the court of second instance in Grenoble, France.  Although we are vigorously defending the France Litigation, the ultimate outcome is uncertain.  An adverse ruling in the France Litigation could have a material adverse effect on our business, financial condition and results of operations.

We have accrued an estimated loss relating to the collective trade secret litigation, including estimated legal costs to defend.  Damages relating to the Frankfurt Decision are subject to separate proceedings, and the German and Belgian courts appointed experts to determine the amount of damages related to the Frankfurt and Belgian Decisions, respectively.  Thus, it is reasonably possible that our estimate of the loss we may incur may change in the future.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

Shareholder Derivative Actions:  On June 14, 2019 and July 29, 2019, two shareholder derivative actions, Green v. Begley et al. and Detectives Endowment Association Annuity Fund v. Begley et al., were filed in the Court of Chancery in the State of Delaware.  On October 2, 2019 and October 11, 2019, two additional shareholder derivative actions, Karp v. Begley et al. and DiGaudio v. Begley et al., were filed in the U.S. District Court for the District of Delaware.  The plaintiff in each action seeks to maintain the action purportedly on our behalf against certain of our current and former directors and officers (the “individual defendants”) and certain former stockholders of ours who sold shares of our common stock in various secondary public offerings in 2016 (the “private equity fund defendants”).  The plaintiff in each action alleges, among other things, breaches of fiduciary duties against the individual defendants and insider trading against two individual defendants and the private equity fund defendants based on factual allegations that the defendants violated federal securities laws by making materially false and/or misleading statements and/or omissions about our compliance with U.S. Food and Drug Administration (“FDA”) regulations and our ability to continue to accelerate our organic revenue growth rate in the second half of 2016.  On June 4, 2020, the plaintiffs in the Chancery Court actions filed a consolidated amended complaint adding three new counts and expanding the scope of the alleged materially false statements.  On September 14, 2020, the defendants filed motions to dismiss the Chancery Court actions.  Oral argument occurred on June 15, 2021.  A decision is expected in late 2021.  Also on September 14, 2020, the plaintiffs in the U.S. District Court actions filed a consolidated amended complaint adding certain details to their allegations.  On October 9, 2020, the U.S. District Court granted the parties’ joint motion to stay the U.S. District Court actions pending resolution of the motions to dismiss the Chancery Court actions.  The plaintiffs in the Chancery Court and the U.S. District Court actions do not seek damages from us, but instead request damages on our behalf from the defendants of an unspecified amount, as well as attorneys’ fees, costs and other relief.  

Regulatory Matters, Government Investigations and Other Matters  

U.S. International Trade Commission Investigation: On March 5, 2019, Heraeus filed a complaint with the ITC against us and certain of our subsidiaries.  The complaint alleges that Biomet misappropriated Heraeus’ trade secrets in the formulation and manufacture of two bone cement products now sold by Zimmer Biomet, both of which are imported from our Valence, France facility.  Heraeus requested that the ITC institute an investigation and, after the investigation, issue a limited exclusion order and cease and desist orders.  On April 5, 2019, the ITC ordered an investigation be instituted into whether we have committed an “unfair act” in the importation, sale for importation, or sale after importation of certain bone cement products, the threat or effect of which is to destroy or substantially injure an industry in the United States, in violation of Section 337 of the Tariff Act of 1930, as amended (“Section 337”).  An evidentiary hearing in front of an administrative law judge at the ITC was held in January 2020 and an Initial Determination was issued on May 6, 2020.  In the Initial Determination, the administrative law judge held that we did not violate Section 337, and thus we are not restricted from continuing to manufacture and sell the two challenged bone cement products in the United States.  On July 13, 2020, the ITC issued a notice of intent to review the Initial Determination and on January 12, 2021 it issued a Final Determination which affirmed the Initial Determination with modifications and terminated the investigation with a finding of no violation of Section 337.  Heraeus did not appeal the Final Determination.

FDA warning letter:  In August 2018, we received a warning letter from the FDA related to observed non-conformities with current good manufacturing practice requirements of the Quality System Regulation (21 CFR Part 820) (“QSR”) at our legacy Biomet manufacturing facility in Warsaw, Indiana (this facility is sometimes referred to in this report as the “Warsaw North Campus”).  We have provided detailed responses to the FDA as to our corrective actions and will continue to work expeditiously to address the issues

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identified by the FDA during inspections in Warsaw.  As of June 30, 2021, the Warsaw warning letter remained pending.  Until the violations cited in the pending warning letter are corrected, we may be subject to additional regulatory action by the FDA, as described more fully below.  Additionally, requests for Certificates to Foreign Governments may not be granted and premarket approval applications for Class III devices to which the QSR deviations are reasonably related will not be approved until the violations have been corrected.  In addition to responding to the warning letter described above, we are in the process of addressing various FDA Form 483 inspectional observations at certain of our manufacturing facilities, including observations issued by the FDA following an inspection of the Warsaw North Campus in January 2020, which inspection the FDA has classified as Voluntary Action Indicated (“VAI”).  The ultimate outcome of these matters is presently uncertain.  Among other available regulatory actions, the FDA may impose operating restrictions, including a ceasing of operations, at one or more facilities, enjoining and restraining certain violations of applicable law pertaining to products, seizure of products and assessing civil or criminal penalties against our officers, employees or us.  The FDA could also issue a corporate warning letter or a recidivist warning letter or negotiate the entry of a consent decree of permanent injunction with us.  The FDA may also recommend prosecution by the U.S. Department of Justice.  Any adverse regulatory action, depending on its magnitude, may restrict us from effectively manufacturing, marketing and selling our products and could have a material adverse effect on our business, financial condition and results of operations.

Other Contingencies

Contractual obligations: We have entered into development, distribution and other contractual arrangements that may result in future payments dependent upon various events such as the achievement of certain product R&D milestones, sales milestones, or, at our discretion, maintenance of exclusive rights to distribute a product.  Since there is uncertainty on the timing or whether such payments will have to be made, they have not been recognized on our condensed consolidated balance sheets.  These estimated payments could range from $0 to approximately $380 million.

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

The following discussion and analysis should be read in conjunction with the interim condensed consolidated financial statements and corresponding notes included elsewhere in this Form 10-Q.  Certain percentages presented in this discussion and analysis are calculated from the underlying whole-dollar amounts and, therefore, may not recalculate from the rounded numbers used for disclosure purposes.

On February 5, 2021, we announced our intention to pursue a plan to spin off our Spine and Dental businesses to form SpinCo.  We are targeting completion of the spin-off by mid-2022, subject to the satisfaction of certain conditions, including, among others, final approval of our Board of Directors, receipt of a favorable opinion and IRS ruling with respect to the tax-free nature of the transaction, obtaining debt financing for the new company, and the effectiveness of a Form 10 registration statement with the SEC.  The following discussion and analysis includes these businesses in our discussion of financial condition and results of operations.

Executive Level Overview

Impact of the COVID-19 Global Pandemic

Our results have been significantly impacted by the COVID-19 global pandemic.  The vast majority of our net sales are derived from products used in elective surgical procedures.  As COVID-19 rapidly started to spread throughout the world in early 2020, our net sales decreased dramatically as countries took precautions to prevent the spread of the virus with lockdowns and stay-at-home measures and as hospitals deferred elective surgical procedures.  Although challenges related to COVID-19 continued in the first half of 2021, we saw signs of improvement from the first quarter to the second quarter in all regions and product categories as vaccine adoption continued globally.  The deferral of elective surgical procedures was most prevalent in the second quarter of 2020.  Therefore, we realized a substantial year-over-year net sales increase of 65.3 percent in the three-month period ended June 30, 2021 when compared to the same prior year period. We are currently seeing COVID-19 cases rising in a number of geographies due to slowing vaccination rates as well as the highly transmissible Delta variant.  Accordingly, COVID-19 may continue to have a significant impact on our operating results.    

Results for the Three and Six-Month Periods ended June 30, 2021

Our net sales increased by 65.3 percent and 28.7 percent in the three and six-month periods ended June 30, 2021, respectively, compared to the same prior year periods primarily due to the deferral of elective surgical procedures in 2020.  We saw continued improvement in elective surgical procedures in all regions and product categories as vaccine adoption continued globally, however elective procedures continued to be negatively impacted in the second quarter of 2021 due to COVID-19.  Our net earnings were $141.9 million and $340.0 million in the three and six-month periods ended June 30, 2021, respectively, compared to net losses of $206.6 million and $715.1 million in the same prior year periods, respectively.  We returned to profitability in the 2021 periods due to the recovery of elective surgical procedures as well as a reduction in operating expenses including goodwill and intangible asset impairment charges, certain fixed overhead and hourly production worker labor expenses and litigation.  In the three and six-month periods ended June 30, 2020, we recognized $33.0 million and $645.0 million of goodwill and intangible asset impairment charges, respectively, primarily due to the forecasted impact of COVID-19 on our operating results.  In the second quarter of 2020, we also temporarily suspended or limited production at certain manufacturing facilities, resulting in additional expense recognized in cost of products sold that related to certain fixed overhead costs and hourly production worker labor expenses that are included in the cost of inventory when these facilities are operating at normal capacity, which they were in the 2021 periods.  Lastly, in the six-month period ended June 30, 2020, we recognized net litigation-related charges of $81.1 million compared to $9.7 million in the same 2021 period.

2021 Outlook

The recovery of elective surgical procedures is continuing to take hold, as seen in the second quarter, but is playing out more slowly than we previously anticipated.  Furthermore, we are seeing COVID-19 cases rising in a number of geographies due to slowing vaccination rates as well as the highly transmissible Delta variant.  While we do not expect to return to the level of deferred surgical procedures experienced in 2020, the recovery could vary by region which increases uncertainty for us in the second half of 2021.  Since the clinical need for many of our products does not go away, we believe some patients will return for these surgical procedures, but exactly how quickly that occurs continues to be uncertain.  In the second half of 2021, we plan to continue our investments in research and development (“R&D”) and key commercial initiatives as we prepare for the recovery of elective surgical procedures.

Results of Operations

We analyze sales by three geographies, the Americas, EMEA and Asia Pacific, and by the following product categories: Knees; Hips; S.E.T.; Dental & Spine; and Other.  This sales analysis differs from our reportable operating segments, which are based upon our senior management organizational structure and how we allocate resources toward achieving operating profit goals.  We analyze

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sales by geography because the underlying market trends in any particular geography tend to be similar across product categories and because we primarily sell the same products in all geographies.  Our business is seasonal in nature to some extent, as many of our products are used in elective surgical procedures, which typically decline during the summer months and can increase at the end of the year once annual deductibles have been met on health insurance plans.  In 2021, it is uncertain if this seasonal pattern will be similar to years prior to 2020, due to COVID-19 and its continued impacts.

Net Sales by Geography

The following tables present our net sales by geography and the components of the percentage changes (dollars in millions):

	Three Months Ended
	June 30,							Volume /							Foreign
	2021		2020		% Inc			Mix			Price				Exchange
Americas	$	1,239.6	$	733.7		69.0	%		70.0	%		(1.7	)	%		0.7	%
EMEA		429.8		218.7		96.4			80.5			-				15.9
Asia Pacific		357.5		273.7		30.6			26.3			(1.9	)			6.2
Total	$	2,026.9	$	1,226.1		65.3			62.2			(1.5	)			4.6
	Six Months Ended
	June 30,							Volume /							Foreign
	2021		2020		% Inc			Mix			Price				Exchange
Americas	$	2,354.6	$	1,835.0		28.3	%		30.0	%		(2.1	)	%		0.4	%
EMEA		814.0		616.8		32.0			22.1			(0.2	)			10.1
Asia Pacific		705.7		558.1		26.4			21.3			(1.4	)			6.5
Total	$	3,874.3	$	3,009.9		28.7			26.8			(1.6	)			3.5

“Foreign Exchange,” as used in the tables in this report, represents the effect of changes in foreign currency exchange rates on sales.  

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Net Sales by Product Category

The following tables present our net sales by product category and the components of the percentage changes (dollars in millions):

	Three Months Ended
	June 30,							Volume /							Foreign
	2021		2020		% Inc			Mix			Price				Exchange
Knees	$	665.6	$	375.0		77.5	%		74.3	%		(2.1	)	%		5.3	%
Hips		474.6		329.7		44.0			42.4			(2.5	)			4.1
S.E.T.		462.1		292.7		57.9			52.3			0.7				4.9
Dental & Spine		263.5		152.3		73.1			70.3			(0.9	)			3.7
Other		161.1		76.4		110.9			109.3			(3.4	)			5.0
Total	$	2,026.9	$	1,226.1		65.3			62.2			(1.5	)			4.6
	Six Months Ended
	June 30,							Volume /							Foreign
	2021		2020		% Inc			Mix			Price				Exchange
Knees	$	1,279.9	$	1,003.7		27.5	%		25.9	%		(2.2	)	%		3.8	%
Hips		921.6		762.3		20.9			20.0			(2.6	)			3.5
S.E.T.		879.7		673.6		30.6			26.8			0.3				3.5
Dental & Spine		509.5		371.8		37.1			35.1			(1.0	)			3.0
Other		283.6		198.5		42.9			41.1			(1.9	)			3.7
Total	$	3,874.3	$	3,009.9		28.7			26.8			(1.6	)			3.5

The following table presents our net sales by geography for our Knees and Hips product categories, which represent our most significant product categories (dollars in millions):  

	Three Months Ended June 30,							Six Months Ended June 30,
	2021		2020		% Inc			2021		2020		% (Dec)
Knees
Americas	$	400.3	$	220.7		81.4	%	$	759.1	$	598.8		26.8	%
EMEA		148.6		65.4		127.2			279.9		218.1		28.4
Asia Pacific		116.7		88.9		31.2			240.9		186.8		29.0
Total	$	665.6	$	375.0		77.5		$	1,279.9	$	1,003.7		27.5
Hips
Americas	$	258.1	$	170.7		51.3	%	$	493.3	$	403.2		22.4	%
EMEA		122.5		70.8		72.8			230.2		182.2		26.3
Asia Pacific		94.0		88.2		6.6			198.1		176.9		12.0
Total	$	474.6	$	329.7		44.0		$	921.6	$	762.3		20.9

Demand (Volume and Mix) Trends  

Changes in volume and mix of product sales had a positive effect of 62.2 percent and 26.8 percent on year-over-year sales during the three and six-month periods ended June 30, 2021, respectively.  With continued vaccine adoption globally, we saw improved levels of recovery in elective surgical procedures in the second quarter.

Based upon country dynamics, volume changes varied by region.  In the Americas, we continued to see variability by country.  The U.S. continues to recover while Canada and Latin America saw significant recovery as those locations experienced higher levels of deferred elective surgical procedures in the second quarter of 2020.  In EMEA, we saw improvement throughout the second quarter of 2021, but towards the end of the quarter that improvement was tempered by slowing vaccination rates and increasing infection rates in several countries in the region.  Asia Pacific net sales growth in the second quarter of 2021 was lower than our other regions as its

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second quarter of 2020 was not as negatively impacted by COVID-19 as our other geographies.  We saw slowing recovery at the end of the second quarter of 2021 due to a resurgence of COVID-19 in a number of markets, including Japan.  Additionally, China sales were negatively affected in the second quarter of 2021 by channel inventory contraction in Knees and Hips in advance of the volume-based procurement (“VBP”) process to be implemented by its government.  The VBP process is expected to take effect in early 2022 so we expect a continued, modest impact on Asia Pacific Knees and Hips sales in the second half of 2021.

Pricing Trends

Global selling prices had a negative effect of 1.5 percent and 1.6 percent on year-over-year sales during the three and six-month periods ended June 30, 2021, respectively.  The majority of countries in which we operate continue to experience pricing pressure from governmental healthcare cost containment efforts and from local hospitals and health systems.  

Foreign Currency Exchange Rates

For the three and six-month periods ended June 30, 2021, changes in foreign currency exchange rates had a positive effect of 4.6 percent and 3.5 percent on year-over-year sales, respectively.  If foreign currency exchange rates remain at levels consistent with recent rates, we estimate there will be a positive impact of approximately 1.5 percent on full-year 2021 sales.  

Expenses as a Percentage of Net Sales

	Three Months Ended											Six Months Ended
	June 30,							% Inc /				June 30,							% Inc /
	2021			2020				(Dec)				2021			2020				(Dec)
Cost of products sold, excluding intangible asset amortization		28.7	%		34.6		%		(5.9	)	%		28.3	%		30.3		%		(2.0	)	%
Intangible asset amortization		7.6			12.0				(4.4	)			8.0			9.8				(1.8	)
Research and development		8.9			7.2				1.7				7.1			6.2				0.9
Selling, general and administrative		40.3			54.2				(13.9	)			41.0			49.6				(8.6	)
Goodwill and intangible asset impairment		0.8			2.7				(1.9	)			0.4			21.4				(21.0	)
Restructuring and other cost reduction initiatives		1.0			2.3				(1.3	)			1.1			2.4				(1.3	)
Quality remediation		0.5			0.8				(0.3	)			0.5			0.9				(0.4	)
Acquisition, integration, divestiture and related		1.3			0.2				1.1				1.0			0.2				0.8
Operating profit (loss)		10.9			(14.0	)			24.9				12.5			(20.9	)			33.4

The decrease in cost of products sold as a percentage of net sales for the three and six-month periods ended June 30, 2021 compared to the same prior year periods was primarily due to the significant increase in our net sales in 20221.  In addition, we are operating our manufacturing facilities within a range of normal capacity in the current year periods compared to the 2020 periods when we temporarily suspended or limited production at certain manufacturing facilities, resulting in additional expense recognized in cost of products sold that related to certain fixed overhead costs and hourly production worker labor expenses.  Additionally, we recognized lower excess and obsolete charges in the 2021 periods.  These favorable items were partially offset by hedge losses recognized in the current year periods as part of our hedging program compared to hedge gains in the prior year periods, higher manufacturing costs and lower average selling prices.  

Intangible asset amortization expense increased in the three and six-month periods ended June 30, 2021 compared to the same prior year periods due to additional amortization from acquisitions made in the fourth quarter of 2020.  However, intangible asset amortization as a percentage of net sales decreased in the current year periods when compared to the same prior year periods as the increase in our net sales in 2021 significantly exceeded the amortization increase.

R&D expenses increased in both amount and as a percentage of net sales in the three and six-month periods ended June 30, 2021 compared to the same prior year periods.  The increase in expenses was primarily due to certain agreements we entered into to gain access to or acquire third-party in-process R&D projects that resulted in charges of $65.0 million in the 2021 periods.  Additionally, R&D expenses increased as we reengaged in R&D projects in the current year periods compared to 2020 when COVID-19 caused delays in project spending.

Selling, general and administrative (“SG&A”) expenses increased in the three and six-month periods ended June 30, 2021 when compared to the same prior year periods primarily due to higher variable selling and distribution costs from increased sales.  Additionally, performance-based compensation was higher in the current year periods as similar costs were reduced in the prior year

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periods due to the effect COVID-19 had on our operating results.  Also, in the three-month period ended June 30, 2021, travel and medical training and education costs increased over the same 2020 period as we have partially resumed these activities.  In the six-month period ended June 30, 2021, these increased costs were partially offset by lower litigation-related charges as we recognized $81.1 million in the six-month period ended June 30, 2020 compared to $9.7 million in the same 2021 period.  Despite the increase in SG&A expenses, SG&A as a percentage of net sales declined in the current year periods when compared to the same prior year periods as our SG&A expenses included many fixed costs that did not decline ratably with the significant decline in net sales in the 2020 periods.   

In the three and six-month periods ended June 30, 2021, we recognized an intangible asset impairment charge of $16.3 million.  In the three and six-month periods ended June 30, 2020, we recognized goodwill and intangible asset impairment charges of $33.0 million and $645.0 million, respectively, including charges of $470.0 million and $142.0 million related to our EMEA and Dental reporting units, respectively, in the first quarter of 2020.  For more information regarding these charges, see Note 8 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report.  

In December 2019, our Board of Directors approved, and we initiated, the 2019 Restructuring Plan with an overall objective of reducing costs to allow us to invest in higher priority growth opportunities.  We recognized expenses of $19.6 million and $41.4 million in the three and six-month periods ended June 30, 2021, respectively, compared to $28.0 million and $73.0 million in the three and six-month periods ended June 30, 2020, respectively, attributable to restructuring and other cost reduction initiatives, primarily related to employee termination benefits, distributor contract terminations, consulting and project management expenses associated with the 2019 Restructuring Plan.  For more information regarding these charges, see Note 4 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report.

We continue to incur quality remediation expenses to complete our remediation milestones that address inspectional observations on Form 483 and a Warning Letter issued by the FDA at our Warsaw North Campus facility, among other matters.  Acquisition, integration, divestiture and related expenses increased in the three and six-month periods ended June 30, 2021 compared to the same prior year periods due to consulting and other professional service expenses related to the planned spin-off of our Spine and Dental businesses and the acquisitions made in 2020.    

Other Income (Expense), Net, Interest Expense, Net, and Income Taxes

In the three and six-month periods ended June 30, 2021 our other income, net was higher than in the same prior year periods primarily due to lower foreign currency re-measurement losses and gains recognized from changes to the fair value of our equity investments in the 2021 periods.    

Interest expense, net, increased in the three and six-month periods ended June 30, 2021, compared to the same prior year periods, primarily due to lower net interest income from receive-fixed-rate, pay-fixed-rate cross-currency interest rate swaps designated as net investment hedges that matured in 2021.    

In the three and six-month periods ended June 30, 2021, our effective tax rate (“ETR”) was 18.0 percent and 13.8 percent, respectively, compared to 6.2 percent and 1.2 percent in the three and six-month periods ended June 30, 2020, respectively.  The 18.0 percent ETR in the three-month period ended June 30, 2021 was primarily due to our mix of earnings between U.S. and foreign locations.  The 13.8 percent ETR in the six-month period ended June 30, 2021, was the result of favorable discrete adjustments from the filing of Swiss tax returns and an excess tax benefit related to stock-based compensation.  The 6.2 percent ETR in the three-month period ended June 30, 2020, was the result of the mix of some of our jurisdictions recognizing earnings while others had losses. The 1.2 percent ETR in the six-month period ended June 30, 2020, was primarily due to the $612.0 million goodwill impairment charge, which resulted in a loss before taxes, but has no corresponding tax benefit, as well as the mix of earnings and losses among our jurisdictions.  Absent discrete tax events, we expect our future ETR will be lower than the U.S. corporate income tax rate of 21.0 percent due to our mix of earnings between U.S. and foreign locations, which have lower corporate income tax rates.  Our ETR in future periods could also potentially be impacted by: changes in our mix of pre-tax earnings; changes in tax rates, tax laws or their interpretation; the outcome of various federal, state and foreign audits; and the expiration of certain statutes of limitations.  Currently, we cannot reasonably estimate the impact of these items on our financial results.

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Segment Operating Profit

										Operating Profit (Loss) as a
	Net Sales				Operating Profit (Loss)					Percentage of Net Sales
	Three Months Ended				Three Months Ended					Three Months Ended
	June 30,				June 30,					June 30,
(dollars in millions)	2021		2020		2021		2020			2021			2020
Americas Orthopedics	$	1,058.3	$	626.5	$	445.4	$	203.7			42.1	%		32.5		%
EMEA		392.9		204.1		95.2		20.1			24.2			9.8
Asia Pacific		345.7		264.5		111.4		78.4			32.2			29.6
Americas Spine and Global Dental		230.0		131.0		40.1		(3.4	)		17.4			(2.6	)
										Operating Profit as a
	Net Sales				Operating Profit					Percentage of Net Sales
	Six Months Ended				Six Months Ended					Six Months Ended
	June 30,				June 30,					June 30,
(dollars in millions)	2021		2020		2021		2020			2021			2020
Americas Orthopedics	$	2,004.5	$	1,569.5	$	832.5	$	607.0			41.5	%		38.7		%
EMEA		742.0		575.4		181.5		128.9			24.5			22.4
Asia Pacific		682.6		540.4		231.7		171.0			33.9			31.6
Americas Spine and Global Dental		445.2		324.6		79.1		22.5			17.8			6.9

Similar to our consolidated results, all of our segments were adversely affected by COVID-19 in the 2020 periods.  In each of our segments, operating profit and operating profit as a percentage of net sales increased in the three and six-month periods ended June 30, 2021 compared to the same prior year periods due to the effect of fixed operating expenses that did not increase proportionally with higher net sales.

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Non-GAAP Operating Performance Measures

We use financial measures that differ from financial measures determined in accordance with GAAP to evaluate our operating performance.  These non-GAAP financial measures exclude, as applicable, certain inventory and manufacturing-related charges including charges to discontinue certain product lines; intangible asset amortization; goodwill and intangible asset impairment; restructuring and other cost reduction initiative expenses; quality remediation expenses; acquisition, integration, divestiture and related expenses; certain litigation gains and charges; expenses to establish initial compliance with the EU MDR; expenses related to certain R&D agreements; other charges; any related effects on our income tax provision associated with these items; the effect of Switzerland tax reform; other certain tax adjustments; and, with respect to earnings per share information, provide for the effect of dilutive shares assuming net earnings in a period of a reported net loss.  We use these non-GAAP financial measures internally to evaluate the performance of the business.  Additionally, we believe these non-GAAP measures provide meaningful incremental information to investors to consider when evaluating our performance.  We believe these measures offer the ability to make period-to-period comparisons that are not impacted by certain items that can cause dramatic changes in reported income but that do not impact the fundamentals of our operations.  The non-GAAP measures enable the evaluation of operating results and trend analysis by allowing a reader to better identify operating trends that may otherwise be masked or distorted by these types of items that are excluded from the non-GAAP measures.  In addition, adjusted diluted earnings per share is used as a performance metric in our incentive compensation programs.

The following are reconciliations from our GAAP net earnings (loss) and diluted earnings (loss) per share to our non-GAAP adjusted net earnings and non-GAAP adjusted diluted earnings per share (in millions, except per share amounts):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Net Earnings (Loss) of Zimmer Biomet Holdings, Inc.	$	141.9		$	(206.6	)	$	340.0		$	(715.1	)
Inventory and manufacturing-related charges(1)		7.9			1.4			2.0			2.0
Intangible asset amortization(2)		154.6			147.7			310.1			295.3
Goodwill and intangible asset impairment(3)		16.3			33.0			16.3			645.0
Restructuring and other cost reduction initiatives(4)		19.7			28.0			41.6			73.0
Quality remediation(5)		11.0			9.9			21.2			25.8
Acquisition, integration, divestiture and related(6)		25.4			2.2			38.8			6.6
Litigation(7)		3.6			1.3			9.7			81.1
European Union Medical Device Regulation(8)		10.6			6.1			17.5			17.1
Certain R&D agreements(9)		65.0			-			65.0			-
Other charges(10)		(7.5	)		7.3			(9.0	)		13.9
Taxes on above items(11)		(65.6	)		(23.5	)		(112.6	)		(93.7	)
Swiss tax reform(12)		15.4			(0.7	)		18.8			16.2
Other certain tax adjustments(13)		2.2			4.1			0.2			(3.1	)
Adjusted Net Earnings	$	400.5		$	10.2		$	759.6		$	364.1

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	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Diluted Earnings (Loss) Per Share	$	0.67		$	(1.00	)	$	1.62		$	(3.46	)
Inventory and manufacturing-related charges(1)		0.04			0.01			0.01			0.01
Intangible asset amortization(2)		0.73			0.71			1.47			1.43
Goodwill and intangible asset impairment(3)		0.08			0.16			0.08			3.12
Restructuring and other cost reduction initiatives(4)		0.10			0.14			0.20			0.35
Quality remediation(5)		0.05			0.05			0.10			0.12
Acquisition, integration, divestiture and related(6)		0.12			0.01			0.18			0.03
Litigation(7)		0.02			0.01			0.05			0.39
European Union Medical Device Regulation(8)		0.05			0.03			0.08			0.08
Certain R&D agreements(9)		0.31			-			0.31			-
Other charges(10)		(0.04	)		0.04			(0.04	)		0.07
Taxes on above items(11)		(0.31	)		(0.13	)		(0.54	)		(0.44	)
Swiss tax reform(12)		0.07			-			0.09			0.08
Other certain tax adjustments(13)		0.01			0.02			-			(0.02	)
Effect of dilutive shares assuming net earnings(14)		-			-			-			(0.01	)
Adjusted Diluted Earnings Per Share	$	1.90		$	0.05		$	3.61		$	1.75

⁽¹⁾ Inventory and manufacturing-related charges include excess and obsolete inventory charges on certain product lines we intend to discontinue, incremental cost of products sold from stepping up inventory to its fair value from its manufactured cost in business combination accounting and other inventory and manufacturing-related charges or gains.

⁽²⁾ We exclude intangible asset amortization from our non-GAAP financial measures because we internally assess our performance against our peers without this amortization.  Due to various levels of acquisitions among our peers, intangible asset amortization can vary significantly from company to company.

⁽³⁾ In the first quarter of 2020, we recognized goodwill impairment charges of $470.0 million and $142.0 million related to our EMEA and Dental reporting units, respectively. In the second quarters of 2021 and 2020, we recognized $16.3 million and $33.0 million, respectively, of in-process research and development (“IPR&D”) intangible asset impairments on certain IPR&D projects.

⁽⁴⁾ In December 2019, our Board of Directors approved, and we initiated, a new global restructuring program that includes a reorganization of key businesses and an overall effort to reduce costs in order to accelerate decision-making and focus the organization on priorities to drive growth.  Restructuring and other cost reduction initiatives also include other cost reduction initiatives that have the goal of reducing costs across the organization.

⁽⁵⁾ We are addressing inspectional observations on Form 483 and a Warning Letter issued by the FDA following its previous inspections of our Warsaw North Campus facility, among other matters.  This quality remediation has required us to devote significant financial resources and is for a discrete period of time.  The majority of the expenses are related to consultants who are helping us to update previous documents and redesign certain processes.

⁽⁶⁾ The acquisition, integration, divestiture and related gains and expenses we have excluded from our non-GAAP financial measures resulted from the planned spinoff of SpinCo and various acquisitions.

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⁽⁷⁾ We are involved in routine patent litigation, product liability litigation, commercial litigation and other various litigation matters.  We review litigation matters from both a qualitative and quantitative perspective to determine if excluding the losses or gains will provide our investors with useful incremental information.  Litigation matters can vary in their characteristics, frequency and significance to our operating results.  The litigation charges and gains excluded from our non-GAAP financial measures in the periods presented relate to product liability matters where we have received numerous claims on specific products, patent litigation and commercial litigation related to a common matter in multiple jurisdictions.  In regards to the product liability matters, due to the complexities involved and claims filed in multiple districts, the expenses associated with these matters are significant to our operating results.  Once the litigation matter has been excluded from our non-GAAP financial measures in a particular period, any additional expenses or gains from changes in estimates are also excluded, even if they are not significant, to ensure consistency in our non-GAAP financial measures from period-to-period.

⁽⁸⁾ The European Union Medical Device Regulation imposes significant additional premarket and postmarket requirements.  The new regulations provided a transition period until May 2021 for currently-approved medical devices to meet the additional requirements.  For certain devices, this transition period can be extended until May 2024.  We are excluding from our non-GAAP financial measures the incremental costs incurred to establish initial compliance with the regulations related to our currently-approved medical devices.  The incremental costs primarily include third-party consulting necessary to supplement our internal resources.

⁽⁹⁾ During the three and six-month periods ended June 30, 2021, we entered into certain agreements to gain access to or acquire third-party IPR&D projects.

⁽¹⁰⁾ We have incurred other various expenses from specific events or projects that we consider highly variable or that have a significant impact to our operating results that we have excluded from our non-GAAP measures.  These include costs related to legal entity, distribution and manufacturing optimization, including contract terminations, gains and losses from changes in fair value on our equity investments, as well as, in the 2020 period, our costs of complying with a Deferred Prosecution Agreement (“DPA”) with the U.S. government related to certain Foreign Corrupt Practices Act matters involving Biomet and certain of its subsidiaries, which DPA concluded in February 2021.  

⁽¹¹⁾ Represents the tax effects on the previously specified items.  The tax effect for the U.S. jurisdiction is calculated based on an effective rate considering federal and state taxes, as well as permanent items.  For jurisdictions outside the U.S., the tax effect is calculated based upon the statutory rates where the items were incurred.

⁽¹²⁾ We recognized a tax benefit related to TRAF in addition to an impact from certain restructuring transactions in Switzerland. Also included are tax adjustments relating to the ongoing impacts of tax only amortization resulting from TRAF as well as certain restructuring transactions in Switzerland.

⁽¹³⁾ Other certain tax adjustments relate to various discrete tax period adjustments.

⁽¹⁴⁾ Diluted share count used in Adjusted Diluted EPS:

	Three Months Ended		Six Months Ended
	June 30, 2020		June 30, 2020
Diluted shares		206.8		206.6
Dilutive shares assuming net earnings		1.0		1.4
Adjusted diluted shares		207.8		208.0

Liquidity and Capital Resources

The COVID-19 pandemic has had an adverse effect on our liquidity and capital resource needs, primarily driven by the reduction in net sales due to elective surgical procedure deferrals.  We have taken prudent measures in an effort to maintain an adequate financial profile and to have access to capital to fund the business during these unprecedented times.  These measures included reductions in discretionary spending such as travel, meetings and other project spend that can be delayed with limited long-term detriment to the business.  More recently, we have increased spending on travel, meetings and other projects, but not to the extent that existed prior to the pandemic as we continue to better utilize technology that has made travel less necessary.  

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As of June 30, 2021, we had $1,042.4 million in cash and cash equivalents.  In addition, we had $1.0 billion available to borrow under our September 2020 Revolving Facility that matures on September 17, 2021, and $1.5 billion available under our 2019 Multicurrency Revolving Facility that matures on November 1, 2024.  The terms of the 2019 Multicurrency Revolving Facility and the September 2020 Revolving Facility are described further in Note 10 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report.

We believe that cash flows from operations, our cash and cash equivalents on hand, and available borrowings under our revolving credit facilities will be sufficient to meet our ongoing liquidity requirements for at least the next twelve months.  At this time, we do not anticipate needing to borrow against our revolving credit facilities to fund our operations.  However, due to the continued uncertainties related to the COVID-19 pandemic, it is possible our needs may change.  Further, there can be no assurance that, if needed, we will be able to secure additional financing on terms favorable to us, if at all.

Sources of Liquidity

Cash flows provided by operating activities were $700.4 million in the six-month period ended June 30, 2021, compared to $398.1 million in the same prior year period.  The increase in cash flows from operating activities was primarily the result of higher earnings in the 2021 period.  

Cash flows used in investing activities were $232.2 million in the six-month period ended June 30, 2021, compared to $206.5 million in the same prior year period.  Instrument and property, plant and equipment additions reflected ongoing investments in our product portfolio and optimization of our manufacturing and logistics network.  Additionally, in the 2021 period we had portions of our cross-currency interest rate swaps designated as net investment hedges mature at a loss, which resulted in net investing outflows compared to the same prior year period when we had cash inflows based upon the terms of our swaps.

Cash flows used in financing activities were $224.1 million in the six-month period ended June 30, 2021, compared to $92.9 million in the same prior year period.  In the 2021 period, we paid the remaining $200.0 million on our Floating Rate Notes due 2021 which matured in the period.  In the 2020 period, we issued senior notes and received $1,497.1 million in proceeds, which were used to pay our $1,500.0 million senior notes at maturity on April 1, 2020.  

At June 30, 2021, we had outstanding debt of $7,852.5 million, of which $1,050.0 million was classified as current debt.  The current debt consists of our $300.0 million senior notes due November 30, 2021 and $750.0 million senior notes due April 1, 2022.  For the $300.0 million senior notes due November 30, 2021, we intend to exercise our early redemption option to pay the full amount on August 30, 2021 by utilizing cash on hand.  For the $750.0 million senior notes due April 1, 2022, we believe we can satisfy this debt obligation with cash generated from our operations, by issuing new debt, and/or by borrowing on our revolving credit facilities.  

For additional information on our debt, including types of debt, maturity dates, interest rates, debt covenants and available revolving credit facilities, see Note 10 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report.

We place our cash and cash equivalents in highly-rated financial institutions and limit the amount of credit exposure to any one entity.  We invest only in high-quality financial instruments in accordance with our internal investment policy.

As of June 30, 2021, $315.1 million of our cash and cash equivalents were held in jurisdictions outside of the U.S.  Of this amount, $79.4 million is denominated in U.S. Dollars and, therefore, bears no foreign currency translation risk.  The balance of these assets is denominated in currencies of the various countries where we operate.  We intend to repatriate at least $5.5 billion of unremitted earnings in future years.

Our concentrations of credit risks with respect to trade accounts receivable are limited due to the large number of customers and their dispersion across a number of geographic areas and by frequent monitoring of the creditworthiness of the customers to whom credit is granted in the normal course of business.  Substantially all of our trade receivables are concentrated in the public and private hospital and healthcare industry in the U.S. and internationally or with distributors or dealers who operate in international markets and, accordingly, are exposed to their respective business, economic and country-specific variables.  We have continued to collect on outstanding receivables throughout the pandemic.  However, we are closely monitoring the financial stability of our customers and the country-specific risks, including those customers in markets with hospitals sponsored by the government.

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In February and May 2021, our Board of Directors declared a quarterly cash dividend of $0.24 per share.  We expect to continue paying cash dividends on a quarterly basis; however, future dividends are subject to approval of the Board of Directors and may be adjusted as business needs or market conditions change.    

In February 2016, our Board of Directors authorized a new $1.0 billion share repurchase program effective March 1, 2016, with no expiration date.  The previous program expired on February 29, 2016.  As of June 30, 2021, all $1.0 billion remained authorized.  

As discussed in Note 4 to our interim condensed consolidated financial statements in Part I, Item 1 of this report, in December 2019, our Board of Directors approved, and we initiated, the 2019 Restructuring Plan with an objective of reducing costs to allow us to further invest in higher priority growth opportunities.  The 2019 Restructuring Plan is expected to result in total pre-tax restructuring charges of approximately $350 million to $400 million, with approximately $230 million of that total expected to be incurred by the end of 2021.  We expect to reduce gross annual pre-tax operating expenses by approximately $200 million to $300 million by the end of 2023 as program benefits under the 2019 Restructuring Plan are realized.

As discussed in Note 7 to our interim condensed consolidated financial statements in Part I, Item 1 of this report, we completed the acquisitions of A&E Medical Corporation and Relign Corp. in 2020.  These acquisitions included guaranteed deferred payments totaling $145.0 million that we are obligated to make in the second half of 2021.

As discussed in Note 14 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report, the IRS has issued proposed adjustments for years 2010 through 2012, as well as proposed adjustments for years 2013 through 2015, reallocating profits between certain of our U.S. and foreign subsidiaries.  We have disputed these proposed adjustments and intend to continue to vigorously defend our positions.  Although the ultimate timing for resolution of the disputed tax issues is uncertain, future payments may be significant to our operating cash flows.

As discussed in Note 17 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report, we are involved in various litigation matters with respect to which we expect to continue paying settlements over the next few years.  Additionally, we have entered into development, distribution and other contractual arrangements that may result in future payments dependent upon various events such as the achievement of certain product R&D milestones, sales milestones, or, at our discretion, maintenance of exclusive rights to distribute a product.  Since there is uncertainty on the timing or whether such payments will have to be made, they have not been recognized on our condensed consolidated balance sheets.  These estimated payments could range from $0 to approximately $380 million.

Recent Accounting Pronouncements

Information pertaining to recent accounting pronouncements can be found in Note 2 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report.

Critical Accounting Estimates

Our financial results are affected by the selection and application of accounting policies and methods.  There were no changes in the three or six-month period ended June 30, 2021 to the application of critical accounting policies as described in our Annual Report on Form 10-K for the year ended December 31, 2020.  

Cautionary Note Regarding Forward-Looking Statements and Factors That May Affect Future Results

This quarterly report contains certain statements that are forward-looking statements within the meaning of federal securities laws.  Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts.  When used in this report, the words “may,” “will,” “can,” “should,” “would,” “could,” “anticipate,” “expect,” “plan,” “seek,” “believe,” “are confident that,” “predict,” “estimate,” “potential,” “project,” “target,” “forecast,” “intend,” “strategy,” “future,” “opportunity,” “assume,” “guide,” “position,” “continue” and similar expressions are intended to identify forward-looking statements.  Forward-looking statements are based on current beliefs, expectations and assumptions that are subject to significant risks, uncertainties and changes in circumstances that could cause actual results to differ materially from such forward-looking statements.  These risks, uncertainties and changes in circumstances include, but are not limited to:

• the effects of the COVID-19 global pandemic and other adverse public health developments on the global economy, our business and operations and the business and operations of our suppliers and customers, including the deferral of elective surgical procedures and our ability to collect accounts receivable, the failure of vaccine rollouts and other strategies to mitigate or reverse the impacts of the COVID-19 pandemic, and the failure of elective surgical procedures to recover at the levels or on the timeline anticipated;

• the risks and uncertainties related to our ability to successfully execute our restructuring plans;

41

• our ability to attract, retain and develop the highly skilled employees we need to support our business;

• the success of our quality and operational excellence initiatives, including ongoing quality remediation efforts at our Warsaw North Campus facility;

• the ability to remediate matters identified in inspectional observations or warning letters issued by the FDA, while continuing to satisfy the demand for our products;

• the risks and uncertainties associated with the proposed spin-off of our Spine and Dental businesses, including, without limitation, the significant expenses, time and efforts related to implementing such transaction, the ability to complete the transaction on our expected timeline or at all, the tax-free nature of the transaction, possible disruptions in our relationships with customers, suppliers and other business partners, and the possibility that the anticipated benefits and synergies of the transaction, strategic and competitive advantages of each company, and future growth and other opportunities for each company will not be realized within the expected time periods or at all;

• the impact of substantial indebtedness on our ability to service our debt obligations and/or refinance amounts outstanding under our debt obligations at maturity on terms favorable to us, or at all;

• the ability to retain the independent agents and distributors who market our products;

• dependence on a limited number of suppliers for key raw materials and outsourced activities;

• the possibility that the anticipated synergies and other benefits from mergers and acquisitions will not be realized, or will not be realized within the expected time periods;

• the risks and uncertainties related to our ability to successfully integrate the operations, products, employees and distributors of acquired companies;

• the effect of the potential disruption of management’s attention from ongoing business operations due to integration matters related to mergers and acquisitions;

• the effect of mergers and acquisitions on our relationships with customers, suppliers and lenders and on our operating results and businesses generally;

• challenges relating to changes in and compliance with governmental laws and regulations affecting our U.S. and international businesses, including regulations of the FDA and foreign government regulators, such as more stringent requirements for regulatory clearance of products;

• the outcome of government investigations;

• competition;

• pricing pressures;

• changes in customer demand for our products and services caused by demographic changes or other factors;

• the impact of healthcare reform measures;

• reductions in reimbursement levels by third-party payors and cost containment efforts sponsored by government agencies, legislative bodies, the private sector and healthcare purchasing organizations, including the volume-based procurement process in China;

• dependence on new product development, technological advances and innovation;

• shifts in the product category or regional sales mix of our products and services;

• supply and prices of raw materials and products;

• control of costs and expenses;

• the ability to obtain and maintain adequate intellectual property protection;

• breaches or failures of our information technology systems or products, including by cyber-attack, unauthorized access or theft;

• the ability to form and implement alliances;

• changes in tax obligations arising from tax reform measures, including European Union rules on state aid, or examinations by tax authorities;

• product liability, intellectual property and commercial litigation losses;

• changes in general industry and market conditions, including domestic and international growth rates;

42

• changes in general domestic and international economic conditions, including interest rate and currency exchange rate fluctuations; and

• the impact of the ongoing financial and political uncertainty on countries in EMEA on the ability to collect accounts receivable in affected countries.  

Our Annual Report on Form 10-K for the year ended December 31, 2020 and this report contain detailed discussions of these and other important factors under the heading “Risk Factors.” You should understand that it is not possible to predict or identify all factors that could cause actual results to differ materially from forward-looking statements.  Consequently, you should not consider any list or discussion of such factors to be a complete set of all potential risks or uncertainties.

Forward-looking statements speak only as of the date they are made and we expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Readers of this report are cautioned not to rely on these forward-looking statements since there can be no assurance that these forward-looking statements will prove to be accurate.  This cautionary statement is applicable to all forward-looking statements contained in this report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes from the information provided in our Annual Report on Form 10-K for the year ended December 31, 2020.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures.  We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”)) that are designed to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.  Because of inherent limitations, disclosure controls and procedures, no matter how well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of disclosure controls and procedures are met.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective at a reasonable assurance level.

Changes in Internal Control Over Financial Reporting.  There were no changes in our internal control over financial reporting that occurred during the quarter ended June 30, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  

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Part II – Other Information

Item 1. Legal Proceedings

Information pertaining to legal proceedings can be found in Note 17 to our interim condensed consolidated financial statements included in Part I, Item 1 of this report and is incorporated herein by reference.

Item 1A. Risk Factors

You should carefully consider the factors discussed in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2020 (“2020 Form 10-K”), which could materially affect our business, financial condition and results of operations.  Except has set forth below, there have been no material changes in those risk factors.  The risks described in our 2020 Form 10-K are not the only risks we face.  Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or results of operations.  In addition, the COVID-19 pandemic could exacerbate or trigger other risks discussed in our 2020 Form 10-K, any of which could materially affect our business, financial condition and results of operations.

The risk factor in our 2020 Form 10-K entitled “If third-party payors decline to reimburse our customers for our products or reduce reimbursement levels, the demand for our products may decline and our ability to sell our products profitably may be harmed” is replaced in its entirety by the following:

If third-party payors or key participants in government healthcare systems decline to reimburse our customers for our products or reduce reimbursement levels, the demand for our products may decline and our ability to sell our products profitably may be harmed.

We sell our products and services to hospitals, doctors, dentists and other healthcare providers, which receive reimbursement for the healthcare services provided to their patients from third-party payors, such as domestic and international government programs, private insurance plans and managed care programs.  These third-party payors may deny reimbursement if they determine that a product or service used in a procedure was not in accordance with cost-effective treatment methods, as determined by the third-party payor, or was used for an unapproved indication.  Third-party payors may also decline to reimburse for experimental procedures and products.

In addition, third-party payors are increasingly attempting to contain healthcare costs by limiting both coverage and the level of reimbursement for medical products and services.  If third-party payors reduce reimbursement levels or change reimbursement models for hospitals and other healthcare providers for our products, demand for our products may decline, or we may experience increased pressure to reduce the prices of our products, which could have a material adverse effect on our sales and results of operations.

We have also experienced downward pressure on product pricing and other effects of healthcare reform in our international markets.  For example, China has implemented a volume-based procurement process designed to decrease prices for medical devices and other products.  If key participants in government healthcare systems reduce the reimbursement levels for our products, including through political changes or transitions, our sales and results of operations may be adversely affected.

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

None

Item 3. Defaults Upon Senior Securities

None

Item 4. Mine Safety Disclosures

Not applicable

Item 5. Other Information

During the three-month period ended June 30, 2021, the Audit Committee of our Board of Directors approved the engagement of PricewaterhouseCoopers LLP, our independent registered public accounting firm, to perform certain non-audit services.  This disclosure is made pursuant to Section 10A(i)(2) of the Exchange Act, as added by Section 202 of the Sarbanes-Oxley Act of 2002.

44

Item 6. Exhibits

The following exhibits are filed or furnished as part of this report:

3.1	Certificate of Amendment of Restated Certificate of Incorporation of Zimmer Biomet Holdings, Inc., dated May 17, 2021 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed May 20, 2021)
3.2	Restated Certificate of Incorporation of Zimmer Biomet Holdings, Inc., dated May 17, 2021 (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed May 20, 2021)
3.3	Restated By-Laws of Zimmer Biomet Holdings, Inc., effective May 17, 2021 (incorporated by reference to Exhibit 3.3 to the Registrant’s Current Report on Form 8-K filed May 20, 2021)
10.1*	Zimmer Biomet Holdings, Inc. 2009 Stock Incentive Plan (As Amended on May 14, 2021) (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed May 20, 2021)
10.2*	Zimmer Biomet Holdings, Inc. Stock Plan for Non-Employee Directors (As Amended on May 14, 2021) (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed May 20, 2021)
10.3*	Zimmer Biomet Holdings, Inc. Deferred Compensation Plan for Non-Employee Directors (As Amended on May 14, 2021) (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed May 20, 2021)
10.4*	Swiss Employment Agreement by and between Zimmer GmbH and Wilfred van Zuilen dated as of May 5, 2021
10.5*	Offer Letter by and between Zimmer Biomet Holdings, Inc. and Wilfred van Zuilen dated as of May 5, 2021
10.6*	Form of Change in Control Severance Agreement with Wilfred van Zuilen
10.7*	Form of Confidentiality, Non-Competition and Non-Solicitation Agreement with Wilfred van Zuilen
10.8*	Form of Indemnification Agreement with Wilfred van Zuilen (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed July 31, 2008)
21	List of Subsidiaries of Zimmer Biomet Holdings, Inc.
31.1	Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 of the Chief Executive Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 of the Chief Financial Officer, as adopted 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
101 101.SCH 101.CAL 101.DEF 101.LAB 101.PRE	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. Inline XBRL Taxonomy Extension Schema Document Inline XBRL Taxonomy Extension Calculation Linkbase Document Inline XBRL Taxonomy Extension Definition Linkbase Document Inline XBRL Taxonomy Extension Label Linkbase Document Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*Management contract or compensatory plan or arrangement.

45

SIGNATURES

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.

	ZIMMER BIOMET HOLDINGS, INC.
	(Registrant)
Date:  August 3, 2021	By:	/s/ Suketu Upadhyay
		Suketu Upadhyay
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)
Date:  August 3, 2021	By:	/s/ Carrie Nichol
		Carrie Nichol
		Vice President, Controller and Chief Accounting Officer
		(Principal Accounting Officer)

46

EX-10.4

Exhibit 10.4

Zimmer GmbH

Zahlerweg 4

CH-6300 Zug

Phone +41 (0)58 854 90 00

www.zimmerbiomet.com

Employment Agreement

between

Zimmer GmbH

Zahlerweg 4, 6300 Zug

and

Mr. Wilfred van Zuilen

(hereinafter referred as “you” or “Mr.van Zuilen“)

will be hired in terms of Art. 319ff. OR.

1. Hire date, position and work location

1.1 Mr. van Zuilen will be employed effective June 1, 2021 as President EMEA, Level Z4. In this role, you will be responsible for all the Business divisions of Zimmer Biomet in EMEA, except for the Spine and Dental Businesses. This agreement is subject to issuance of the work permit by the cantonal authorities.

1.2 The position will be based in Zug, Switzerland.

2. Contract duration, probationary period and notice period

2.1 This Agreement shall be valid for an indefinite time period.

2.2 The probationary period shall be omitted. The employment may be terminated by either party with a notice period of 6 months from the end of the month in which the notice is given.

2.3 In this role, you will be eligible to participate in the company’s Executive Severance Plan, as amended. As an eligible Leadership Team member, in the event of your involuntary separation without Cause as defined under the plan, your severance benefit offer would include the sum of your final base salary and final target bonus. Payment would be made in lump-sum form, less applicable tax withholdings, subject to your entering into a general release in the form provided by the Company. There would be no duplication of benefits provided under the Change in Control (“CIC”) Severance Agreement or otherwise. Your continued eligibility for participation in this plan will be in accordance with terms of the plan as defined and administered by the company, and taking into account your then-current job Z-Grade, role and responsibilities in the company.

2.4 In your role, you will be eligible to receive a CIC Severance Agreement, subject to execution of the enclosed Confidentiality. Non-Competition and Non-Solicitation Agreement. The agreement would provide you with certain severance benefits following a change in control of Zimmer Biomet Holdings, Inc. and related terminating of your

Exhibit 10.4

employment. Once you return the Confidentiality, Non-Competition, and Non-Solicitation Agreement, we will prepare the CIC Severance Agreement along with a cover memo outlining the benefits under the agreement. Your continued eligibility for potential CIC severance benefits in the event of a change in control would be in accordance with terms of the agreement.

3. Salary and bonus

3.1 Your annual base salary amounts to CHF 520,000 gross. It will be paid in twelve monthly installments. Remittance is made at the end of each month via bank transfer to a Swiss Bank Account, taking into account the deductions applying.

3.2 You will be eligible to participate in the 2021 Executive Performance Incentive Plan (“EPIP”) upon your hire date. Your target bonus will be eighty percent (80%) of your eligible earnings (which will consist primarily of base salary payments) for the year. Pay-out will depend on actual year-end results for the established performance measures. Payment will occur in or around March of the year following the bonus period after annual performance measures upon which the bonus is based have been determined. You must remain employed by the Zimmer Biomet Group at the time of bonus pay out to receive the bonus.

You will participate in the 2021 EPIP based upon the corporate metric group and an individual bonus component. Your bonus will be determined based 90% on the corporate metric and 10% on evaluated accomplishment of your goals and objectives. Your 2021 bonus will be prorated for a partial year of service by applying the earned bonus percentage to your eligible Zimmer Biomet Group earnings for the year.

4. Long Term Incentive Plan (LTI) Plan Award

4.1 You will be eligible to be considered for participation in the Zimmer Biomet Holdings Inc. equity award program.

4.2 We anticipate that the Company’s 2022 LTI Plan grants will have two components:

- Stock options and

- Performance-based Restricted Stock Units (“PRSUs”)

The LTI structure currently offers participants a diversified award of 50% stock options and 50% PRSUs that can provide more consistent value than an award of stock options alone. Further, we believe this structure assists the Company in remaining competitive within the global labor market and creates a compelling and valuable long-term incentive for participants. For 2022, we anticipate two performance metrics for the PRSUs, and that pay-outs will be determined based 50% on the Company’s relative total shareholder return against the S&P 500 Health Care Index constituents and 50% on the Company’s constant currency revenue growth. We will provide additional details and information on this PRSU design in our around February 2022.

We will review the performance metrics, equity award types and value mix in conjunction with the 2022 annual grant and will communicate when the Compensation and Management Development Committee of the Company’s Board of Directors (“Compensation Committee”) has made these determinations. Thereafter, the applicable performance metrics, equity award types and value mix will be subject to annual review and approval by the Compensation Committee.

Exhibit 10.4

For 2022, your estimated LTI grant date fair value in this role will be approximately $1,300,000 (USD). We anticipate the grant date of the 2022 award will be in or around February 2022, subject to the Compensation Committee’s approval.

LTI grant values are based upon our compensation philosophy, which is reviewed annually by the Compensation Committee and adjusted as warranted. Please keep in mind that your job responsibilities, performance against your goals and objectives, the overall financial results of the Company and peer group / market compensation practices also impact LTI grant values each year. All eligible equity awards are made in USD.

All equity awards are subject to Compensation Committee approval and other terms and conditions of the 2009 Stock Incentive Plan, as amended from time to time, award agreements, and your execution of a non-compete agreement in the form provided by the Company.

5. Company Car and Cash-Car Allowance

5.1 You will be entitled for a company car or car allowance, according to the European Car Policy

6. Working time and holiday

6.1 Theworking hours result from the requirements of the function, and you will not be eligible for paid overtime or excess overtime, either in cash or time off. To compensate overtime, you will be entitled to 5 additional vacation days per calendar year.

6.2 The annual holiday entitlement is according to the Collective Employment Agreement of the Engineering Industry (hereinafter referred to as the “GAV”).

6.3 In case of incapacity due to illness, accident or the like to perform the employment duties required under this agreement, you shall notify the employer immediately and shall provide a medical certificate evidencing such incapacity as of the 4th day of such incapacity. However, the employer is free at any time to request a medical certificate from the first day of absence.

7. Apartment/Housing

7.1 The Company is offering you an apartment in Zug, Switzerland with the cost of the apartment to be covered by Zimmer Biomet.

7.2 All housing payments according to the policy rules may be taxable according to the Swiss law.

8. Pension plan

For pension purposes, you will be covered under the terms and conditions of the following scheme: “Sulzer Vorsorgeeinrichtung (SVE)” and Johann Jakob Sulzer Stiftung (JJS).

Exhibit 10.4

9. Confidentiality, Non-Competition, and Non-Solicitation Agreement

You commit to sign as an attachment to this agreement a Confidentiality, Non-Competition, and Non-Solicitation Agreement which shall apply throughout employment and for certain periods thereafter.

10. Applicable Law and Place of Jurisdiction

This agreement takes effect when signed by both parties. Employment is subject to Swiss Law and the GAV (to the extent applicable). The courts of law in the Canton of Zug have jurisdiction.

11. Contract supplement

11.1 You must treat all information acquired in the course of employment, which is not public knowledge, with absolute confidentiality. This obligation continues to apply after the employment relationship has ended.

The collection, supply and forwarding of information to third parties, as well as publications in word, text, image or sound in respect of technical matters and other issues concerning the company, require the express consent of the company.

11.2 The following documents form an integral part of this agreement, if not otherwise specified in this agreement:

• Collective Employment Agreement of the Engineering Industry (GAV)

• Employee Handbook (Arbeitsvertragliche Bestimmungen Zimmer, AVB)

• Swiss Working Time Regulation (Arbeitszeitreglement Schweiz)

• Terms and conditions of the “Sulzer Vorsorgeeinrichtung (SVE)” and terms Conditions of the “Johann Jakob Sulzer Stiftung (JJS)” Code of Business Conduct

• Confidentiality, Non-Competition, and Non-Solicitation Agreement

• Agreement of Waiver to Register Working Hours

• EEA and Switzerland Employee Privacy Policy and Notice

You acknowledge that you have read and understood the enclosed EEA and Switzerland Employee Privacy Policy and Notice.

11.3 In the event of any discrepancies between this agreement and the general contract terms, this agreement shall take precedence over the general contract terms.

Exhibit 10.4

You confirm the receipt of the above mentioned documents and your agreement with the contents.

Zug, May 5, 2021

Zimmer GmbH

/s/ Carole Maire

Carole Maire

VP, Human Resources EMEA

Agreed:

Place and Date: Woerden, May 6, 2021Employee:/s/ Wilfred van Zuilen

Wilfred van Zuilen

EX-10.5

Exhibit 10.5

Confidential

May 5, 2021

Wilfred van Zuilen

Dear Wilfred:

We are pleased to offer you the role of President, EMEA of Zimmer Biomet Holdings, Inc. (“Zimmer Biomet” or the “Company”) reporting to Ivan Tornos, Chief Operating Officer. Your salary grade will be level Z04.  We will mutually agree on your start date, which we expect to be on or around June 1, 2021. You will also be a member of the Company’s global Leadership Team.

This will be an addendum to your Swiss-based contract dated May 5, 2021.

Position Location

This position will be based in Zug, Switzerland.  Your tax home will be in Zug and business meetings and activities will occur in Zug.

Annual Merit Adjustment

Zimmer Biomet’s annual merit review process involves base pay adjustments consistent with job performance.  Merit adjustments are based on performance during the calendar year.  You will be eligible for a merit increase beginning in 2022  

Equity Replacement and Sign-On Grants

As described further below, in connection with your commencement of employment, Zimmer Biomet will provide you a one-time long-term incentive grant with a grant date fair value of approximately $3,260,000 (USD).

Equity Replacement Grant

Approximately $2,500,000 (USD) will consist of 50% time-vested restricted stock units (“RSUs”) and 50% stock options. The grant date will be the first business day of the month following your commencement of employment.  These RSUs and stock options will vest at the rate of 25% per year over four years beginning on the first anniversary of the grant date, assuming your continued employment with Zimmer Biomet. The stock options will expire on the tenth anniversary of the grant date.

Sign-On Equity Grant

Approximately $760,000 (USD) will consist of will consist of 50% time-vested RSUs and 50% stock options. The grant date will be the first business day of the month following your commencement of employment. These RSUs and stock options will vest at the rate of 25% per year over four years beginning on the first anniversary of the grant date, assuming your continued employment with Zimmer Biomet.  The stock options will expire on the tenth anniversary of the grant date.

Page 1 –

All equity awards are subject to Compensation and Management Development Committee (“Compensation Committee”) approval and other terms and conditions of the 2009 Stock Incentive Plan, as amended from time to time; award agreements; and your execution of a non-compete agreement in the form provided by the Company.

Executive Officer (Section 16)

We expect that you will be designated by the Board of Directors as an “officer” of Zimmer Biomet for purposes of Rule 16a-1(f) and as an “executive officer” for purposes of Rule 3b-7 under the Securities Exchange Act of 1934, as amended.  

As an executive officer, you will be subject to stock ownership guidelines established by the Board of Directors in order to align the interests of executive officers more closely with those of stockholders.  The guidelines will require you to own shares with a value equal to at least three (3) times your base salary.  Under the guidelines, all shares you hold, including time-based RSUs (but excluding unvested performance-based RSUs), will count toward this ownership requirement.  In addition, one-half of any gain on vested stock options will count toward this requirement.  You will have up to five (5) years to achieve the required level of stock ownership.  Further, every executive officer must obtain clearance prior to selling any shares of Company common stock, in part to ensure that all officers remain in compliance with the stock ownership guidelines.

Contractual Obligations

It is our understanding that you do not have any contractual obligations (such as a non-competition or non-solicitation agreement) with a former or current employer that you would violate by accepting this role.  If our understanding is incorrect, please notify me immediately.  If you have a confidentiality obligation with a former or current employer, it is your responsibility to refrain from using or disclosing confidential information.  If you have any questions about this responsibility, please let us know.

Section 409A

To the extent that any payments or benefits under this letter are deemed to be subject to Section 409A of the Internal Revenue Code of 1986, as amended (“Code”), this letter will be interpreted in accordance with Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder in order to (a) preserve the intended tax treatment of the benefits provided with respect to such payments and (b) comply with the requirements of Section 409A of the Code. A termination of employment shall not be deemed to have occurred for purposes of any provision of this letter providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Section 409A. Nothing in this letter shall be construed as a guarantee by the Company of any particular tax effect. The Company shall not be liable to you for any tax, penalty, or interest imposed on any amount paid or payable hereunder by reason of Section 409A, or for reporting in good faith any payment made under this letter as an amount includible in gross income under Section 409A.

Page 2 –

If there is any discrepancy between this letter and/or the Swiss contract and the plan documents, the plan documents will govern. While Zimmer Biomet intends to continue benefits referenced in this offer, we reserve the right to change or discontinue them at any time for any reason.Please note in particular that any amount payable or paid to you pursuant to any performance-based compensation plan may be subject to forfeiture or repayment in accordance with the Company’s Executive Compensation Recoupment Policy or applicable plan document or award agreement as approved, adopted and/or revised by the Board or Compensation Committee from time to time, and/or subject to recoupment as required by any other provisions of any law (including, without limitation, Section 10D of the Securities Exchange Act of 1934, as amended), governmental regulation or stock exchange listing requirement.  By signing below, you acknowledge your understanding that any such repayment obligation will apply notwithstanding anything else stated in this letter.

We are very excited to have you join us and are looking forward to receiving your signed offer letter.  We believe you will make a valuable contribution and find your career with Zimmer Biomet challenging and rewarding.

CONFIRMATION OF ACCEPTANCE

Please indicate your acceptance of this offer by signing below and returning the signed letter to me.  

Sincerely,

Ivan Tornos

Chief Operating Officer

Accepted:

/s/ Wilfred van Zuilen  May 6, 2021

__________________________________________

Wilfred van Zuilen       Date

Page 3 –

EX-10.6

Exhibit 10.6

Change in Control Severance Agreement

This Change in Control Severance Agreement ("Agreement") is made by and between Zimmer GmbH ("Employer" or "Company" as case may be) and Wilfred van Zuilen ("Executive").

Recitals

(A) The Company considers it essential to the best interests of its ultimate shareholders to foster the continuous employment of key management personnel.

(B) The Company and the Board recognize that, as is the case with many publicly held corporations, the possibility of a Change in Control in the Ultimate Parent Company exists and that such a possibility, and the uncertainty and questions that it may raise among management, may result in the departure or distraction of management personnel to the detriment of the Company and its shareholders.

(C) The Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of members of the Company's management, including the Executive, to their assigned duties without distraction in the face of potentially disturbing circumstances arising from the possibility of a Change in Control.  

(D) The parties intend that no amount or benefit will be payable under this Agreement unless a termination of the Executive's employment with the Company occurs following a Change in Control, or is deemed to have occurred following a Change in Control, as provided in this Agreement.

Defined terms as used herein and not defined elsewhere in this Agreement, shall have the meaning ascribed to them in Annex 1 to this Agreement.

1. Term of Agreement

This Agreement will commence on the date stated below and will continue in effect through December 31, 2021.  Beginning on January 1, 2022, and each subsequent January 1, the term of this Agreement will automatically be extended for one additional year, unless either party gives the other party written notice not to extend this Agreement at least 30 days before the extension would otherwise become effective or unless a Change in Control occurs.  If a Change in Control occurs during

	2 / 11
Change in Control Severance Agreement

the term of this Agreement, this Agreement will continue in effect for a period of 24 months from the end of the month in which the Change in Control occurs.  Notwithstanding the foregoing provisions of this Article, this Agreement will terminate on the Executive's retirement date, as defined under Swiss law.

2. Compensation other than Severance Payments

2.1 Compensation Previously Earned

If the Executive's employment is terminated for any reason following a Change in Control and during the term of this Agreement, the Company will pay the Executive's salary accrued through the Date of Termination, at the rate in effect at the time the Notice of Termination is given, together with all other compensation and benefits payable to the Executive through the Date of Termination under the terms of any compensation or benefit plan, program, or arrangement maintained by the Company during that period.

2.2 Normal Post-Termination Compensation and Benefits.

Except as provided in Section 3.1, if the Executive's employment is terminated for any reason following a Change in Control and during the term of this Agreement, the Company will pay the Executive the normal compensation and benefits payable to the Executive under the terms of the Company's compensation or benefit plans, programs, and arrangements, as in effect immediately prior to the Change in Control, including but not limited to the Non-Competition Period Payments (if any). This provision does not restrict the Company's right to amend, modify, or terminate any plan, program, or arrangement prior to a Change in Control.

2.3 No Duplication.

Notwithstanding any other provision of this Agreement to the contrary, the Executive will not be entitled to duplicate benefits or compensation under this Agreement and the terms of any other plan, program, or arrangement maintained by the Company or any affiliate.

3. Severance Payments

3.1 Payment Triggers

In addition to the payments as set out in Section 2 above, but in lieu of any other severance compensation or benefits to which the Executive may otherwise be entitled under any plan, program, policy, or arrangement of the Company or by law in particular due to abusive termination under Art. 336a Swiss Code of Obligations (and which the Executive hereby expressly waives), the Company will pay the Executive the Severance Payments described in Section 3.2 upon termination of the Executive's

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Change in Control Severance Agreement

employment following a Change in Control and during the term of this Agreement, unless the termination is (1) by the Company for Cause, (2) by reason of the Executive's death, or (3) by the Executive without Good Reason.

For purposes of this Section 3.1, the Executive's employment will be deemed to have been terminated following a Change in Control by the Company without Cause or by the Executive with Good Reason if (1) the Executive's employment is terminated without Cause prior to a Change in Control at the direction of a Person who has entered into an agreement with the Ultimate Parent Company, the consummation of which will constitute a Change in Control; or (2) the Executive terminates his employment with Good Reason prior to a Change in Control (determined by treating a Potential Change in Control as a Change in Control in applying the definition of Good Reason), if the circumstance or event that constitutes Good Reason occurs at the direction of such a Person.

The Severance Payments described in this Article 3 are subject to the conditions stated in Section 4 below and shall be reduced in part or in their totality if and to the extent the Severance Payments were, at the time of their payment, to be deemed a golden parachute or similar arrangement prohibited under the laws where the Company is incorporated and has its registered office or the costs associated with the Severance Payments could no longer be booked as expenditures in the Company's profit and loss statement.

3.2 Severance Payments.

The following are the Severance Payments referenced in Section 3.1:

(a) Lump Sum Severance Payment

In lieu of any further salary payments to the Executive for periods after the Date of Termination, and in lieu of any severance benefits otherwise payable to the Executive, the Company will pay to the Executive, in accordance with Section 3.3, a lump sum severance payment, in cash, equal to (a) two times the sum of (1) the higher of the Executive's annual base salary in effect immediately prior to the event or circumstance upon which the Notice of Termination is based or in effect immediately prior to the Change in Control, plus (2) the amount of the Executive's target annual bonus entitlement under the Cash Incentive Plan (or any other bonus plan of the Company then in effect) as in effect immediately prior to the event or circumstance giving rise to the Notice of Termination, less (b) the amount of any statutory payment to which the Executive is entitled related to any statutory notice period. If the Board determines that it is not workable to determine the amount that the Executive's target bonus would have been for the year in which the Notice of Termination was given, then, for purposes of this paragraph (a), the Executive's target annual bonus entitlement will be the average of annual bonus paid to the Executive with respect to the three years immediately prior to the year in which the Notice of Termination was given.

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Change in Control Severance Agreement

(b) Options and Restricted Shares

All outstanding Options will become immediately vested and exercisable (to the extent not yet vested and exercisable as of the Date of Termination).  To the extent not otherwise provided under the written agreement evidencing the grant of any restricted Shares to the Executive, all outstanding Shares that have been granted to the Executive subject to restrictions that, as of the Date of Termination, have not yet lapsed will lapse automatically upon the Date of Termination, and the Executive will own those Shares free and clear of all such restrictions.  Notwithstanding the foregoing, Options and restricted Shares remain subject to any forfeiture or clawback claims under the applicable option plan or award agreement.

3.3 Time of Payment

Except as otherwise expressly provided in Section 3.2, payments provided for in that Section will be made as follows:

No later than the fifth business day following the Date of Termination, the Company will pay to the Executive an estimate, as determined by the Company in good faith, of 90% of the payments under Section 3.2 (a) to which the Executive is clearly entitled.

The Company will pay to the Executive the remainder of the payments due to the Executive under Section 3.2 not later than 90 business days after the Date of Termination.

At the time that payment is made under this Section 3.3, the Company will provide the Executive with a written statement setting forth the manner in which all of the payments to him under this Agreement were calculated and the basis for the calculations.

3.4 Outplacement Services

For a period not to exceed six (6) months following the Date of Termination, the Company will provide the Executive with reasonable outplacement services consistent with past practices of the Company prior to the Change in Control or, if no past practice has been established prior to the Change in Control, consistent with the prevailing practice in the medical device manufacturing industry.

4. The Executive's Covenants

4.1 Confidentiality, Non-Competition and Non-Solicitation Agreement

The Executive herewith acknowledges and affirms his continuing obligations under the existing Confidentiality, Non-Competition and Non-Solicitation Agreement dated 6 May 2021 and re-affirms his agreement to honor the obligations as set forth

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Change in Control Severance Agreement

therein.

4.2 General Release

The Executive agrees that, notwithstanding any other provision of this Agreement, the Executive will not be eligible for any Severance Payments under this Agreement unless the Executive timely signs a General Release in substantially the form attached to this Agreement as Annex 2.  The Executive will be given 30 days to consider the terms of the General Release. If the Executive does not return the executed General Release to the Company by the end of the 30 day period that failure will be deemed a refusal to sign, and the Executive will not be entitled to receive any Severance Payments under this Agreement.

5. Notices

For the purpose of this Agreement, notices and all other communications provided for in the Agreement will be in writing and will be deemed to have been duly given when delivered or mailed by Swiss registered mail, return receipt requested, addressed to the respective addresses set forth below, or to such other address as either party may furnish to the other in writing in accordance with this Article 5, except that notice of change of address will be effective only upon actual receipt:

To the Company:

Zimmer GmbH.

Attention: Vice President EMEA Counsel

Zählerweg 4

6300 Zug

To the Executive:

The Executive’s principal residence as reflected in the records of the Company.

6. Miscellaneous

This Agreement constitutes and expresses the entire agreement between the Parties pertaining to the subject matter contained herein and supersedes all prior and contemporaneous oral or written agreements, representations, understandings and the like between the Parties.

This Agreement may not be modified, amended, altered or supplemented, in whole or in part, except by a written agreement signed by the Parties.

If any provision of this Agreement is found by any competent authority to be void, invalid or unenforceable, such provision shall be deemed to be deleted from this Agreement and the remaining provisions of this Agreement shall continue in full

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Change in Control Severance Agreement

force. In this event, the Agreement shall be construed, and, if necessary, amended in a way to give effect to, or to approximate, or to achieve a result which is as close as legally possible to the result intended by the provision hereof determined to be void, illegal or unenforceable.

7. Governing Law and Jurisdiction

This Agreement shall be governed by, interpreted and construed in accordance with the substantive laws of Switzerland.

The ordinary courts and at the registered office of the Company shall have exclusive jurisdiction for all disputes arising out of or in connection with this Agreement.

This Agreement enters into force effective as of May 5, 2021.

Zimmer GmbH

/s/ Guillaume Génin/s/ Carole Maire

Guillaume GéninCarole Maire

Vice President EMEA Counsel Vice President Human Resources EMEA

Executive

/s/ Wilfred van Zuilen

Wilfred van Zuilen

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Change in Control Severance Agreement

Annex 1: Definitions

"Beneficial Owner" has the meaning stated in Rule 13d‑3 under the Exchange Act.

"Board" means the Board of Directors of the Ultimate Parent Company.

"Cash Incentive Plan" means the Ultimate Parent Company’s Executive Performance Incentive Plan.

"Cause" for termination by the Company of the Executive's employment, after any Change in Control, means (1) any reason being deemed good reason in the sense of Art. 336d Swiss Code of Obligations; (2) the willful and continued failure by the Executive to substantially perform the Executive's duties with the Company (other than any such failure resulting from the Executive's incapacity due to physical or mental illness or any such actual or anticipated failure after the issuance of a Notice of Termination for Good Reason by the Executive) for a period of at least 10 consecutive days after a written demand for substantial performance is delivered to the Executive by the Company, which demand specifically identifies the manner in which the Company believes that the Executive has not substantially performed the Executive's duties; or (3) the Executive willfully engages in conduct that is demonstrably and materially injurious to the Company, the Ultimate Parent Company or its subsidiaries, monetarily or otherwise.

A "Change in Control" will be deemed to have occurred if any of the following events occur:

(a) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Ultimate Parent Company (not including in the securities beneficially owned by that Person any securities acquired directly from the Ultimate Parent Company or its affiliates) representing 20% or more of the combined voting power of the Ultimate Parent Company's then outstanding securities; or

(b) during any period of two consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of the period constitute the Board and any new director (other than a director designated by a Person who has entered into an agreement with the Ultimate Parent Company to effect a transaction described in clause (a), (c) or (d) of this paragraph whose election by the Board or nomination for election by the Ultimate Parent Company's stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously approved), cease for any reason to constitute a majority of the Board; or

(c) the shareholders of the Ultimate Parent Company approve a merger or consolidation of the Ultimate Parent Company with any other corporation, other than (A) a merger or consolidation that would result in the voting securities of

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Change in Control Severance Agreement

the Ultimate Parent Company outstanding immediately prior to the merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Ultimate Parent Company, at least 75% of the combined voting power of the voting securities of the Ultimate Parent Company or the surviving entity outstanding immediately after the merger or consolidation; or (B) a merger or consolidation effected to implement a recapitalization of the Ultimate Parent Company (or similar transaction) in which no Person acquires more than 50% of the combined voting power of the Ultimate Parent Company's then outstanding securities; or

(d) the shareholders of the Ultimate Parent Company approve a plan of complete liquidation of the Ultimate Parent Company or an agreement for the sale or disposition by the Ultimate Parent Company of all or substantially all the Ultimate Parent Company's assets.

Notwithstanding the foregoing, a Change in Control will not include any event, circumstance, or transaction occurring during the six-month period following a Potential Change in Control that results from the action of any entity or group that includes, is affiliated with, or is wholly or partly controlled by the Executive; provided, further, that such an action will not be taken into account for this purpose if it occurs within a six-month period following a Potential Change in Control resulting from the action of any entity or group that does not include the Executive.

"Date of Termination" means the date on which the Notice of Termination under the Employment Agreement has lapsed.

"Employment Agreement" means the employment agreement between the Executive and the Company dated 6 May 2021 as further modified.

"Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended from time to time, and interpretive rules and regulations.

"Good Reason" for termination by the Executive of the Executive's employment means the occurrence (without the Executive's express written consent) of any one of the following acts by the Company, or failures by the Company to act following a Change in Control:

(a) the assignment to the Executive of any duties inconsistent with the Executive's status as an executive officer of the Company or a substantial adverse alteration in the nature or status of the Executive's responsibilities from those in effect immediately prior to a Change in Control;

(b) the Company's failure, without the Executive's consent, to pay to the Executive any portion of the Executive's current compensation (which means, for purposes of this paragraph (b), the Executive's annual base salary as in effect on the date

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Change in Control Severance Agreement

of this Agreement, or as it may be increased from time to time, and the awards earned pursuant to the Cash Incentive Plan) or to pay to the Executive any portion of an installment of deferred compensation under any deferred compensation program of the Company, within 30 days of the date the compensation is due;

(c) the Company's failure to continue in effect any compensation plan in which the Executive participates immediately prior to a Change in Control, which plan is material to the Executive's total compensation, including, but not limited to, the Cash Incentive Plan and the Ultimate Parent Company’s 2009 Stock Incentive Plan as amended from time to time or any substitute plans adopted prior to the Change in Control, unless an equitable arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to that plan, or the Company's failure to continue the Executive's participation in such a plan (or in a substitute or alternative plan) on a basis not materially less favorable, both in terms of the amount of benefits provided and the level of the Executive's participation relative to other participants, as existed at the time of the Change in Control.

Notwithstanding the foregoing, the occurrence of an event that would otherwise constitute Good Reason will cease to be an event constituting Good Reason if the Executive does not timely provide a Notice of Termination to the Company within 120 days of the date on which the Executive first becomes aware (or reasonably should have become aware) of the occurrence of that event.

"Non-Competition Period Payments" has the meaning as defined in the Confidentiality, Non-Competition and Non-Solicitation Agreement dated 6 May 2021, between the Company and the Executive.

“Notice of Termination” has the meaning as defined in section 2.2 of the Employment Agreement (i.e., notice period of 6 months from the end of the month in which the notice is given).

"Options" means options to purchase Shares awarded to the Executive during his employment with the Company.

"Person" has the meaning stated in section 3(a)(9) of the Exchange Act, as modified and used in sections 13(d) and 14(d) of the Exchange Act; however, a Person will not include (1) the Ultimate Parent Company or any of its subsidiaries, (2) a trustee or other fiduciary holding securities under an employee benefit plan of the Ultimate Parent Company or any of its subsidiaries, (3) an underwriter temporarily holding securities pursuant to an offering of those securities, or (4) a corporation owned, directly or indirectly, by the stockholders of the Ultimate Parent Company in substantially the same proportions as their ownership of stock of the Ultimate Parent Company.

"Potential Change in Control" will be deemed to have occurred if any one of the

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Change in Control Severance Agreement

following events occurs:

(a) the Ultimate Parent Company enters into an agreement, the consummation of which would result in the occurrence of a Change in Control;

(b) the Ultimate Parent Company or any Person publicly announces an intention to take or to consider taking actions that, if consummated, would constitute a Change in Control;

(c) any Person who is or becomes the Beneficial Owner, directly or indirectly, of securities of the Ultimate Parent Company representing 10% or more of the combined voting power of the Ultimate Parent Company's then outstanding securities, increases that Person's beneficial ownership of those securities by 5% or more over the percentage so owned by that Person on the date of this Agreement; or

(d) the Board adopts a resolution to the effect that, for purposes of this Agreement, a Potential Change in Control has occurred.

"Shares" means shares of the common stock, $0.01 par value, of the Ultimate Parent Company.

"Severance Payments" means the payments described in Section 3.2.

"Ultimate Parent Company" means Zimmer Biomet Holdings, Inc., a Delaware corporation, and any successor to its business and/or assets.

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Change in Control Severance Agreement

Annex 2

GENERAL RELEASE

Name: __________________________Notification Date:  ____________

Zimmer GmbH. (the "Company") has offered me certain severance benefits (the "Severance Benefits") pursuant to a Change in Control Severance Agreement ("Agreement") between the Company and me.  I will only be able to receive the Severance Benefits in consideration for my signing this General Release.

The Company has advised me of, and I acknowledge the following:

I have 30 days from the date I receive this General Release to consider and sign it. If I do not return this signed General Release in 30 days (INSERT DATE), the Company will consider this my refusal to sign, and I will not receive the Severance Benefits.  If I do sign this General Release, it will become immediately effective.

By signing this General Release I am giving up my right to sue the Company, and any affiliates, parent companies and subsidiaries, and their past, present and future officers, directors, employees, and agents (collectively, the "Released Parties") based upon any act or event occurring prior to my signing this General Release, to the fullest extent permitted by law.  Without limitation, and again to the fullest extent permitted by law, I specifically release the Company from any and all claims arising out of my employment and termination, including claims based on the Swiss Code of Obligations, the Labour Act and all applicable federal, cantonal and local laws.  

For the sake of clarification, I acknowledge that this General Release shall not affect my legal obligation to protect the confidentiality of the Company's information or any of my existing obligations under the Confidentiality, Non-Competition and Non-Solicitation Agreement that I executed during my employment with the Company (the "Non-Competition Agreement"), and I hereby reaffirm my covenants and obligations under the Non-Competition Agreement.

By signing this General Release, none of my benefits will be affected to which I am entitled under the Agreement or any claim arising out of the enforcement of the Agreement.

My signature below acknowledges that I have read the above, understand what I am signing, and am acting of my own free will.  The Company has advised me to consult with an attorney and any other advisors of my choice prior to signing this General Release.  

SIGNATURE  ________________________________   DATE  ____________________

PRINT NAME ________________________________

EX-10.7

Exhibit 10.7

Zimmer GmbH

Zahlerweg 4

CH-6300 Zug

Phone +41 (0)58 854 90 00

www.zimmerbiomet.com

Confidentiality, Non-Competition, and
Non-Solicitation Agreement

between

Zimmer GmbH

Zahlerweg 4, 6300 Zug

( „Employer“)

and

Mr Wilfred van Zuilen

( „Employee“)

(collectively the "Parties")

Recitals

(A) For purposes of this Agreement, "Parent" means an entity which is a holding company of or holds a controlling interest in Zimmer Biomet, Inc.(“Company” or “ZINC”); "Affiliate" means a subsidiary of Company or the Parent of Company or a company over which Company or any holding company of Company has control, including but not limited to Employer; and the definition of each of Company, Parent and Affiliates, includes any of their successors-in-interest, including, but not limited to, ZINC.

(B) Company, Parent and the Affiliates (collectively, and each individually "Zimmer Biomet Group") are part of the global holdings of Zimmer Biomet Holdings, Inc., a publicly traded corporation incorporated under the laws of the state of Delaware, U.S.A., the primary purpose of which is to serve as the umbrella entity for ZINC. Zimmer Biomet Group is engaged in the development, manufacture, distribution, and sale of orthopedic medical and/or oral rehabilitation devices, products, and services.

(C) Employee used to work as senior executive with Medtronic and continues to be bound by certain post-contractual non-competition restrictions of this company. The Parties are aware that Medtronic is competing with Zimmer Biomet Group in the Spine products range and that activities in these field might breach the Employee's restrictive covenants. The Parties have therefore agreed that Employee's employment responsibilities shall be structured in a manner to carve out the Spine products business in an effort to avoid conflicts with Employee's non-competition restrictions with Medtronic ("Carved-out Business").

Now therefore the Parties conclude the following agreement ("Agreement"):

1. Confidentiality

1.1 As used herein, "Confidential Information" shall include, but not be limited to, all business, trade, and technical information of Zimmer Biomet Group, and of any third party, whether patentable or not, which is of a confidential, trade secret and/or proprietary character and which is either developed by Employee (alone or with others) or to which Employee has had access during its employment with the Zimmer Biomet Group.

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1.2 Confidential Information includes, without limitation, the following:

(a) marketing, sales, and advertising information such as lists of actual or potential customers; customer preference data; marketing and sales techniques, strategies, efforts, and data; merchandising systems and plans and go to market models and strategies; confidential customer information including identification of purchasing personnel, third party suppliers and service providers, account status, needs and ability to pay; business plans; product development and delivery schedules; market research and forecasts; marketing and advertising plans, techniques, and budgets; overall pricing strategies; the specific advertising programs and strategies utilized, and the success or lack of success of those programs and strategies;

(b) organizational information such as personnel and salary data; merger, acquisition and expansion information; information concerning methods of operation; and divestiture information;

(c) financial information such as product costs; supplier information; overhead costs; profit margins; banking and financing information; and pricing policy practices;

(d) technical information such as product specifications, compounds, formulas, improvements, discoveries, developments, designs, inventions, techniques, new products and surgical training methods;

(e) information disclosed to Employee as part of a training process;

(f) information of third parties provided to Employee subject to non-disclosure restrictions for use in Employee's business for the Zimmer Biomet Group; and

(g) any work product created by Employee in rendering services for the Zimmer Biomet Group.

1.3 Employee shall not at any time during the continuance of his/her employment with the Zimmer Biomet Group or at any time thereafter directly or indirectly use for his/her own purposes or for any purposes other than those of the Zimmer Biomet Group, record, divulge, disclose or communicate to any person, company, business entity or other organization or, through any failure to exercise due care and diligence, cause any unauthorized disclosure of, any trade secrets or Confidential Information except as may be necessary for the proper performance of Employee's duties or as may be specifically authorized in writing by the Employer.

1.4 Employee will notify Employer in writing of any circumstances which may constitute unauthorized disclosure, transfer, or use of Confidential Information. Employee will use best efforts to protect Confidential Information from unauthorized disclosure, transfer, or use. Employee will implement and abide by all procedures adopted by the Zimmer Biomet Group to prevent unauthorized disclosure, transfer, or use of Confidential Information.

1.5 Upon termination of his/her employment with the Zimmer Biomet Group (for whatever reason), and at any other time at Employer's request, Employee shall, without retaining any copies or other record thereof, deliver to Employer or any person Employer may nominate each and every document and all other material of whatever nature in the possession or under the control of Employee containing or relating directly or indirectly to any Confidential Information.

1.6 The Employee undertakes when performing the duties under the employment agreement with Zimmer Biomet not to make use of any confidential information obtained from previous employers, including but not limited to the Carved-out Business that are covered by similar undertakings as set forth herein.

1.7 The confidentiality undertaking set forth in this Section 1 shall cease to apply to any information which shall become available to the public generally otherwise than through the default of Employee.

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2. Non-Competition, Non-Solicitation

2.1 Employee shall not, for as long as he/she remains an employee of the Zimmer Biomet Group and during a period of 18 months from the taking effect of the termination of his/her employment with the Zimmer Biomet Group ("Non-Competition Period"), alone, or jointly with, or as manager, agent for, or employee of any person or as a shareholder directly or indirectly carry on or be engaged, concerned or interested in any business competitive to the business of Zimmer Biomet Group with an effect in EMEA, or any other country for which Employee possesses and will possess knowledge of Confidential Information. The non-compete undertaking set forth in this Section shall apply to any product competing with the Employer's products lines, and in particular but not limited to activities for companies active in the orthopedic medical devices and joint replacement as well as robotic, services and solutions businesses, including their respective affiliates and subsidiaries, assignees, and successors. This non-competition covenant shall, however, not apply to the Carved-out Business.

2.2 Employee shall not during the Non-Competition Period (i) solicit, induce or attempt to induce any person who is an employee of the Zimmer Biomet Group to leave the Zimmer Biomet Group or to engage in any business that competes with the Zimmer Biomet Group; (ii) hire or assist in the hiring of any person who is an employee of the Zimmer Biomet Group to work for any business that competes with the Zimmer Biomet Group, or (iii) solicit, induce or attempt to induce any person or company that is a customer, supplier, service provider, distributor or sales agent of the Zimmer Biomet Group to discontinue or modify its customer relationship with the Zimmer Biomet Group.

3. Non-Competition Period Payments

3.1 To the extent Employee is unable to obtain employment consistent with Employee's training and education solely because of the provisions of this Agreement, the following terms will apply upon expiration of any severance benefits to which Employee is otherwise eligible to receive ("Non-Competition Period Payments"):

(a) Employer will make payments to Employee equal to 100% of the Employee's monthly base salary at the time of Employee's termination (exclusive of bonus, extra compensation and any other employee benefits) for each month of such unemployment through the end of the Non-Competition Period;

(b) to the extent Employee is able to obtain employment which does not violate this Agreement, but solely because of this Agreement, the monthly base salary for the replacement employment is less than Employee's monthly base salary at the time of Employee's termination (exclusive of bonus, extra compensation and any other employee benefits), Employer agrees to pay the difference up to 100% of the Employee's monthly base salary for each such month through the end of the Non-Competition Period;

(c) on the 15th day of each month of such unemployment, Employee will give Employer a detailed written account of Employee's efforts to obtain employment and an explanation exclusively attributing Employee's inability to obtain replacement employment to the provisions of this Agreement.

3.2 In the event of Employee's breach of the undertakings hereunder, Employee agrees that he will still be bound by all of the provisions set forth in this Agreement, including, but not limited to, the non-competition, non-solicitation, non-disparagement and non-disclosure covenants, until the end of the Non-Competition Period.

4. Remedies

4.1 For each violation of the covenants set forth in Sections 1 and/or 2, Employee shall pay to Employer or, at Employer's instruction, any other affiliate of the Zimmer Biomet Group, an amount corresponding to Employee's last annual salary at the time of Employee's termination

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(inclusive bonus payments, extra compensation and any other employee benefits) as liquidated damages plus such additional damages as may be incurred by Employer and/or any other affiliate of the Zimmer Group. The payment of this sum shall not operate as a waiver of the above obligations. Employer and/or any other affiliate of the Zimmer Biomet Group shall, in addition to all other damages, be entitled to obtain a court's order for specific performance, as well as adequate injunctive relief or any other adequate judicial measure, to immediately stop such violation.

4.2 To the extent that Employee breaches any provision of this Agreement during the Non-Competition Period and/or fails to timely submit the written account required by Section 3, Employer reserves, in addition to all other relief to which Employer shall be entitled, the right to cease making any Non-Competition Period Payments.

5. Miscellaneous

5.1 This Agreement constitutes and expresses the entire agreement between the Parties pertaining to the subject matter contained herein and supersedes all prior and contemporaneous oral or written agreements, representations, understandings and the like between the Parties.

5.2 This Agreement may not be modified, amended, altered or supplemented, in whole or in part, except by a written agreement signed by the Parties.

5.3 If any provision of this Agreement is found by any competent authority to be void, invalid or unenforceable, such provision shall be deemed to be deleted from this Agreement and the remaining provisions of this Agreement shall continue in full force. In this event, the Agreement shall be construed, and, if necessary, amended in a way to give effect to, or to approximate, or to achieve a result which is as close as legally possible to the result intended by the provision hereof determined to be void, illegal or unenforceable.

6. Waiver

Employer may at any time in its sole discretion waive all or certain of the restrictions under this Agreement respecting a notice period of one month. Employee acknowledges and agrees that in case the non-competition restriction is waived during the notice period under the employment agreement, there will be no entitlements to Non-Competition Period Payments under clause 3 of this Agreement. In case the waiver occurs following termination of employment, any Non-Competition Period Payment will cease once the one-month's period has lapsed.

7. Governing Law and Jurisdiction

7.1 This Agreement shall be governed by, interpreted and construed in accordance with the substantive laws of Switzerland.

7.2 The competent ordinary courts at the registered of Employer shall have exclusive jurisdiction for all disputes arising out of or in connection with this Agreement

Employee's signature below indicates that Employee has read the entire Agreement, Employee understands what Employee is signing, and is signing it voluntarily. Employee agrees that Zimmer         Biomet Group advised Employee to consult with an attorney prior to signing the Agreement.

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This Agreement enters into force on the later date set-out below.

Zug, May 5, 2021

Zimmer Gmbh

/s/ Carole Maire

Carole Maire

President EMEAHR VP EMEA

Agreed:

Place and Date: Woerden, May 5, 2021Employee:/s/ Wilfred van Zuilen

Wilfred van Zuilen

EX-21

Exhibit 21

Subsidiaries of Zimmer Biomet Holdings, Inc.

As of June 30, 2021

Name of Subsidiary1		Jurisdiction of Formation
Domestic subsidiaries:
	A&E Advanced Closure Systems, LLC	Delaware
	A&E Medical Corp.	New Jersey
	Alto Development Corp.	New Jersey
	Biomet 3i, LLC	Florida
	dba Zimmer Biomet Dental
	Biomet Biologics, LLC	Indiana
	Biomet CV Holdings, LLC	Delaware
	Biomet Fair Lawn LLC	Indiana
	Biomet International Orthopedics, LLC	Delaware
	Biomet International, Inc.	Delaware
	Biomet Leasing, Inc.	Indiana
	Biomet Manufacturing, LLC	Indiana
	Biomet Microfixation, LLC	Florida
	dba Zimmer Biomet CMF and Thoracic
	Biomet Orthopedics, LLC	Indiana
	Biomet Sports Medicine, LLC	Indiana
	dba Biomet Sports Medicine Limited Liability Company (Forced)
	Biomet Trauma, LLC	Indiana
	Biomet U.S. Reconstruction, LLC	Indiana
	Biomet, Inc.	Indiana
	dba Zimmer Biomet
	Cayenne Medical, Inc.	Delaware
	CD Diagnostics, Inc.	Delaware
	CD Laboratories, Inc.	Maryland
	Citra Labs, LLC	Indiana
	dba Biomet Citra Labs, LLC (Forced)
	Dornoch Medical Systems, Inc.	Illinois
	EBI Holdings, LLC	Delaware
	EBI Medical Systems, LLC	Delaware
	EBI, LLC	Indiana
	dba Zimmer Biomet Bone Healing Technologies
	dba Biomet Bone Healing Technologies
	dba Biomet Bracing
	dba Biomet Healing Technologies (Forced)
	dba Biomet Spine (Forced)
	dba Biomet Spine & Bone Healing Technologies
	dba Biomet Spine & Bone Healing Technologies, LLC (Forced)
	dba Biomet Spine & Bone Healing Technologies, Biomet Bracing and Biomet Osteobiologics, LLC (Forced)
	dba Biomet Trauma, Biomet Spine (Forced)
	dba Biomet Trauma, Biomet Spine, Biomet Bracing and Biomet Osteobiologics, LLC (Forced)
	dba EBI, LLC (IN) (Forced)
	dba EBI, LLC of Indiana (Forced)
	Electro-Biology, LLC	Delaware
	ETEX Corporation	Massachusetts
	dba Zimmer ETEX
	dba Zimmer Biomet ETEX
	ETEX Holdings, Inc.	Delaware
	dba Zimmer ETEX

Name of Subsidiary1		Jurisdiction of Formation
	dba Zimmer Biomet ETEX
	Implant Concierge, LLC	Texas
	Interpore Cross International, LLC	California
	dba Zimmer Biomet Irvine
	Kirschner Medical Corporation	Delaware
	LVB Acquisition, Inc.	Delaware
	Medical Compression Systems, Inc.	Delaware
	Medtech Surgical, Inc.	Delaware
	Orthopaedic Advantage, LLC	Indiana
	Relign Corporation	Delaware
	Synvasive Technology, Inc.	California
	VSC Medical Holdings, Inc.	Delaware
	ZB COOP LLC	Delaware
	ZB EMEA US UK LLC	Delaware
	ZB Manufacturing, LLC	Delaware
	Zimmer Biomet Distribution LLC	Delaware
	Zimmer Biomet Spine, Inc.	Delaware
	dba Lanx
	dba Zimmer Spine
	Zimmer Caribe, LLC	Delaware
	Zimmer CEP USA Holding Co.	Delaware
	Zimmer CEP USA, Inc.	Delaware
	Zimmer Co-op Holdings, LLC	Delaware
	Zimmer CV, Inc.	Delaware
	Zimmer Dental Inc.	Delaware
	Zimmer Knee Creations, Inc.	Delaware
	Zimmer Orthobiologics, Inc.	New Jersey
	Zimmer Production, Inc.	Delaware
	Zimmer Southeast Florida, LLC	Delaware
	Zimmer Spine Next, Inc.	Delaware
	Zimmer Surgical, Inc.	Delaware
	Zimmer Trabecular Metal Technology, Inc.	New Jersey
	Zimmer US, Inc.	Delaware
	dba Zimmer Biomet
	dba Zimmer Biomet Bay Area
	dba Zimmer Biomet Mid-Atlantic
	dba Zimmer Biomet North Texas
	dba Zimmer Biomet Southern California
	dba Zimmer US Cooperative
	dba Compression Therapy Concepts
	dba CTC Inc.
	Zimmer, Inc.	Delaware
	dba Zimmer Biomet
	dba Zimmer Biomet Corporate Services (Forced)
	dba Z Hotel
	dba CD Diagnostics
	dba CD Laboratories
Foreign subsidiaries:
	Biomet Argentina SA	Argentina
	Biomet 3i Australia Pty. Ltd.	Australia
	Biomet Australia Pty. Ltd.	Australia
	Zimmer Australia Holding Pty. Ltd.	Australia

Name of Subsidiary1		Jurisdiction of Formation
	Zimmer Biomet Pty. Ltd.	Australia
	Zimmer Biomet Austria GmbH	Austria
	ZH2LX Barbados Branch (branch)	Barbados
	Zimmer Biomet Finance Srl	Barbados
	Biomet 3i Belgium N.V.	Belgium
	Biomet 3i Benelux Holdings N.V.	Belgium
	Zimmer Biomet BVBA	Belgium
	Biomet Insurance Ltd.	Bermuda
	Biomet 3i do Brasil Comercio de Aparelhos Medicos Ltda.	Brazil
	Biomet Brazil Medical Device Ltda.	Brazil
	LDR Brasil Comercio, Importacao e Exportacao Ltda.	Brazil
	WM World Medical Importacao e Exportacao Ltda.	Brazil
	Zimmer do Brasil Comercio Ltda.	Brazil
	ORTHOsoft ULC	Canada
	dba Zimmer CAS
	Zimmer Biomet Canada, Inc.	Canada
	Zimmer Biomet Dental Canada Inc.	Canada
	ZB Cayman (Asia) Holding Ltd.	Cayman Islands
	ZB Cayman Island CBT 2 Ltd.	Cayman Islands
	Zimmer Cayman Islands Holding Co. Ltd.	Cayman Islands
	Biomet Chile SA	Chile
	Zimmer Dental Chile Spa	Chile
	Beijing Montagne Medical Device Co. Ltd.	China
	Biomet China Co., Ltd.	China
	Changzhou Biomet Medical Devices Co. Ltd.	China
	Shanghai Biomet Business Consulting Co. Ltd.	China
	Zhejiang Biomet Medical Products Co. Ltd.	China
	Zimmer Biomet CBT	China
	Zimmer Dental (Shanghai) Medical Device Co. Ltd.	China
	Zimmer (Shanghai) Medical International Trading Co., Ltd.	China
	Zimmer Biomet Colombia SAS	Colombia
	IC Guided Surgery, SRL	Costa Rica
	Zimmer Biomet Centroamerica SA	Costa Rica
	Zimmer Czech sro	Czech Republic
	Zimmer Biomet Denmark ApS	Denmark
	Zimmer Biomet Finland Oy	Finland
	Biomet France Sarl	France
	LDR Médical S.A.S.	France
	Medtech SA	France
	Zimmer Biomet France SAS	France
	Zimmer Biomet France Holdings SAS	France
	Zimmer Dental SAS	France
	Zimmer France Manufacturing Sarl	France
	Zimmer Spine SAS	France
	Biomet Deutschland GmbH	Germany
	Biomet Deutschland Holding GmbH	Germany
	Biomet Healthcare Management GmbH	Germany
	Zimmer Biomet Deutschland GmbH	Germany
	Zimmer Dental GmbH	Germany
	Zimmer Germany Holdings GmbH	Germany
	Zimmer International Logistics GmbH	Germany
	Zfx GmbH	Germany
	Zimmer Biomet Hellas SA	Greece

Name of Subsidiary1		Jurisdiction of Formation
	SM Re Ltd.	Guernsey
	Biomet Hong Kong Holding Ltd.	Hong Kong
	ZB Hong Kong CBT 2 Ltd.	Hong Kong
	ZB Hong Kong Holding Ltd.	Hong Kong
	ZB Hong Kong Ltd.	Hong Kong
	Zimmer Asia (HK) Ltd.	Hong Kong
	ZB Dental India Private Limited	India
	Zimmer India Private Ltd.	India
	Zimmer Biomet Ireland Limited	Ireland
	Zimmer Orthopedics Manufacturing Limited	Ireland
	D.S. Comp Ltd.	Israel
	Zimmer Biomet Comp Ltd.	Israel
	Zimmer Dental Ltd.	Israel
	3DIEMME Srl	Italy
	Lanx Srl	Italy
	Zimmer Dental Italy Srl	Italy
	Zimmer Biomet Italia Srl	Italy
	Zfx Innovation GmbH	Italy
	Zimmer Biomet Dental GK	Japan
	Zimmer Biomet GK	Japan
	Zimmer Biomet Korea Ltd.	Korea
	Zimmer Biomet OUS Holdings AG	Liechtenstein
	JERDS Luxembourg Holding Sarl	Luxembourg
	Zimmer Luxembourg Sarl	Luxembourg
	Zimmer Luxembourg II Sarl	Luxembourg
	Zimmer Medical Malaysia SDN BHD	Malaysia
	Biomet 3i Mexico S.A. de C.V.	Mexico
	Biomet Mexico S.A. de C.V.	Mexico
	Representaciones Zimmer Inc., S. de R.L. de C.V.	Mexico
	A&E Medical Concepts Holding B.V.	Netherlands
	A&E Medical Europe BV	Netherlands
	A&E Medical Europe Cooperatief U.A.	Netherlands
	Biomet 3i Netherlands B.V.	Netherlands
	Biomet C.V.	Netherlands
	Biomet Global Supply Chain Center B.V.	Netherlands
	Biomet Holdings B.V.	Netherlands
	Biomet Microfixation B.V.	Netherlands
	Medical Concepts Europe BV	Netherlands
	Medical Concepts Patents B.V.	Netherlands
	ZB COOP C.V.	Netherlands
	ZB (PW) Holdings B.V.	Netherlands
	Zimmer Biomet Asia Holding B.V.	Netherlands
	Zimmer Biomet Nederland B.V.	Netherlands
	Zimmer Biomet PW Global Holding B.V.	Netherlands
	Zimmer Manufacturing B.V.	Netherlands
	Zimmer Netherlands Cooperatief U.A.	Netherlands
	Zimmer Biomet New Zealand Company	New Zealand
	Zimmer Biomet Norway AS	Norway
	Zimmer Biomet Polska Sp. z.o.o	Poland
	Biomet 3i Portugal Lda	Portugal
	Zimmer Biomet Portugal Unipessoal, Lda	Portugal
	Biomet Orthopedics Puerto Rico, Inc.	Puerto Rico
	EBI Patient Care, Inc.	Puerto Rico

Name of Subsidiary1		Jurisdiction of Formation
	Lanx Puerto Rico, LLC	Puerto Rico
	Zimmer Manufacturing B.V. (branch)	Puerto Rico
	Zimmer Biomet Romania S.R.L.	Romania
	Zimmer CIS Ltd.	Russia
	Zimmer Biomet Asel Alarabiya Limited Company	Saudi Arabia
	Zimmer Biomet Asia Holdings Pte. Ltd.	Singapore
	Zimmer Pte. Ltd.	Singapore
	Zimmer Slovakia sro	Slovakia
	Zimmer Biomet South Africa (Pty) Ltd.	South Africa
	Biomet 3i Dental Iberica SL	Spain
	Biomet Spain Orthopaedics S.L.	Spain
	Zimmer Biomet Spain S.L.	Spain
	Biomet 3i Nordic AB	Sweden
	Biomet Cementing Technologies AB	Sweden
	Scandimed Holding AB	Sweden
	Zimmer Biomet Sweden AB	Sweden
	Biomet 3i Switzerland GmbH	Switzerland
	Zimmer Biomet Global Holdings Switzerland GmbH	Switzerland
	Zimmer GmbH	Switzerland
	Zimmer GmbH Euro IP Branch (branch)	Switzerland
	Zimmer GmbH, Winterthur Branch (branch)	Switzerland
	Zimmer Surgical SA	Switzerland
	Zimmer Switzerland Holdings LLC	Switzerland
	Zimmer Switzerland Manufacturing GmbH	Switzerland
	Zimmer Biomet Taiwan Co., Ltd.	Taiwan
	Zimmer Biomet (Thailand) Co., Ltd.	Thailand
	Biomet 3i Turkey	Turkey
	Zimmer Biomet Tibbi Cihazlar Sanayi ve Ticaret Anonim Sirketi	Turkey
	Zimmer Gulf FZ LLC	United Arab Emirates
	Biomet 3i UK Ltd.	United Kingdom
	Biomet Acquisitions (Unlimited)	United Kingdom
	Biomet UK Ltd.	United Kingdom
	Biomet UK Healthcare Ltd.	United Kingdom
	ZB EMEA 1 LP	United Kingdom
	ZB EMEA Finance UK 1 Ltd.	United Kingdom
	ZB EMEA Finance UK 2 Ltd.	United Kingdom
	ZB EMEA Finance UK 3 Ltd.	United Kingdom
	ZB EMEA Finance UK 4 Ltd.	United Kingdom
	ZB UK Group Holdings Limited	United Kingdom
	Zimmer Biomet UK Ltd.	United Kingdom
	Zimmer Trustee Ltd.	United Kingdom
	Zimmer UK Limited	United Kingdom

¹  Excludes certain entities that have de minimis activity or are in the process of being liquidated or dissolved and that, if considered in the aggregate as a single subsidiary, would not constitute a significant subsidiary.

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a)/15d-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Bryan C. Hanson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Zimmer Biomet Holdings, Inc.;

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 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 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:

(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 3, 2021

/s/ Bryan C. Hanson

Bryan C. Hanson

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a)/15d-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Suketu Upadhyay, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Zimmer Biomet Holdings, Inc.;

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 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 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:

(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 3, 2021

/s/ Suketu Upadhyay

Suketu Upadhyay

Executive Vice President and Chief Financial Officer

EX-32

Exhibit 32

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 on Form 10-Q of Zimmer Biomet Holdings, Inc. (the "Company") for the period ended June 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 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.

/s/ Bryan C. Hanson

Bryan C. Hanson

President and Chief Executive Officer

August 3, 2021

/s/ Suketu Upadhyay

Suketu Upadhyay

Executive Vice President and Chief Financial Officer

August 3, 2021

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2021	Jul. 28, 2021
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2021
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Entity Registrant Name	ZIMMER BIOMET HOLDINGS, INC.
Entity Central Index Key	0001136869
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		208,840,496
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity File Number	001-16407
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	13-4151777
Entity Address, Address Line One	345 East Main Street
Entity Address, City or Town	Warsaw
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	46580
City Area Code	574
Local Phone Number	267-6131
Document Quarterly Report	true
Document Transition Report	false
Common Stock [Member]
Document Information [Line Items]
Trading Symbol	ZBH
Security Exchange Name	NYSE
Title of 12(b) Security	Common Stock, $0.01 par value
1.414% Notes due 2022 [Member]
Document Information [Line Items]
Trading Symbol	ZBH 22A
Security Exchange Name	NYSE
Title of 12(b) Security	1.414% Notes due 2022
2.425% Notes due 2026 [Member]
Document Information [Line Items]
Trading Symbol	ZBH 26
Security Exchange Name	NYSE
Title of 12(b) Security	2.425% Notes due 2026
1.164% Notes due 2027 [Member]
Document Information [Line Items]
Trading Symbol	ZBH 27
Security Exchange Name	NYSE
Title of 12(b) Security	1.164% Notes due 2027

XML

Condensed Consolidated Statements of Earnings (unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Income Statement [Abstract]
Net Sales	$ 2,026.9	$ 1,226.1	$ 3,874.3	$ 3,009.9
Type of Revenue [Extensible List]	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember
Cost of products sold, excluding intangible asset amortization	$ 581.6	$ 424.5	$ 1,098.0	$ 911.6
Type of Cost, Good or Service [Extensible List]	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember
Intangible asset amortization	$ 154.6	$ 147.7	$ 310.1	$ 295.3
Research and development	180.5	87.7	274.9	186.1
Selling, general and administrative	817.4	665.0	1,587.5	1,493.9
Goodwill and intangible asset impairment	16.3	33.0	16.3	645.0
Restructuring and other cost reduction initiatives	19.6	28.0	41.4	73.0
Quality remediation	11.0	9.7	21.2	26.1
Acquisition, integration, divestiture and related	25.4	2.2	38.8	6.6
Operating expenses	1,806.4	1,397.8	3,388.2	3,637.6
Operating Profit (Loss)	220.5	(171.7)	486.1	(627.7)
Other income, net	8.1	3.8	15.4	6.8
Interest expense, net	(54.7)	(54.0)	(107.0)	(104.9)
Earnings (loss) before income taxes	173.9	(221.9)	394.5	(725.8)
Provision (benefit) for income taxes	31.4	(13.7)	54.3	(8.5)
Net Earnings (Loss)	142.5	(208.2)	340.2	(717.3)
Less: Net earnings (loss) attributable to noncontrolling interest	0.6	(1.6)	0.2	(2.2)
Net Earnings (Loss) of Zimmer Biomet Holdings, Inc.	$ 141.9	$ (206.6)	$ 340.0	$ (715.1)
Earnings (Loss) Per Common Share
Basic	$ 0.68	$ (1.00)	$ 1.63	$ (3.46)
Diluted	$ 0.67	$ (1.00)	$ 1.62	$ (3.46)
Weighted Average Common Shares Outstanding
Basic	208.6	206.8	208.3	206.6
Diluted	210.7	206.8	210.4	206.6

XML

Condensed Consolidated Statements of Comprehensive Income (Loss) (unaudited) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Statement Of Income And Comprehensive Income [Abstract]
Net Earnings (Loss)	$ 142.5	$ (208.2)	$ 340.2	$ (717.3)
Other Comprehensive (Loss) Income:
Foreign currency cumulative translation adjustments, net of tax	(13.6)	23.0	(32.7)	(31.2)
Unrealized cash flow hedge gains (losses), net of tax	2.2	(22.7)	42.1	32.1
Reclassification adjustments on hedges, net of tax	2.3	(13.1)	1.8	(26.6)
Adjustments to prior service cost and unrecognized actuarial assumptions, net of tax	(1.2)	2.1	(0.4)	1.8
Total Other Comprehensive Income (Loss)	(10.3)	(10.7)	10.8	(23.9)
Comprehensive Income (Loss)	132.2	(218.9)	351.0	(741.2)
Comprehensive income (loss) attributable to the noncontrolling interest	0.6	(1.6)	0.2	(2.2)
Comprehensive Income (Loss) Attributable to Zimmer Biomet Holdings, Inc.	$ 131.6	$ (217.3)	$ 350.8	$ (739.0)

XML

Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Current Assets:
Cash and cash equivalents	$ 1,042.4	$ 802.1
Accounts receivable, less allowance for credit losses	1,420.4	1,452.7
Inventories	2,533.0	2,450.7
Prepaid expenses and other current assets	361.0	377.8
Total Current Assets	5,356.8	5,083.3
Property, plant and equipment, net	2,005.2	2,047.7
Goodwill	9,247.6	9,261.8
Intangible assets, net	6,642.7	7,055.5
Other assets	970.9	969.4
Total Assets	24,223.2	24,417.7
Current Liabilities:
Accounts payable	360.6	330.0
Income taxes payable	41.8	59.5
Other current liabilities	1,476.1	1,667.4
Current portion of long-term debt	1,050.0	500.0
Total Current Liabilities	2,928.5	2,556.9
Deferred income taxes, net	722.8	790.4
Long-term income tax payable	581.6	588.1
Other long-term liabilities	604.5	656.4
Long-term debt	6,802.5	7,626.5
Total Liabilities	11,639.9	12,218.3
Commitments and Contingencies (Note 17)
Stockholders' Equity:
Common stock, $0.01 par value, one billion shares authorized, 312.5 million shares in 2021 (311.4 million in 2020) issued	3.1	3.1
Paid-in capital	9,248.6	9,121.6
Retained earnings	10,331.0	10,086.9
Accumulated other comprehensive loss	(287.0)	(297.8)
Treasury stock, 103.8 million shares in 2021 (103.8 million shares in 2020)	(6,717.8)	(6,719.6)
Total Zimmer Biomet Holdings, Inc. stockholders' equity	12,577.9	12,194.2
Noncontrolling interest	5.4	5.2
Total Stockholders' Equity	12,583.3	12,199.4
Total Liabilities and Stockholders' Equity	$ 24,223.2	$ 24,417.7

XML

Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares	Jun. 30, 2021	Dec. 31, 2020
Statement Of Financial Position [Abstract]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	312,500,000	311,400,000
Treasury stock, shares	103,800,000	103,800,000

XML

Condensed Consolidated Statements of Stockholders' Equity (unaudited) - USD ($) shares in Millions, $ in Millions	Total	Cumulative Effect, Period of Adoption, Adjustment [Member]	Common Stock [Member]	Paid-in Capital [Member]	Retained Earnings [Member]	Retained Earnings [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Accumulated Other Comprehensive (Loss) Income [Member]	Treasury Shares [Member]	Noncontrolling Interest [Member]
Balance at Dec. 31, 2019	$ 12,392.8		$ 3.1	$ 8,920.1	$ 10,427.3		$ (241.9)	$ (6,720.5)	$ 4.7
Balance, shares at Dec. 31, 2019			309.9					(103.9)
Net earnings (loss)	(717.3)				(715.1)				(2.2)
Other comprehensive income (loss)	(23.9)						(23.9)
Cash dividends declared	(99.3)				(99.3)
Stock compensation plans	94.7			93.9	0.2			$ 0.6
Stock compensation plans, shares			0.8					0.1
Balance at Jun. 30, 2020	11,643.9	$ (3.1)	$ 3.1	9,014.0	9,610.0	$ (3.1)	(265.8)	$ (6,719.9)	2.5
Balance, shares at Jun. 30, 2020			310.7					(103.8)
Balance at Mar. 31, 2020	11,882.7		$ 3.1	8,984.3	9,866.2		(255.1)	$ (6,719.9)	4.1
Balance, shares at Mar. 31, 2020			310.6					(103.8)
Net earnings (loss)	(208.2)				(206.6)				(1.6)
Other comprehensive income (loss)	(10.7)						(10.7)
Cash dividends declared	(49.7)				(49.7)
Stock compensation plans	29.8		$ 0.1	29.7	0.1
Balance at Jun. 30, 2020	11,643.9	$ (3.1)	$ 3.1	9,014.0	9,610.0	$ (3.1)	(265.8)	$ (6,719.9)	2.5
Balance, shares at Jun. 30, 2020			310.7					(103.8)
Balance at Dec. 31, 2020	12,199.4		$ 3.1	9,121.6	10,086.9		(297.8)	$ (6,719.6)	5.2
Balance, shares at Dec. 31, 2020			311.4					(103.8)
Net earnings (loss)	340.2				340.0				0.2
Other comprehensive income (loss)	10.8						10.8
Cash dividends declared	(100.0)				(100.0)
Stock compensation plans	132.9			127.0	4.1			$ 1.8
Stock compensation plans, shares			1.1
Balance at Jun. 30, 2021	12,583.3		$ 3.1	9,248.6	10,331.0		(287.0)	$ (6,717.8)	5.4
Balance, shares at Jun. 30, 2021			312.5					(103.8)
Balance at Mar. 31, 2021	12,449.8		$ 3.1	9,199.2	10,237.7		(276.7)	$ (6,718.3)	4.8
Balance, shares at Mar. 31, 2021			312.2					(103.8)
Net earnings (loss)	142.5				141.9				0.6
Other comprehensive income (loss)	(10.3)						(10.3)
Cash dividends declared	(50.0)				(50.0)
Stock compensation plans	51.3			49.4	1.4			$ 0.5
Stock compensation plans, shares			0.3
Balance at Jun. 30, 2021	$ 12,583.3		$ 3.1	$ 9,248.6	$ 10,331.0		$ (287.0)	$ (6,717.8)	$ 5.4
Balance, shares at Jun. 30, 2021			312.5					(103.8)

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Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) (unaudited) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Statement Of Stockholders Equity [Abstract]
Cash dividend declared per share	$ 0.24	$ 0.24	$ 0.48	$ 0.48

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Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Cash flows provided by (used in) operating activities:
Net earnings (loss)	$ 340.2	$ (717.3)
Adjustments to reconcile net earnings (loss) to cash provided by operating activities:
Depreciation and amortization	535.2	508.7
Share-based compensation	46.4	38.3
Goodwill and intangible asset impairment	16.3	645.0
Changes in operating assets and liabilities, net of acquired assets and liabilities
Income taxes	(37.3)	(46.1)
Receivables	5.3	272.7
Inventories	(94.4)	(122.6)
Accounts payable and accrued liabilities	(56.3)	(233.9)
Other assets and liabilities	(55.0)	53.3
Net cash provided by operating activities	700.4	398.1
Cash flows provided by (used in) investing activities:
Additions to instruments	(150.5)	(159.3)
Additions to other property, plant and equipment	(54.7)	(59.2)
Net investment hedge settlements	(9.6)	26.8
Other investing activities	(17.4)	(14.8)
Net cash used in investing activities	(232.2)	(206.5)
Cash flows provided by (used in) financing activities:
Proceeds from senior notes		1,497.1
Redemption of senior notes	(200.0)	(1,500.0)
Dividends paid to stockholders	(99.8)	(99.1)
Proceeds from employee stock compensation plans	91.5	61.7
Net cash flows from unremitted collections from factoring programs		(19.6)
Business combination contingent consideration payments	(6.5)	(7.5)
Debt issuance costs		(19.4)
Other financing activities	(9.3)	(6.1)
Net cash used in financing activities	(224.1)	(92.9)
Effect of exchange rates on cash and cash equivalents	(3.8)	(3.2)
Increase in cash and cash equivalents	240.3	95.5
Cash and cash equivalents, beginning of year	802.1	617.9
Cash and cash equivalents, end of period	$ 1,042.4	$ 713.4

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Basis of Presentation

6 Months Ended

Jun. 30, 2021

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Basis of Presentation

1.  Basis of Presentation

The financial data presented herein is unaudited and should be read in conjunction with the consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2020.

In our opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the financial position, results of operations and cash flows for the interim periods presented.  The December 31, 2020 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”).  Results for interim periods should not be considered indicative of results for the full year.

Risks and Uncertainties - Our results have been and are expected to continue to be impacted by the COVID-19 global pandemic. The vast majority of our net sales are derived from products used in elective surgical procedures which are being deferred due to precautions in certain markets.  The consequences of COVID-19 continue to be extremely fluid and there are many market dynamics that are difficult to predict.  The COVID-19 pandemic may have a significant unfavorable effect on our financial position, results of operations and cash flows in the near term.  

Planned Spinoff - On February 5, 2021, we announced our intention to pursue a plan to spin off our Spine and Dental businesses into a new public company (“SpinCo”).  The planned transaction is intended to benefit our stockholders by enhancing the focus of both Zimmer Biomet and SpinCo to meet the needs of patients and customers and, therefore, achieve faster growth and deliver greater value for all stakeholders.  The transaction is intended to qualify as a tax-free distribution, for U.S. federal income tax purposes, to U.S. stockholders of new publicly traded stock in SpinCo.  We are targeting completion of the spinoff by mid-2022, subject to the satisfaction of certain conditions, including, among others, final approval of our Board of Directors, receipt of a favorable opinion and Internal Revenue Service (“IRS”) ruling with respect to the tax-free nature of the transaction, obtaining debt financing for the new company, and the effectiveness of a Form 10 registration statement with the U.S. Securities and Exchange Commission (the “SEC”).  Therefore, we cannot provide assurance that we will be able to complete the spinoff on the terms or on the timeline that we announced, or at all.

The words “we,” “us,” “our” and similar words and “Zimmer Biomet” refer to Zimmer Biomet Holdings, Inc. and its subsidiaries.  “Zimmer Biomet Holdings” refers to the parent company only.

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Significant Accounting Policies

6 Months Ended

Jun. 30, 2021

Accounting Policies [Abstract]

Significant Accounting Policies

2.  Significant Accounting Policies  

Use of Estimates - The accompanying unaudited condensed consolidated financial statements are prepared in conformity with GAAP, which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  We have made our best estimates, as appropriate under GAAP, in the recognition of our assets and liabilities.  These estimates have considered the impact the COVID-19 pandemic may have on our financial position, results of operations and cash flows.  Such estimates included, but were not limited to, variable consideration to our customers, our allowance for doubtful accounts for expected credit losses, the net realizable value of our inventory, the fair value of our goodwill and the recoverability of other long-lived assets.  Actual results could differ materially from these estimates.

Accounting Pronouncements Recently Adopted

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-12 Simplifying the Accounting for Income Taxes.  ASU 2019-12 eliminates certain exceptions in the rules regarding the approach for intraperiod tax allocations and the methodology for calculating income taxes in an interim period, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill, among other things. We adopted this standard as of January 1, 2021. The adoption of this standard did not have a material impact on our financial position, results of operations or cash flows.

Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848).  ASU 2020-04 provides temporary optional guidance to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying generally accepted accounting principles to transactions affected by reference rate reform if certain criteria are met. Early adoption of this ASU is permitted, and we may elect to apply the amendments prospectively through December 31, 2022. We are currently evaluating the impact this ASU will have on our financial statements.

There are no recently issued accounting pronouncements that we have not yet adopted that are expected to have a material effect on our financial position, results of operations or cash flows.

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Revenue

6 Months Ended

Jun. 30, 2021

Revenue Recognition [Abstract]

Revenue

3.  Revenue

Net sales by geography are as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Americas	$	1,239.6	$	733.7	$	2,354.6	$	1,835.0
EMEA		429.8		218.7		814.0		616.8
Asia Pacific		357.5		273.7		705.7		558.1
Total	$	2,026.9	$	1,226.1	$	3,874.3	$	3,009.9

Net sales by product category are as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Knees	$	665.6	$	375.0	$	1,279.9	$	1,003.7
Hips		474.6		329.7		921.6		762.3
S.E.T.		462.1		292.7		879.7		673.6
Dental & Spine		263.5		152.3		509.5		371.8
Other		161.1		76.4		283.6		198.5
Total	$	2,026.9	$	1,226.1	$	3,874.3	$	3,009.9

In the first quarter of 2021, we updated our product category revenue reporting.  Product category sales include the following changes:

• Orthopedic robotic capital sales and services, previously reported in the Knee product category, are included in the Other product category;

• Disposable products used in computer-assisted surgeries, previously reported in the Other product category, are included in the Knees product category;

• CMFT (Craniomaxillofacial and Thoracic) products, previously reported in the Dental, Spine & CMFT category, are included in the S.E.T. (Sports Medicine, Extremities and Trauma) product category;

• CMFT has been removed from the Dental, Spine & CMFT product category and the name has been changed to Dental & Spine to reflect the revenue related to the spin off of SpinCo;

• Office based technologies products, previously reported in the Other product category, are included in the Dental & Spine product category;

• Other immaterial adjustments across product categories related to brand alignment.

Prior period product category sales have been reclassified to conform to the current presentation.

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Restructuring

6 Months Ended

Jun. 30, 2021

Restructuring And Related Activities [Abstract]

Restructuring

4.  Restructuring

In December 2019, our Board of Directors approved, and we initiated, a new global restructuring program (the “2019 Restructuring Plan”) with an objective of reducing costs to allow us to further invest in higher priority growth opportunities.  The 2019 Restructuring Plan is expected to result in total pre-tax restructuring charges of approximately $350 million to $400 million and reduce gross annual pre-tax operating expenses by approximately $200 million to $300 million by the end of 2023 as program benefits are realized.  The pre-tax restructuring charges consist of employee termination benefits; contract terminations for facilities and sales agents; and other charges, such as consulting fees, project management and relocation costs.  The restructuring charges incurred in the three and six-month periods ended June 30, 2021 primarily related to employee termination benefits, distributor contract terminations, consulting and project management.  The following table summarizes the liabilities recognized related to the 2019 Restructuring Plan (in millions):

	Employee
	Termination			Contract
	Benefits			Terminations			Other			Total
Expenses incurred in the three months ended June 30, 2021	$	1.8		$	1.5		$	12.0		$	15.3
Balance, December 31, 2020	$	38.7		$	10.9		$	15.1		$	64.7
Expenses incurred in the six months ended June 30, 2021		3.4			6.8			24.1			34.3
Cash payments		(8.5	)		(3.6	)		(17.7	)		(29.8	)
Foreign currency exchange rate changes		(0.7	)		-			-			(0.7	)
Balance, June 30, 2021	$	32.9		$	14.1		$	21.5		$	68.5
Expense incurred since the start of the 2019 Restructuring Plan	$	81.9		$	22.6		$	74.3		$	178.8
Expense estimated to be recognized for the 2019 Restructuring Plan	$	180.0		$	25.0		$	170.0		$	375.0

For the expense estimated to be recognized for the 2019 Restructuring Plan, we have disclosed the midpoint in our estimated range of expenses.  We do not include restructuring charges in the operating profit of our reportable segments.    

In our condensed consolidated statement of earnings, we report restructuring charges in our “Restructuring and other cost reduction initiatives” financial statement line item.  We report the expenses for other cost reduction initiatives with restructuring expenses because these activities also have the goal of reducing costs across the organization.  However, since the cost reduction initiative expenses are not considered restructuring, they have been excluded from the amounts presented in this note.

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Inventories

6 Months Ended

Jun. 30, 2021

Inventory Disclosure [Abstract]

Inventories

5.  Inventories

	June 30,		December 31,
	2021		2020
	(in millions)
Finished goods	$	2,024.0	$	1,954.6
Work in progress		229.5		223.7
Raw materials		279.5		272.4
Inventories	$	2,533.0	$	2,450.7

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Property, Plant and Equipment

6 Months Ended

Jun. 30, 2021

Property Plant And Equipment [Abstract]

Property, Plant and Equipment

6.  Property, Plant and Equipment

	June 30,			December 31,
	2021			2020
	(in millions)
Land	$	27.5		$	27.7
Buildings and equipment		2,266.4			2,197.8
Capitalized software costs		450.9			455.8
Instruments		3,668.3			3,518.3
Construction in progress		110.0			125.3
		6,523.1			6,324.9
Accumulated depreciation		(4,517.9	)		(4,277.2	)
Property, plant and equipment, net	$	2,005.2		$	2,047.7

We had $19.5 million and $24.4 million of property, plant and equipment included in accounts payable as of June 30, 2021 and December 31, 2020, respectively.

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Acquisitions

6 Months Ended

Jun. 30, 2021

Business Combinations [Abstract]

Acquisitions

7.Acquisitions

In the fourth quarter of 2020, we completed the acquisitions of A&E Medical Corporation (“A&E Medical”), a sternal closure company, and Relign Corp. (“Relign”), an arthroscopy equipment company (collectively referred to as the “2020 acquisitions”).  The 2020 acquisitions were completed primarily to expand our product offerings in the CMFT and sports medicine markets.  The total aggregate cash consideration paid in 2020 related to the 2020 acquisitions was $244.9 million, with an additional $145.0 million of guaranteed deferred payments to be made in the second half of 2021.  We have assigned a fair value of $31.3 million for potential additional payments as of the acquisition dates related to these acquisitions that are contingent on the respective acquired companies’ future product sales.  The estimated fair value of the aggregate contingent payment liabilities was calculated based on the probability of achieving the specified sales growth and discounting to present value the estimated payments.  

The goodwill related to the 2020 acquisitions represents the excess of the consideration transferred over the fair value of the net assets acquired.  The goodwill related to the 2020 acquisitions is generated from the operational synergies and cross-selling opportunities we expect to achieve from the technologies acquired.  None of the goodwill related to these acquisitions is expected to be deductible for tax purposes.

The purchase price allocations as of June 30, 2021 are preliminary.  We need additional time to finalize the acquired companies’ tax returns and evaluate their tax attributes, which may change the recognized tax assets and liabilities.  There may be differences between the preliminary estimates of fair value and the final acquisition accounting. The final estimates of fair value are expected to be completed as soon as possible, but no later than one year after the respective acquisition dates.

The following table summarizes the aggregate preliminary estimates of fair value of the assets acquired and liabilities assumed related to the 2020 acquisitions (in millions):

Current assets	$	33.6
Intangible assets subject to amortization:
Technology		147.9
Trademarks and trade names		1.5
Customer relationships		92.7
Other		4.9
Goodwill		189.9
Other assets		5.4
Total assets acquired		475.9
Current liabilities		4.5
Deferred income taxes		48.5
Other long-term liabilities		1.7
Total liabilities assumed		54.7
Net assets acquired	$	421.2

In the six-month period ended June 30, 2021 we adjusted the preliminary fair values that were recognized as of December 31, 2020.  The adjustments primarily related to the customer relationships intangible asset and the related deferred income tax liability as we refined our estimates by analyzing historical purchasing patterns of existing customers.  The adjustment did not result in a significant change to intangible asset amortization expense recognized in the six-month period ended June 30, 2021 that would have been recognized in the previous period if the adjustment were recognized as of the acquisition date. There were no significant adjustments during the three-month period ended June 30, 2021.

The weighted average amortization period selected for technology, trademarks and trade names, customer relationships and other intangible assets were 13 years, 12 years, 15 years and 5 years, respectively.

We have not included pro forma information and certain other information under GAAP for the 2020 acquisitions because they did not have a material impact on our financial position or results of operations.

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Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

8.  Goodwill and Intangible Assets

The following table summarizes the changes in the carrying amount of goodwill by reportable segment, including the effects of changes to our reportable segments (in millions):

	Americas Orthopedics			EMEA			Asia Pacific			Americas Spine and Global Dental			Total
Balance at December 31, 2020
Goodwill	$	9,583.7		$	1,362.9		$	580.8		$	-		$	11,527.4
Accumulated impairment losses		(1,228.6	)		(1,037.0	)		-			-			(2,265.6	)
	$	8,355.1		$	325.9		$	580.8		$	-		$	9,261.8
Goodwill reportable segment change		(1,491.3	)		-			-			1,491.3			-
Accumulated impairment losses reportable segment change		1,220.9			-			-			(1,220.9	)		-
Purchase accounting adjustments		21.1			5.2			2.3			-			28.6
Other acquisitions		2.4			-			-			-			2.4
Currency translation		(29.3	)		(7.6	)		(9.0	)		0.7			(45.2	)
Balance at June 30, 2021
Goodwill	$	8,086.6		$	1,360.5		$	574.1		$	1,492.0		$	11,513.2
Accumulated impairment losses		(7.7	)		(1,037.0	)		-			(1,220.9	)		(2,265.6	)
	$	8,078.9		$	323.5		$	574.1		$	271.1		$	9,247.6

As discussed further in Note 16, our operating and reportable segments have changed.  Goodwill has been reallocated from our previous reportable segments to reflect the new structure.  However, our reporting units have not changed. The Americas Spine and Global Dental reporting units are now assigned to the new Americas Spine and Global Dental reportable segment.

As of March 31, 2020, we tested three of our reporting units for impairment due to: i) the significant adverse effect the COVID-19 pandemic was expected to have on our operating results, and ii) a change in reportable segments in the first quarter of 2020, which changed the cash flows and asset compositions of certain reporting units.  This resulted in goodwill impairment charges of $470.0 million and $142.0 million recognized for our Europe, Middle East and Africa (“EMEA”) reporting unit and Global Dental reporting unit, respectively.  The remaining two reporting units with goodwill assigned to them were not tested for impairment as we concluded it is more likely than not the fair value of these reporting units exceeds their carrying value. The goodwill balance related to the Americas Spine reporting unit was already fully impaired.

The impairment charge of $470.0 million in our EMEA reporting unit was due to the COVID-19 pandemic and reportable segment change.  The COVID-19 pandemic has had a significant adverse effect on both the operational and non-operational assumptions used to estimate the fair value of our EMEA reporting unit.  The significant decline in our share price and that of most other publicly-traded companies resulted in us utilizing a higher risk-adjusted discount rate compared to the rate used in our 2019 annual goodwill impairment test to discount our future estimated cash flows to present value.  On an operational basis, due to the deferral of elective surgical procedures, at the time of the March 31, 2020 impairment test, we estimated cash flows in 2020 to be significantly lower than previously estimated in the 2019 annual goodwill impairment test.  The change in reportable segments resulted in additional impairment due to additional assets being allocated to the EMEA reporting unit.  As of June 30, 2021, $323.5 million of goodwill remains in the EMEA reporting unit.  

The impairment charge of $142.0 million in our Global Dental reporting unit was driven by the COVID-19 pandemic.  Similar to our EMEA reporting unit, changes in the market caused an increase to the risk-adjusted discount rates utilized to discount our future estimated cash flows to present value, and we expected that the deferral of elective dental procedures would have an adverse effect on our cash flows.  We estimated the cash flows from our Global Dental reporting unit may recover more slowly than our other reporting units because many dental procedures are not covered by insurance.  Therefore, we estimated economic uncertainty would likely result in patients deferring dental procedures for a longer period of time than procedures involving our other products.  As of June 30, 2021, $271.1 million of goodwill remains in the Global Dental reporting unit.  

The third reporting unit we tested for impairment, Americas CMFT, had an estimated fair value that exceeded its carrying value by less than 5 percent.  The Americas CMFT reporting unit’s estimated fair value was also adversely impacted by the COVID-19 pandemic similar to our EMEA and Global Dental reporting units.   

We estimated the fair value of the EMEA, Global Dental and Americas CMFT reporting units based on income and market approaches.  Fair value under the income approach was determined by discounting to present value the estimated future cash flows of the reporting unit.  Fair value under the market approach utilized the guideline public company methodology, which uses valuation indicators from publicly-traded companies that are similar to our EMEA, Global Dental and Americas CMFT reporting units and considers differences between our reporting unit and the comparable companies.

In estimating the future cash flows of the reporting units, we utilized a combination of market and company-specific inputs that a market participant would use in assessing the fair value of the reporting units.  The primary market input was revenue growth rates.  These rates were based upon historical trends and estimated future growth drivers such as an aging global population, obesity and more active lifestyles.  The impact of declining revenue from the COVID-19 pandemic was included in the future cash flows.  Significant company specific inputs included assumptions regarding how the reporting units could leverage operating expenses as revenue grows and the impact any of our differentiated products or new products will have on revenues.

Under the guideline public company methodology, we took into consideration specific risk differences between our reporting unit and the comparable companies, such as recent financial performance, size risks and product portfolios, among other considerations.

We perform our annual test of goodwill impairment in the fourth quarter of every year.  In connection with the 2020 annual goodwill impairment test in the fourth quarter of 2020, we performed a qualitative test on our Asia Pacific reporting unit and concluded it was more likely than not the fair value of this reporting unit exceeded its carrying value.  We estimated the fair value of our Americas Orthopedics, Americas CMFT, EMEA and Global Dental reporting units using the income and market approaches.  The estimated fair values of our reporting units increased in the fourth quarter impairment test compared to the March 31, 2020 test due to the negative effects on discounted cash flows from the COVID-19 pandemic forecasted for second and third quarters of 2020 no longer being in the future cash flow estimates.  As a result, the estimated fair value of each reporting unit exceeded its carrying value by more than 10 percent.

We will continue to monitor the fair value of our EMEA, Global Dental and Americas CMFT reporting units as well as our other two reporting units in our interim and annual reporting periods.  If our estimated cash flows for these reporting units decrease, we may have to record further impairment charges in the future.  Factors that could result in our cash flows being lower than our current estimates include: 1) the COVID-19 pandemic causes elective surgical procedures to be deferred longer than our estimates, or additional recurrence of the virus causes hospitals to defer elective surgical procedures, 2) decreased revenues caused by unforeseen changes in the healthcare market, or our inability to generate new product revenue from our research and development activities, and 3) our inability to achieve the estimated operating margins in our forecasts due to unforeseen factors.  Additionally, changes in the broader economic environment could cause changes to our estimated discount rates and comparable company valuation indicators, which may impact our estimated fair values.

In the three and six-month periods ended June 30, 2021 and 2020, we recognized $16.3 million and $33.0 million, respectively, of in-process research and development (“IPR&D”) intangible asset impairments on certain IPR&D projects.  The $16.3 million impairment charge in 2021 is related to a terminated project. The $33.0 million charge in 2020 includes a $19.0 million impairment related to a project that required additional research and development costs to complete, which delayed the cash inflows and resulted in a decreased estimated fair value.  The remaining $14.0 million impairment charge in 2020 is related to terminated projects.  The termination of these projects is the result of obstacles encountered to achieve regulatory approval or prioritizing our internal research and development portfolio to focus our engineering resources on the opportunities that most closely link to our mission.  Since these projects had a low probability of success or were not a priority, their terminations are not expected to have a significant impact on our future cash flows.

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Transfers of Financial Assets

6 Months Ended

Jun. 30, 2021

Transfers And Servicing [Abstract]

Transfers of Financial Assets

9.  Transfers of Financial Assets

We have receivables purchase arrangements with unrelated third parties to liquidate portions of our trade accounts receivable balance.  The receivables relate to products sold to customers and are short-term in nature.  The factorings are treated as sales of our accounts receivable.  Proceeds from the transfers reflect either the face value of the accounts receivable or the face value less factoring fees.  

We terminated our programs in the U.S. and Japan in the fourth quarter of 2020.  We acted as the collection agent on behalf of the third party, but had no significant retained interests or servicing liabilities related to the accounts receivable sold.  As of December 31, 2020, we had collected and remitted or repurchased all factored receivables at the time of the termination of those programs in 2020.

In Europe, we sell to a third party and have no continuing involvement or significant risk with the factored accounts receivable.

Funds received from the transfers are recorded as an increase to cash and a reduction to accounts receivable outstanding in the condensed consolidated balance sheets.  We report the cash flows attributable to the sale of receivables to third parties in cash flows from operating activities in our condensed consolidated statements of cash flows.  Net expenses resulting from the sales of receivables are recognized in selling, general and administrative expense.  Net expenses include any resulting gains or losses from the sales of receivables, credit insurance and factoring fees.

In the six-month periods ended June 30, 2021 and 2020, we sold receivables having an aggregate face value of $70.2 million and $980.9 million to third parties in exchange for cash proceeds of $69.7 million and $979.9 million, respectively.  Expenses recognized on these sales during the six-month periods ended June 30, 2021 and 2020 were not significant.  In the six-month period ended June 30, 2020, under the U.S. and Japan programs, we collected $885.8 million from our customers and remitted that amount to the third party, and we effectively repurchased $84.1 million of previously sold accounts receivable from the third party, due to the programs’ revolving nature.  The initial collection of cash from customers and its remittance to the third party is reflected in net cash provided by/(used in) financing activities in our condensed consolidated statements of cash flows.  No amounts were unremitted to third parties as of June 30, 2021 and December 31, 2020.

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Debt

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Debt

10.  Debt

Our debt consisted of the following (in millions):

	June 30,			December 31,
	2021			2020
Current portion of long-term debt
3.375% Senior Notes due 2021	$	300.0		$	300.0
3.150% Senior Notes due 2022		750.0			-
Floating Rate Notes due 2021		-			200.0
Total current portion of long-term debt	$	1,050.0		$	500.0
Long-term debt
3.150% Senior Notes due 2022	$	-		$	750.0
3.700% Senior Notes due 2023		300.0			300.0
3.550% Senior Notes due 2025		2,000.0			2,000.0
3.050% Senior Notes due 2026		600.0			600.0
3.550% Senior Notes due 2030		900.0			900.0
4.250% Senior Notes due 2035		253.4			253.4
5.750% Senior Notes due 2039		317.8			317.8
4.450% Senior Notes due 2045		395.4			395.4
1.414% Euro Notes due 2022		593.0			611.8
2.425% Euro Notes due 2026		593.0			611.8
1.164% Euro Notes due 2027		593.0			611.8
Japan Term Loan A		105.3			113.3
Japan Term Loan B		191.8			206.3
Debt discount and issuance costs		(41.7	)		(48.2	)
Adjustment related to interest rate swaps		1.5			3.1
Total long-term debt	$	6,802.5		$	7,626.5

At June 30, 2021, our total current and non-current debt of $7.9 billion consisted of $7.6 billion aggregate principal amount of our senior notes, which included $1.8 billion Euro-denominated senior notes (“Euro Notes”), an 11.7 billion Japanese Yen term loan agreement (“Japan Term Loan A”) and a 21.3 billion Japanese Yen term loan agreement (“Japan Term Loan B”) that will each mature on September 27, 2022, and other debt and fair value adjustments totaling $1.5 million, partially offset by debt discount and issuance costs of $41.7 million.

In the six-month period ended June 30, 2021, we repaid $200.0 million on our Floating Rate Notes due 2021.

On March 20, 2020, we completed the offering of $600.0 million aggregate principal amount of our 3.050% senior notes due on January 15, 2026 and $900.0 million aggregate principal amount of our 3.550% senior notes due on March 20, 2030.  Interest payable on the 3.050% senior notes is payable semi-annually, commencing on July 15, 2020 until maturity. Interest payable on the 3.550% senior notes is payable semi-annually, commencing on September 20, 2020 until maturity.  The proceeds from the offering, together with cash on hand, were used to repay at maturity the $1.5 billion principal amount of 2.700% senior notes due on April 1, 2020.

We have a revolving credit agreement (the “2019 Credit Agreement”), which contains a five-year unsecured multicurrency revolving facility of $1.5 billion (the “2019 Multicurrency Revolving Facility”).  The 2019 Credit Agreement will mature on November 1, 2024, with two one-year extensions exercisable at our discretion and subject to required lender consent.  The 2019 Credit Agreement also includes an uncommitted incremental feature allowing us to request an increase of the facility by an aggregate amount of up to $500.0 million.  As of June 30, 2021, there were no outstanding borrowings under the 2019 Multicurrency Revolving Facility.

Borrowings under the 2019 Credit Agreement generally bear interest at floating rates.  We pay a facility fee on the aggregate amount of the 2019 Multicurrency Revolving Facility.  The 2019 Credit Agreement contains customary affirmative and negative covenants and events of default for unsecured financing arrangements, including, among other things, limitations on consolidations, mergers, and sales of assets.   On April 23, 2020, we entered into an amendment to the 2019 Credit Agreement to temporarily increase the maximum permitted consolidated indebtedness to consolidated EBITDA ratio (“Consolidated Leverage Ratio”), temporarily increase the interest rate margin applicable to revolving loans and the facility fee, and make other administrative changes.  Pursuant to the amendment, the maximum permitted Consolidated Leverage Ratio as of the last day of any period of four consecutive fiscal quarters under the 2019 Credit Agreement is (i) 5.75 to 1.00 for periods ending between April 1, 2020 and including December 31, 2020, (ii) 5.00 to 1.00 for the period ending March 31, 2021, and (iii) 4.50 to 1.00 for periods ending after April 1, 2021 (with such maximum permitted Consolidated Leverage Ratio subject to increase to 5.00 to 1.00 for a period of time in connection with a qualified material acquisition on or after July 1, 2021).  We were in compliance with all covenants under the 2019 Credit Agreement as of June 30, 2021. The amendment also increased the interest rate margin applicable to revolving loans and the facility fee, each of which are determined by reference to our senior unsecured long-term debt credit rating, through June 30, 2021.  On February 26, 2021, we entered into a further amendment to the 2019 Credit Agreement to facilitate the addition of a new lender while maintaining the amount of the credit facility at $1.5 billion and incorporating certain administrative changes.   

On April 23, 2020, we entered into a revolving credit agreement which was an unsecured revolving credit facility of $1.0 billion (the “April 2020 Revolving Facility”).  In conjunction with a new revolving credit agreement (the “September 2020 Credit Agreement”) entered into on September 18, 2020, the April 2020 Revolving Facility was terminated.  We never borrowed against the April 2020 Revolving Facility.  The September 2020 Credit Agreement is a $1.0 billion 364-day unsecured revolving credit facility (the “September 2020 Revolving Facility”).  The September 2020 Revolving Facility will be used for general corporate purposes.  The September 2020 Credit Agreement matures on September 17, 2021. Borrowings under the September 2020 Credit Agreement generally bear interest at floating rates.  We pay a facility fee on the aggregate amount of the September 2020 Revolving Facility.  The September 2020 Credit Agreement contains customary affirmative and negative covenants and events of default for an unsecured financing arrangement including, among other things, limitations on consolidations, mergers, and sales of assets.  The September 2020 Credit Agreement requires us to maintain a Consolidated Leverage Ratio as of the last day of any period of four consecutive fiscal quarters of no greater than (i) 5.75 to 1.00 for periods ending during the period from September 18, 2020 to and including December 31, 2020, (ii) 5.00 to 1.00 for the period ending March 31, 2021, and (iii) 4.50 to 1.00 for periods ending after April 1, 2021 (with such permitted Consolidated Leverage Ratio subject to increase to 5.00 to 1.00 for a period of time in connection with a qualified material acquisition on or after July 1, 2021).  We were in compliance with all covenants under the September 2020 Credit Agreement, as of June 30, 2021.  As of June 30, 2021, there were no outstanding borrowings under the September 2020 Credit Agreement.

The estimated fair value of our senior notes as of June 30, 2021, based on quoted prices for the specific securities from transactions in over-the-counter markets (Level 2), was $8,238.2 million.  The estimated fair value of Japan Term Loan A and Japan Term Loan B, in the aggregate, as of June 30, 2021, based upon publicly available market yield curves and the terms of the debt (Level 2), was $296.5 million.

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Accumulated Other Comprehensive Income

6 Months Ended

Jun. 30, 2021

Equity [Abstract]

Accumulated Other Comprehensive Income

11.  Accumulated Other Comprehensive Income

Accumulated other comprehensive income (loss) (“AOCI”) refers to certain gains and losses that under GAAP are included in comprehensive income but are excluded from net earnings as these amounts are initially recorded as an adjustment to stockholders’ equity.  Amounts in AOCI may be reclassified to net earnings upon the occurrence of certain events.  

Our AOCI is comprised of foreign currency translation adjustments, unrealized gains and losses on cash flow hedges and unrecognized prior service costs and gains and losses in actuarial assumptions related to our defined benefit plans.  Foreign currency translation adjustments are reclassified to net earnings upon sale or upon a complete or substantially complete liquidation of an investment in a foreign entity.  Unrealized gains and losses on cash flow hedges are reclassified to net earnings when the hedged item affects net earnings.  Amounts related to defined benefit plans that are in AOCI are reclassified over the service periods of employees in the plan.

The following table shows the changes in the components of AOCI gains (losses), net of tax (in millions):

	Foreign			Cash			Defined
	Currency			Flow			Benefit			Total
	Translation			Hedges			Plan Items			AOCI
Balance at December 31, 2020	$	(7.2	)	$	(55.6	)	$	(235.0	)	$	(297.8	)
AOCI before reclassifications		(32.7	)		42.1			-			9.4
Reclassifications to statements of earnings		-			1.8			(0.4	)		1.4
Balance at June 30, 2021	$	(39.9	)	$	(11.7	)	$	(235.4	)	$	(287.0	)

The following table shows the reclassification adjustments from AOCI (in millions):

	Amount of Gain (Loss)
	Reclassified from AOCI
	Three Months Ended						Six Months Ended
	June 30,						June 30,						Location on
Component of AOCI	2021			2020			2021			2020			Statements of Earnings
Cash flow hedges
Foreign exchange forward contracts	$	(2.6	)	$	15.1		$	(1.5	)	$	30.7		Cost of products sold
Forward starting interest rate swaps		(0.2	)		(0.1	)		(0.3	)		(0.3	)	Interest expense, net
		(2.8	)		15.0			(1.8	)		30.4		Total before tax
		(0.5	)		1.9			-			3.8		Provision (benefit) for income taxes
	$	(2.3	)	$	13.1		$	(1.8	)	$	26.6		Net of tax
Defined benefit plans
Prior service cost and unrecognized actuarial gain (loss)	$	1.8		$	(1.7	)	$	0.3		$	(3.4	)	Other income, net
		0.6			0.4			(0.1	)		(1.6	)	Provision (benefit) for income taxes
	$	1.2		$	(2.1	)	$	0.4		$	(1.8	)	Net of tax
Total reclassifications	$	(1.1	)	$	11.0		$	(1.4	)	$	24.8		Net of tax

The following table shows the tax effects on each component of AOCI recognized in our condensed consolidated statements of comprehensive income (loss) (in millions):

	Three Months Ended June 30, 2021									Six Months Ended June 30, 2021
	Before Tax			Tax			Net of Tax			Before Tax			Tax		Net of Tax
Foreign currency cumulative translation adjustments	$	(18.2	)	$	(4.6	)	$	(13.6	)	$	(17.6	)	$	15.1	$	(32.7	)
Unrealized cash flow hedge gains		0.4			(1.8	)		2.2			47.9			5.8		42.1
Reclassification adjustments on cash flow hedges		2.8			0.5			2.3			1.8			-		1.8
Adjustments to prior service cost and unrecognized actuarial assumptions		(1.8	)		(0.6	)		(1.2	)		(0.3	)		0.1		(0.4	)
Total Other Comprehensive (Loss) Income	$	(16.8	)	$	(6.5	)	$	(10.3	)	$	31.8		$	21.0	$	10.8

	Three Months Ended June 30, 2020									Six Months Ended June 30, 2020
	Before Tax			Tax			Net of Tax			Before Tax			Tax			Net of Tax
Foreign currency cumulative translation adjustments	$	4.3		$	(18.7	)	$	23.0		$	(24.9	)	$	6.3		$	(31.2	)
Unrealized cash flow hedge (losses) gains		(27.6	)		(4.9	)		(22.7	)		38.1			6.0			32.1
Reclassification adjustments on cash flow hedges		(15.0	)		(1.9	)		(13.1	)		(30.4	)		(3.8	)		(26.6	)
Adjustments to prior service cost and unrecognized actuarial assumptions		1.7			(0.4	)		2.1			3.4			1.6			1.8
Total Other Comprehensive Loss	$	(36.6	)	$	(25.9	)	$	(10.7	)	$	(13.8	)	$	10.1		$	(23.9	)

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Fair Value Measurement of Assets and Liabilities

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurement of Assets and Liabilities

12.  Fair Value Measurement of Assets and Liabilities

The following financial assets and liabilities are recorded at fair value on a recurring basis (in millions):

	As of June 30, 2021
			Fair Value Measurements at Reporting Date Using:
Description	Recorded Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Derivatives designated as hedging, current and long-term
Foreign currency forward contracts	$	15.9	$	-	$	15.9	$	-
Cross-currency interest rate swaps		4.7		-		4.7		-
Interest rate swaps		0.8		-		0.8		-
Total Assets	$	21.4	$	-	$	21.4	$	-
Liabilities
Derivatives designated as hedging, current and long-term
Foreign currency forward contracts	$	12.1	$	-	$	12.1	$	-
Cross-currency interest rate swaps		13.4		-		13.4		-
Interest rate swaps		0.7		-		0.7		-
Contingent payments related to acquisitions		43.1		-		-		43.1
Total Liabilities	$	69.3	$	-	$	26.2	$	43.1

	As of December 31, 2020
			Fair Value Measurements at Reporting Date Using:
Description	Recorded Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Derivatives designated as hedges, current and long-term
Foreign currency forward contracts	$	0.5	$	-	$	0.5	$	-
Derivatives not designated as hedges, current and long-term
Foreign currency forward contracts		0.9		-		0.9		-
Total Assets	$	1.4	$	-	$	1.4	$	-
Liabilities
Derivatives designated as hedges, current and long-term
Foreign currency forward contracts	$	48.5	$	-	$	48.5	$	-
Cross-currency interest rate swaps		83.3		-		83.3		-
Derivatives not designated as hedges, current and long-term
Foreign currency forward contracts		3.2		-		3.2		-
Contingent payments related to acquisitions		48.2		-		-		48.2
Total Liabilities	$	183.2	$	-	$	135.0	$	48.2

We value our foreign currency forward contracts using a market approach based on foreign currency exchange rates obtained from active markets, and we perform ongoing assessments of counterparty credit risk.  

We value our interest rate swaps using a market approach based on publicly available market yield curves and the terms of our swaps, and we perform ongoing assessments of counterparty credit risk. The valuation of the cross-currency interest rate swaps also includes consideration of foreign currency exchange rates.

Contingent payments related to acquisitions consist of sales-based payments, and are valued using discounted cash flow techniques.  The fair value of sales-based payments is based upon probability-weighted future revenue estimates, and increases as revenue estimates increase.  See Note 7 for additional information regarding contingent payments related to acquisitions.

The following table provides a reconciliation of the beginning and ending balances of items measured at fair value on a recurring basis in the tables above that used significant unobservable inputs (Level 3) (in millions):

	Level 3 - Liabilities
Contingent payments related to acquisitions
Beginning balance December 31, 2020	$	48.2
Change in estimate		2.0
Settlements		(6.8	)
Foreign currency impact		(0.3	)
Ending balance June 30, 2021	$	43.1

Changes in estimates for contingent payments related to acquisitions are recognized in Acquisition, integration, divestiture and related expenses on our condensed consolidated statements of earnings.

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Derivative Instruments and Hedging Activities

6 Months Ended

Jun. 30, 2021

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

13.  Derivative Instruments and Hedging Activities

We are exposed to certain market risks relating to our ongoing business operations, including foreign currency exchange rate risk, commodity price risk, interest rate risk and credit risk.  We manage our exposure to these and other market risks through regular operating and financing activities.  Currently, the only risks that we manage through the use of derivative instruments are interest rate risk and foreign currency exchange rate risk.

Interest Rate Risk

Derivatives Designated as Fair Value Hedges

We currently use fixed-to-variable interest rate swaps to manage our exposure to interest rate risk from our cash investments and debt portfolio.  These derivative instruments are designated as fair value hedges under GAAP. Changes in the fair value of the derivative instrument are recorded in current earnings and are offset by gains or losses on the underlying debt instrument.

In June 2021, we entered into $1 billion of fixed-to-variable interest rate swaps that we have designated as fair value hedges of $1 billion of our fixed rate debt obligations.

In prior years, we entered into various fixed-to-variable interest rate swap agreements that were accounted for as fair value hedges of our senior notes due 2021.  In August 2016, we received cash for these interest rate swap assets by terminating the hedging instruments with the counterparties.  The remaining unamortized balance as of June 30, 2021 related to these discontinued hedges was $1.4 million, which will be recognized using the effective interest rate method over the remaining maturity period of the hedged notes.  As of June 30, 2021 and December 31, 2020, the following amounts were recorded on our condensed consolidated balance sheets related to cumulative basis adjustments for fair value hedges (in millions):

	Carrying Amount of the Hedged Liabilities				Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities
Balance Sheet Line Item	June 30, 2021		December 31, 2020		June 30, 2021		December 31, 2020
Current portion of long-term debt	$	301.4	$	303.0	$	1.4	$	3.1
Long-term debt		995.7		-		0.1		-

Derivatives Designated as Cash Flow Hedges

In 2014, we entered into forward starting interest rate swaps that were designated as cash flow hedges of our thirty-year tranche of senior notes due 2045 we expected to issue in 2015. The forward starting interest rate swaps mitigated the risk of changes in interest rates prior to the completion of the notes offering.  The interest rate swaps were settled, and the remaining loss to be recognized at June 30, 2021 was $25.6 million, which will be recognized using the effective interest rate method over the remaining maturity period of the hedged notes.

Foreign Currency Exchange Rate Risk

We operate on a global basis and are exposed to the risk that our financial condition, results of operations and cash flows could be adversely affected by changes in foreign currency exchange rates. To reduce the potential effects of foreign currency exchange rate movements on net earnings, we enter into derivative financial instruments in the form of foreign currency exchange forward contracts with major financial institutions. We also designated our Euro Notes as net investment hedges of investments in foreign subsidiaries. We are primarily exposed to foreign currency exchange rate risk with respect to transactions and net assets denominated in Euros, Swiss Francs, Japanese Yen, British Pounds, Canadian Dollars, Australian Dollars, Korean Won, Swedish Krona, Czech Koruna, Thai Baht, Taiwan Dollars, South African Rand, Russian Rubles, Indian Rupees, Turkish Lira, Polish Zloty, Danish Krone, and Norwegian Krone. We do not use derivative financial instruments for trading or speculative purposes.

Derivatives Designated as Net Investment Hedges

We are exposed to the impact of foreign exchange rate fluctuations in the investments in our wholly-owned foreign subsidiaries that are denominated in currencies other than the U.S. Dollar. In order to mitigate the volatility in foreign exchange rates, we issued Euro Notes in December 2016 and November 2019 and designated 100 percent of the Euro Notes to hedge our net investment in certain wholly-owned foreign subsidiaries that have a functional currency of the Euro. All changes in the fair value of a hedging instrument designated as a net investment hedge are recorded as a component of AOCI in the condensed consolidated balance sheets.  

At June 30, 2021, we had receive-fixed-rate, pay-fixed-rate cross-currency interest swaps with notional amounts outstanding of Euro 775 million, Japanese Yen 7 billion and Swiss Franc 50 million.  These transactions further hedge our net investment in certain wholly-owned foreign subsidiaries that have a functional currency of Euro, Japanese Yen and Swiss Franc.  All changes in the fair

value of a derivative instrument designated as a net investment hedge are recorded as a component of AOCI in the condensed consolidated balance sheets.  The portion of this change related to the excluded component will be amortized into earnings over the life of the derivative while the remainder will be recorded in AOCI until the hedged net investment is sold or substantially liquidated.  We recognize the excluded component in interest expense, net on our condensed consolidated statements of earnings.  The net cash received related to the receive-fixed-rate, pay-fixed-rate component of the cross-currency interest rate swaps is reflected in investing cash flows in our condensed consolidated statements of cash flows.  In the six-month period ended June 30, 2021, Euro 675 million of these cross-currency interest rate swaps matured at a loss of $37.1 million.  The settlement of this loss with the counterparties is reflected in investing cash flows in our condensed consolidated statements of cash flows and will remain in AOCI on our condensed consolidated balance sheet until the hedged net investment is sold or substantially liquidated.

Derivatives Designated as Cash Flow Hedges

Our revenues are generated in various currencies throughout the world.  However, a significant amount of our inventory is produced in U.S. Dollars.  Therefore, movements in foreign currency exchange rates may have different proportional effects on our revenues compared to our cost of products sold.  To minimize the effects of foreign currency exchange rate movements on cash flows, we hedge intercompany sales of inventory expected to occur within the next 30 months with foreign currency exchange forward contracts.  We designate these derivative instruments as cash flow hedges.  

We perform quarterly assessments of hedge effectiveness by verifying and documenting the critical terms of the hedge instrument and confirming that forecasted transactions have not changed significantly.  We also assess on a quarterly basis whether there have been adverse developments regarding the risk of a counterparty default.  For derivatives which qualify as hedges of future cash flows, the gains and losses are temporarily recorded in AOCI and then recognized in cost of products sold when the hedged item affects net earnings.  On our condensed consolidated statements of cash flows, the settlements of these cash flow hedges are recognized in operating cash flows.

For foreign currency exchange forward contracts and options outstanding at June 30, 2021, we had obligations to purchase U.S. Dollars and sell Euros, Japanese Yen, British Pounds, Canadian Dollars, Australian Dollars, Korean Won, Swedish Krona, Czech Koruna, Thai Baht, Taiwan Dollars, South African Rand, Russian Rubles, Indian Rupees, Polish Zloty, Danish Krone, and Norwegian Krone and obligations to purchase Swiss Francs and sell U.S. Dollars. These derivatives mature at dates ranging from July 2021 through December 2023. As of June 30, 2021, the notional amounts of outstanding forward contracts and options entered into with third parties to purchase U.S. Dollars were $1,459.1 million. As of June 30, 2021, the notional amounts of outstanding forward contracts and options entered into with third parties to purchase Swiss Francs were $324.0 million.

Derivatives Not Designated as Hedging Instruments

We enter into foreign currency forward exchange contracts with terms of one month to manage currency exposures for monetary assets and liabilities denominated in a currency other than an entity’s functional currency.  As a result, any foreign currency re-measurement gains/losses recognized in earnings are generally offset with gains/losses on the foreign currency forward exchange contracts in the same reporting period.  The net amount of these offsetting gains/losses is recorded in other expense, net.  These contracts are settled on the last day of each reporting period.  Therefore, there is no outstanding balance related to these contracts recorded on the balance sheet as of the end of the reporting period.  The notional amounts of these contracts are typically in a range of $1.5 billion to $2.0 billion per quarter.

Income Statement Presentation

Derivatives Designated as Cash Flow Hedges

Derivative instruments designated as cash flow hedges had the following effects, before taxes, on AOCI and net earnings on our condensed consolidated statements of earnings, condensed consolidated statements of comprehensive income (loss) and condensed consolidated balance sheets (in millions):

	Amount of Gain (Loss)										Amount of Gain (Loss)
	Recognized in AOCI										Reclassified from AOCI
	Three Months Ended					Six Months Ended					Three Months Ended						Six Months Ended
	June 30,					June 30,				Location on	June 30,						June 30,
Derivative Instrument	2021		2020			2021		2020		Statements of Earnings	2021			2020			2021			2020
Foreign exchange    forward contracts	$	0.4	$	(27.6	)	$	47.9	$	38.1	Cost of products sold	$	(2.6	)	$	15.1		$	(1.5	)	$	30.7
Forward starting    interest rate swaps		-		-			-		-	Interest expense, net		(0.2	)		(0.1	)		(0.3	)		(0.3	)
	$	0.4	$	(27.6	)	$	47.9	$	38.1		$	(2.8	)	$	15.0		$	(1.8	)	$	30.4

The fair value of outstanding derivative instruments designated as cash flow hedges and recorded on our condensed consolidated balance sheet at June 30, 2021, together with settled derivatives where the hedged item has not yet affected earnings, was a net unrealized loss of $20.4 million, or $11.7 million after taxes, which is deferred in AOCI.  A loss of $4.4 million, or $4.0 million after taxes, is expected to be reclassified to earnings in cost of products sold and a loss of $0.6 million, or $0.5 million after taxes, is expected to be reclassified to earnings in interest expense, net over the next twelve months.

The following table presents the effect of fair value, cash flow and net investment hedge accounting on our condensed consolidated statements of earnings (in millions):

	Location and Amount of Gain/(Loss) Recognized in Income on Fair Value, Cash Flow and Net Investment Hedging Relationships for the Period Ended:
	Three Months Ended						Three Months Ended					Six Months Ended						Six Months Ended
	June 30, 2021						June 30, 2020					June 30, 2021						June 30, 2020
	Cost of			Interest			Cost of		Interest			Cost of			Interest			Cost of		Interest
	Products			Expense,			Products		Expense,			Products			Expense,			Products		Expense,
	Sold			Net			Sold		Net			Sold			Net			Sold		Net
Total amounts of income and expense line items presented in the statements of earnings in which the effects of fair value, cash flow and net investment hedges are recorded	$	581.6		$	(54.7	)	$	424.5	$	(54.0	)	$	1,098.0		$	(107.0	)	$	911.6	$	(104.9	)
The effects of fair value, cash flow and net investment hedging:
Gain on fair value hedging                   relationships
Discontinued interest rate swaps		-			0.8			-		0.8			-			1.7			-		1.7
Gain (loss) on cash flow hedging                   relationships
Foreign exchange forward contracts		(2.6	)		-			15.1		-			(1.5	)		-			30.7		-
Forward starting interest rate swaps		-			(0.2	)		-		(0.1	)		-			(0.3	)		-		(0.3	)
Gain on net investment hedging                   relationships
Cross-currency interest rate swaps		-			10.4			-		13.4			-			23.8			-		26.8

Derivatives Not Designated as Hedging Instruments

The following (losses)/gains from these derivative instruments were recognized on our condensed consolidated statements of earnings (in millions):

		Three Months Ended						Six Months Ended
	Location on	June 30,						June 30,
Derivative Instrument	Statements of Earnings	2021			2020			2021			2020
Foreign exchange forward contracts	Other expense, net	$	(1.4	)	$	(7.7	)	$	(7.7	)	$	15.4

These (losses)/gains do not reflect offsetting gains of $0.9 million in the three-month period ended June 30, 2021, offsetting gains of $1.6 million in the three-month period ended June 30, 2020, offsetting gains of $4.3 million in the six-month period ended June 30, 2021, and offsetting losses of $21.9 million in the six-month period ended June 30, 2020, recognized in other income, net as a result of foreign currency re-measurement of monetary assets and liabilities denominated in a currency other than an entity’s functional currency.

Balance Sheet Presentation

As of June 30, 2021 and December 31, 2020, all derivatives designated as fair value hedges, cash flow hedges and net investment hedges are recorded at fair value on our condensed consolidated balance sheets.  On our condensed consolidated balance sheets, we recognize individual forward contracts with the same counterparty on a net asset/liability basis if we have a master netting agreement with the counterparty.  Under these master netting agreements, we are able to settle derivative instrument assets and liabilities with the same counterparty in a single transaction, instead of settling each derivative instrument separately.  We have master netting agreements with all of our counterparties.  The fair value of derivative instruments on a gross basis is as follows (in millions):  

	As of June 30, 2021			As of December 31, 2020
	Balance			Balance
	Sheet	Fair		Sheet	Fair
	Location	Value		Location	Value
Asset Derivatives Designated as Hedges
Foreign exchange forward contracts	Other current assets	$	22.0	Other current assets	$	12.2
Cross-currency interest rate swaps	Other current assets		0.5	Other current assets		-
Foreign exchange forward contracts	Other assets		13.8	Other assets		3.7
Cross-currency interest rate swaps	Other assets		4.2	Other assets		-
Interest rate swaps	Other assets		0.8	Other assets		-
Total asset derivatives		$	41.3		$	15.9
Asset Derivatives Not Designated as Hedges
Foreign exchange forward contracts	Other current assets	$	-	Other current assets	$	1.5
Liability Derivatives Designated as Hedges
Foreign exchange forward contracts	Other current liabilities	$	23.1	Other current liabilities	$	37.4
Cross-currency interest rate swaps	Other current liabilities		8.3	Other current liabilities		55.0
Foreign exchange forward contracts	Other long-term liabilities		8.9	Other long-term liabilities		26.5
Cross-currency interest rate swaps	Other long-term liabilities		5.1	Other long-term liabilities		28.3
Interest rate swaps	Other long-term liabilities		0.7	Other long-term liabilities		-
Total liability derivatives		$	46.1		$	147.2
Liability Derivatives Not Designated as Hedges
Foreign exchange forward contracts	Other current liabilities	$	-	Other current liabilities	$	3.8

The table below presents the effects of our master netting agreements on our condensed consolidated balance sheets (in millions):

		As of June 30, 2021						As of December 31, 2020
Description	Location	Gross Amount		Offset		Net Amount in Balance Sheet		Gross Amount		Offset		Net Amount in Balance Sheet
Asset Derivatives
Cash flow hedges	Other current assets	$	22.0	$	13.6	$	8.4	$	12.2	$	11.7	$	0.5
Cash flow hedges	Other assets		13.8		6.3		7.5		3.7		3.7		-
Derivatives Not Designated as Hedges	Other current assets		-		-		-		1.5		0.6		0.9
Liability Derivatives
Cash flow hedges	Other current liabilities		23.1		13.6		9.5		37.4		11.7		25.7
Cash flow hedges	Other long-term liabilities		8.9		6.3		2.6		26.5		3.7		22.8
Derivatives Not Designated as Hedges	Other current liabilities		-		-		-		3.8		0.6		3.2

The following net investment hedge gains (losses) were recognized on our condensed consolidated statements of comprehensive income (loss) (in millions):

	Amount of Gain (Loss)
	Recognized in AOCI
	Three Months Ended						Six Months Ended
	June 30,						June 30,
Derivative Instrument	2021			2020			2021		2020
Euro Notes	$	(15.9	)	$	(39.0	)	$	56.4	$	(0.9	)
Cross-currency interest rate swaps		(28.1	)		(41.6	)		37.5		28.1
	$	(44.0	)	$	(80.6	)	$	93.9	$	27.2

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Income Taxes

6 Months Ended

Jun. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

14.  Income Taxes

We operate on a global basis and are subject to numerous and complex tax laws and regulations.  Additionally, tax laws continue to undergo rapid changes in both application and interpretation by various countries, including state aid interpretations and initiatives led by the Organization for Economic Cooperation and Development.  Our income tax filings are subject to examinations by taxing authorities throughout the world. Income tax audits may require an extended period of time to reach resolution and may result in significant income tax adjustments when interpretation of tax laws or allocation of company profits is disputed.  Although ultimate timing is uncertain, the net amount of tax liability for unrecognized tax benefits may change within the next twelve months due to changes in audit status, expiration of statutes of limitations, settlements of tax assessments and other events.  Management’s best estimate of such change is within the range of a $250 million decrease to a $20 million increase.

We are under continuous audit by the IRS and other taxing authorities.  During the course of these audits, we receive proposed adjustments from taxing authorities that may be material.  Therefore, there is a possibility that an adverse outcome in these audits could have a material effect on our results of operations and financial condition.  Our U.S. Federal income tax returns have been audited through 2015 and are currently under audit for years 2016-2019.   

In October 2020, we reached agreement with the IRS for tax years 2006-2012 related to the reallocation of profits between the U.S. and Puerto Rico as well as other miscellaneous adjustments.  

The IRS has proposed adjustments for tax years 2010-2012, primarily related to reallocating profits between certain of our U.S. and foreign subsidiaries, which remain unsettled.  We have disputed these adjustments and intend to continue to vigorously defend our positions as we pursue resolution through the administrative process with the IRS Independent Office of Appeals.  

The IRS has proposed adjustments for tax years 2013-2015 relating to transfer pricing involving our cost sharing agreement between the U.S. and Switzerland affiliated companies and reallocating profits between certain of our U.S. and foreign subsidiaries.  This includes a proposed increase to our U.S. Federal taxable income, which would result in additional tax expense related to 2013 of approximately $370 million, subject to interest and penalties related to our cost sharing agreement.  We strongly believe that the position of the IRS, with regard to this matter, is inconsistent with the applicable U.S. Treasury regulations governing our cost sharing agreement.  We do not expect changes to our reserves relative to these matters within the next twelve months.  We intend to vigorously contest the adjustment, and we will pursue all available administrative and, if necessary, judicial remedies.  If we pursue judicial remedies in the U.S. Tax Court for years 2013-2015, a number of years will likely elapse before such matters are finally resolved.  No payment of any amount related to this matter is required to be made, if at all, until all applicable proceedings have been completed.  

A public referendum held in Switzerland passed the Federal Act on Tax Reform and AHV Financing (“TRAF”), effective January 1, 2020.  The TRAF provides transitional relief measures for companies that are losing the tax benefit of a ruling, including a "step-up" for amortizable goodwill, equal to the amount of future tax benefit they would have received under their existing ruling, subject to certain limitations.  This resulted in the recording of a deferred tax asset for future deductions of tax goodwill. For the six-month period ended June 30, 2021, we recognized benefits of $10.0 million related to certain adjustments to the estimated net deferred tax asset from the filing of tax returns.  

In the three and six-month periods ended June 30, 2021, our effective tax rate (“ETR”) was 18.0 percent and 13.8 percent, respectively, compared to 6.2 percent and 1.2 percent in the three and six-month periods ended June 30, 2020, respectively.  The 18.0 percent ETR in the three-month period ended June 30, 2021, was primarily due to our mix of earnings between U.S. and foreign locations.  The 13.8 percent ETR in the six-month period ended June 30, 2021, was the result of favorable discrete adjustments from the filing of Swiss tax returns and an excess tax benefit related to stock-based compensation.  The 6.2 percent ETR in the three-month period ended June 30, 2020, was the result of the mix of some of our jurisdictions recognizing earnings while others had losses. The 1.2 percent ETR in the six-month period ended June 30, 2020, was primarily due to the $612.0 million goodwill impairment charge, which resulted in a loss before taxes, but has no corresponding tax benefit, as well as the mix of earnings and losses among our jurisdictions.  Absent discrete tax events, we expect our future ETR will be lower than the U.S. corporate income tax rate of 21.0 percent due to our mix of earnings between U.S. and foreign locations, which have lower corporate income tax rates.  Our ETR in future periods could also potentially be impacted by: changes in our mix of pre-tax earnings; changes in tax rates, tax laws or their interpretation; the outcome of various federal, state and foreign audits; and the expiration of certain statutes of limitations.  Currently, we cannot reasonably estimate the impact of these items on our financial results.

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Earnings Per Share

6 Months Ended

Jun. 30, 2021

Earnings Per Share [Abstract]

Earnings Per Share

15.  Earnings Per Share

The following is a reconciliation of weighted average shares for the basic and diluted shares computations (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Weighted average shares outstanding for basic net earnings (loss) per share		208.6		206.8		208.3		206.6
Effect of dilutive stock options and other equity awards		2.1		-		2.1		-
Weighted average shares outstanding for diluted net earnings (loss) per share		210.7		206.8		210.4		206.6

During each of the three and six-month periods ended June 30, 2021, an average of 0.4 million options to purchase shares of common stock were not included in the computation of diluted earnings per share because the exercise prices of these options were greater than the average market price of our common stock.   Since we incurred a net loss in the three and six-month periods ended June 30, 2020, no dilutive stock options or other equity awards were included as diluted shares.

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Segment Information

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Information

16.  Segment Information

We design, manufacture and market orthopedic reconstructive products; sports medicine, biologics, extremities and trauma products; spine, craniomaxillofacial and thoracic products (“CMFT”); office based technologies; dental implants; and related surgical products.  Our chief operating decision maker (“CODM”) allocates resources to achieve our operating profit goals through four operating segments.  These operating segments, which also constitute our reportable segments, are Americas Orthopedics; EMEA; Asia Pacific; and Americas Spine and Global Dental.  

As a result of changes to our organizational structure in advance of the planned spin off of SpinCo that were effective April 1, 2021, we added an additional operating segment to reflect a change in how our CODM allocates resources to achieve our operating profit goals.  The new operating segment consists of the Americas Spine and Global Dental businesses, which was carved out of the previous Americas and Global Businesses operating segment (subsequently renamed to Americas Orthopedics).  The EMEA and Asia Pacific operating segments still include the spine product category results in those regions and therefore did not change.  

Additionally, starting April 1, 2021 the financial information provided to the CODM from the Americas Orthopedics excluded certain costs related to operations, distribution, quality assurance and regulatory assurance that had previously been reported within this segment.  This group of functions and related costs do not meet the criteria to be a separate operating segment and are now reported within Corporate functions.  

We have reclassified previously reported information related to the change in operating segments and Corporate functions, along with other insignificant changes, to conform to the new presentation.

Our CODM evaluates performance based upon segment operating profit exclusive of operating expenses pertaining to inventory and manufacturing-related charges, intangible asset amortization, goodwill and intangible asset impairment, restructuring and other cost reduction initiatives, quality remediation, acquisition, integration, divestiture and related, litigation, certain European Union Medical Device Regulation (“EU MDR”) expenses, certain R&D agreements, other charges and corporate functions.  Corporate functions include corporate legal, finance, information technology, human resources and other corporate departments as well as certain operations, distribution, quality assurance and regulatory assurance expenses.  Intercompany transactions have been eliminated from segment operating profit.

Our Americas Orthopedics operating segment is comprised principally of the U.S. and includes other North, Central and South American markets for our orthopedic product categories.  This segment also includes research, development engineering, medical education, and brand management for our orthopedic product category headquarter locations.  Our EMEA operating segment is comprised principally of Europe and includes the Middle East and African markets for all product categories except Dental.  Our Asia Pacific operating segment is comprised principally of Japan, China and Australia and includes other Asian and Pacific markets for all product categories except Dental.  The EMEA and Asia Pacific operating segments include the commercial operations as well as regional headquarter expenses to operate in those markets.  The Americas Spine and Global Dental segment is comprised principally of the U.S. and includes other North, Central and South American markets for our spine business, and all geographic markets for our dental business.  This segment also includes research, development engineering, medical education and brand management at the product category headquarter locations as well as other directly attributable distribution and operations expenses.  

Since the Americas Orthopedics segment includes additional costs related to centralized orthopedic product category headquarter expenses, profitability metrics in this operating segment are not comparable to the EMEA and Asia Pacific operating segments.  Similarly, since the Americas Spine and Global Dental segment also includes research, development engineering, medical education, and brand management at the product category headquarter locations as well as other directly attributable distribution and operations expenses, its profitability metrics are not comparable to the other operating segments.  

Our CODM does not review asset information by operating segment.  Instead, our CODM reviews cash flow and other financial ratios by operating segment.

Net sales and operating profit by segment are as follows (in millions):

	Net Sales				Operating Profit (Loss)
	Three Months Ended				Three Months Ended
	June 30,				June 30,
	2021		2020		2021			2020
Americas Orthopedics	$	1,058.3	$	626.5	$	445.4		$	203.7
EMEA		392.9		204.1		95.2			20.1
Asia Pacific		345.7		264.5		111.4			78.4
Americas Spine and Global Dental		230.0		131.0		40.1			(3.4	)
Total	$	2,026.9	$	1,226.1
Corporate Functions						(162.0	)		(229.0	)
Inventory and manufacturing-related charges						(7.9	)		(1.4	)
Intangible asset amortization						(154.6	)		(147.7	)
Goodwill and intangible asset impairment						(16.3	)		(33.0	)
Restructuring and other cost reduction initiatives						(19.7	)		(28.0	)
Quality remediation						(11.0	)		(9.9	)
Acquisition, integration, divestiture and related						(25.4	)		(2.2	)
Litigation						(3.6	)		(1.3	)
European Union Medical Device Regulation						(10.6	)		(6.1	)
Certain R&D agreements						(65.0	)		-
Other charges						4.5			(11.9	)
Operating profit (loss)					$	220.5		$	(171.7	)

	Net Sales				Operating Profit (Loss)
	Six Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021			2020
Americas Orthopedics	$	2,004.5	$	1,569.5	$	832.5		$	607.0
EMEA		742.0		575.4		181.5			128.9
Asia Pacific		682.6		540.4		231.7			171.0
Americas Spine and Global Dental		445.2		324.6		79.1			22.5
Total	$	3,874.3	$	3,009.9
Corporate Functions						(318.4	)		(393.4	)
Inventory and manufacturing-related charges						(2.0	)		(2.0	)
Intangible asset amortization						(310.1	)		(295.3	)
Goodwill and intangible asset impairment						(16.3	)		(645.0	)
Restructuring and other cost reduction initiatives						(41.6	)		(73.0	)
Quality remediation						(21.2	)		(25.8	)
Acquisition, integration, divestiture and related						(38.8	)		(6.6	)
Litigation						(9.7	)		(81.1	)
European Union Medical Device Regulation						(17.5	)		(17.1	)
Certain R&D agreements						(65.0	)	-
Other charges						1.9			(17.8	)
Operating profit (loss)					$	486.1		$	(627.7	)

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

17.  Commitments and Contingencies

On a quarterly and annual basis, we review relevant information with respect to loss contingencies and update our accruals, disclosures and estimates of reasonably possible losses or ranges of loss based on such reviews.  We establish liabilities for loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.  For matters where a loss is believed to be reasonably possible, but not probable, no accrual has been made.

Litigation

Durom Cup-related claims:  On July 22, 2008, we temporarily suspended marketing and distribution of the Durom Cup in the U.S.  Subsequently, a number of product liability lawsuits were filed against us in various U.S. and foreign jurisdictions.  The plaintiffs seek damages for personal injury, and they generally allege that the Durom Cup contains defects that result in complications and premature revision of the device.  We have settled the majority of these claims and others are still pending.  The majority of the pending U.S. lawsuits are currently in a federal Multidistrict Litigation (“MDL”) in the District of New Jersey (In Re: Zimmer Durom Hip Cup Products Liability Litigation).  Litigation activity in the MDL is stayed pending finalization of the U.S. Durom Cup Settlement Program, an extrajudicial program created to resolve actions and claims of eligible U.S. plaintiffs and claimants.  Other lawsuits are pending in various domestic and foreign jurisdictions, and additional claims may be asserted in the future.  The majority of claims outside the U.S. are pending in Germany, Netherlands and Italy.

Our estimate as of June 30, 2021 of the remaining liability for all Durom Cup-related claims, including estimated legal fees, is $47.9 million.  

Our understanding of clinical outcomes with the Durom Cup and other large diameter hip cups continues to evolve.  We rely on significant estimates in determining the provisions for Durom Cup-related claims, including our estimate of the number of claims that we will receive and the average amount we will pay per claim.  The actual number of claims and the actual amount we pay per claim may differ from our estimates.  Among other factors, since our understanding of the clinical outcomes is still evolving, we cannot reasonably estimate the possible loss or range of loss that may result from Durom Cup-related claims in excess of the losses we have accrued.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

Zimmer M/L Taper, M/L Taper with Kinectiv Technology, and Versys Femoral Head-related claims (“Metal Reaction” claims): We are a defendant in a number of product liability lawsuits relating to our M/L Taper and M/L Taper with Kinectiv Technology hip stems, and Versys Femoral Head implants.  The plaintiffs seek damages for personal injury, alleging that defects in the products lead to corrosion at the head/stem junction resulting in, among other things, pain, inflammation and revision surgery. 

The majority of the cases are consolidated in an MDL that was created on October 3, 2018 in the U.S. District Court for the Southern District of New York (In Re: Zimmer M/L Taper Hip Prosthesis or M/L Taper Hip Prosthesis with Kinectiv Technology and Versys Femoral Head Products Liability Litigation).  Other related cases are pending in various state and federal courts.  Additional lawsuits are likely to be filed.  Our estimate as of June 30, 2021 of the remaining liability for all Metal Reaction-related claims, including our estimated legal fees, is $49.2 million.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

Biomet metal-on-metal hip implant claims:  Biomet is a defendant in a number of product liability lawsuits relating to metal-on-metal hip implants, most of which involve the M2a-Magnum hip system.  Cases are currently consolidated in an MDL in the U.S. District Court for the Northern District of Indiana (In Re: Biomet M2a Magnum Hip Implant Product Liability Litigation) and in various state, federal and foreign courts, with the majority of domestic state court cases pending in Indiana and Florida.

On February 3, 2014, Biomet announced the settlement of the MDL.  Lawsuits filed in the MDL by April 15, 2014 were eligible to participate in the settlement.  Those claims that did not settle via the MDL settlement program have re-commenced litigation in the MDL under a new case management plan, or have been or are in the process of being remanded to their originating jurisdictions.  The settlement does not affect certain other claims relating to Biomet’s metal-on-metal hip products that are pending in various state and foreign courts, or other claims that may be filed in the future.  Trials have commenced, and other trials are currently scheduled to occur in the future.  Although each case will be tried on its particular facts, a verdict and subsequent final judgment for the plaintiff in one or more of these cases could have a substantial impact on our potential liability.  Our estimate as of June 30, 2021 of the remaining liability for all Biomet metal-on-metal hip implant claims, including estimated legal fees, is $69.5 million.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

Heraeus trade secret misappropriation lawsuits:  In December 2008, Heraeus Kulzer GmbH (together with its affiliates, “Heraeus”) initiated legal proceedings in Germany against Biomet, Inc., Biomet Europe BV (now Zimmer Biomet Nederland BV), certain other entities and certain employees alleging that the defendants misappropriated Heraeus trade secrets when developing Biomet Europe’s Refobacin and Biomet Bone Cement line of cements (“European Cements”).  The lawsuit sought to preclude the defendants from producing, marketing and offering for sale their then-current line of European Cements and to compensate Heraeus for any damages incurred.

Germany: On June 5, 2014, the German appeals court in Frankfurt (i) enjoined Biomet, Inc., Biomet Europe BV and Biomet Deutschland GmbH from manufacturing, selling or offering the European Cements to the extent they contain certain raw materials in particular specifications; (ii) held the defendants jointly and severally liable to Heraeus for any damages from the sale of European Cements since 2005; and (iii) ruled that no further review may be sought (the “Frankfurt Decision”).  The Heraeus and Biomet parties both sought appeal against the Frankfurt Decision.  In a decision dated June 16, 2016, the German Supreme Court dismissed the parties’ appeals without reaching the merits, rendering that decision final.

In December 2016, Heraeus filed papers to restart proceedings against Biomet Orthopaedics Switzerland GmbH (now Zimmer GmbH), seeking to require that entity to relinquish its CE certificates for the European Cements.  In January 2017, Heraeus notified Biomet it had filed a claim for damages in the amount of €121.9 million for sales in Germany, which it first increased to €125.9 million and with a filing in June 2019 further increased to €146.7 million plus statutory interest.  In a court filing, Heraeus indicated that it might further increase its claims in the course of the proceedings.  As of June 30, 2021, these two proceedings remained pending in front of the Darmstadt court.  In September 2017, Heraeus filed an enforcement action in the Darmstadt court against Biomet Europe (now Zimmer Biomet Nederland B.V.), requesting that a fine be imposed against Biomet Europe for failure to disclose the amount of the European Cements which Biomet Orthopaedics Switzerland had ordered to be manufactured in Germany (e.g., for the Chinese market).  In June 2018, the Darmstadt court dismissed Heraeus’ request.  Heraeus appealed the decision.  The appeal remained pending as of June 30, 2021.  Also in September 2017, Heraeus filed suit against Zimmer Biomet Deutschland in the court of first instance in Freiburg concerning the sale of the European Cements with certain changed raw materials.  Heraeus sought an injunction on the basis that the continued use of the product names for the European Cements was misleading for customers and thus an act of unfair competition.  On June 29, 2018, the court in Freiburg, Germany dismissed Heraeus’ request for an injunction prohibiting the marketing of the European Cements under their current names on the grounds that the same request had already been decided upon by the Frankfurt Decision which became final and binding.  Heraeus appealed this decision to the Court of Appeals in Karlsruhe, Germany.  The appeals hearing occurred in December 2019 and on June 19, 2020, the court dismissed the appeal on different grounds, namely that the appeals court did not find any unfair competition in the continued use of the product names.  Although the appeals court did not grant leave to appeal, Heraeus had initially filed a request for appeal with the German Supreme Court, but it withdrew that request in November 2020.

United States: On September 8, 2014, Heraeus filed a complaint against a Biomet supplier, Esschem, Inc. (“Esschem”), in the U.S. District Court for the Eastern District of Pennsylvania.  The lawsuit contained allegations that focused on two copolymer compounds that Esschem sold to Biomet, which Biomet incorporated into certain bone cement products that compete with Heraeus’ bone cement products.  The complaint alleged that Biomet helped Esschem to develop these copolymers, using Heraeus trade secrets that Biomet allegedly misappropriated.  The complaint asserted a claim under the Pennsylvania Uniform Trade Secrets Act, as well as other various common law tort claims, all based upon the same trade secret misappropriation theory.  Heraeus sought to enjoin Esschem from supplying the copolymers to any third party and actual damages.  The complaint also sought punitive damages, costs and attorneys’ fees.  Although Biomet was not a party to this lawsuit, Biomet agreed, at Esschem’s request and subject to certain limitations, to indemnify Esschem for any liability, damages and legal costs related to this matter.  On November 3, 2014, the court entered an order denying Heraeus’ motion for a temporary restraining order.  On June 30, 2016, the court entered an order denying Heraeus’ request to give preclusive effect to the factual findings in the Frankfurt Decision.  On June 6, 2017, the court entered an order denying Heraeus’ motion to add Biomet as a party to the lawsuit.  On January 26, 2018, the court entered an order granting Esschem’s motion for summary judgment and dismissed all of Heraeus’ claims with prejudice.  On February 21, 2018, Heraeus filed a notice of appeal to the U.S. Court of Appeals for the Third Circuit, which heard oral argument on the appeal on October 23, 2018.  On June 21, 2019, the Third Circuit partially reversed the decision of the U.S. District Court for the Eastern District of Pennsylvania granting Esschem summary judgment and remanded the case back to the lower court.  On July 5, 2019, Esschem filed a petition in the Third Circuit for rehearing en banc and a motion in the alternative to certify a question of state law to the Supreme Court of Pennsylvania, which was denied on August 1, 2019.  On January 8, 2021, the court entered a scheduling order for the completion of fact and expert discovery and filing of dispositive motions but did not set a trial date.

On December 7, 2017, Heraeus filed a complaint against Zimmer Biomet Holdings, Inc. and Biomet, Inc. in the U.S. District Court for the Eastern District of Pennsylvania alleging a single claim of trade secret misappropriation under the Pennsylvania Uniform Trade Secrets Act based on the same factual allegations as the Esschem litigation.  On March 5, 2018, Heraeus filed an amended complaint adding a second claim of trade secret misappropriation under Pennsylvania common law.  Heraeus seeks to enjoin the Zimmer Biomet parties from future use of the allegedly misappropriated trade secrets and recovery of unspecified damages for alleged past use.  On April 18, 2018, the Zimmer Biomet parties filed a motion to dismiss both claims.  On March 8, 2019, the court stayed the case pending the Third Circuit’s decision in the Esschem case described above.  In September 2019, the Zimmer Biomet parties filed a motion to stay the proceedings pending (1) the court’s decision on Esschem’s motion for summary judgment in the Esschem case described above and (2) the outcome of a U.S. International Trade Commission (“ITC”) complaint filed by Heraeus asserting similar claims.  On May 2, 2020, the court granted the Zimmer Biomet parties’ motion to stay the proceedings pending the outcome of the ITC complaint filed by Heraeus.  The related ITC investigation is complete.  In June 2021, Heraeus filed a motion to lift the stay of proceedings and attached a draft motion for preliminary injunction enjoining Zimmer Biomet from continuing to manufacture and sell its bone cements.  As of June 30, 2021, the court has not dissolved the stay.  Although we are vigorously defending this lawsuit, the ultimate outcome is uncertain.  An adverse ruling in this case could have a material adverse effect on our business, financial condition and results of operations.

Other European Countries: Heraeus continues to pursue other related legal proceedings in Europe seeking various forms of relief, including injunctive relief and damages, against various Biomet-related and local Zimmer Biomet entities relating to the European Cements, including those described herein.  On October 2, 2018, the Belgian Court of Appeal of Mons issued a judgment in favor of Heraeus relating to its request for past damages caused by the alleged misappropriation of its trade secrets, and an injunction preventing future sales of certain European Cements in Belgium (the “Belgian Decision”).  We appealed this judgment to the Belgian Supreme Court.  The Belgian Supreme Court dismissed our appeal in October 2019 and this decision is final.  Proceedings to assess the amount of damages potentially owed to Heraeus under the Belgian Decision remain pending.  Heraeus filed a suit in Belgium concerning the continued sale of the European Cements with certain changed materials.  Like its former suit in Germany, Heraeus seeks an injunction on the basis that the continued use of the product names for the European Cements is misleading for customers and thus an act of unfair competition.  On May 7, 2019, the Liège Commercial Court issued a judgment that Zimmer Biomet failed to inform its hospital and surgeon customers of the changes made to the composition of the cement with certain changed materials and ordered, as a sole remedy, that Zimmer Biomet send letters to those customers, which we have done.  An appeals hearing took place on January 13, 2021.  On February 10, 2021, the court of appeals dismissed the appeals of Heraeus and Zimmer Biomet, which ended the unfair competition proceedings regarding the continued use of the product names.  In November 2020, Heraeus also initiated proceedings in Belgium seeking an injunction and damages related to the distribution of the European Cements in the revised formulation.  Heraeus claims that the revised formulation still misappropriates its alleged trade secrets.  The proceedings are pending, and a decision is not expected in 2021.

On February 13, 2019, a Norwegian court of first instance issued a judgment in favor of Heraeus on its claim for misappropriation of trade secrets.  The court awarded damages of 19,500,000 NOK, or approximately $2.3 million, plus attorneys’ fees, and issued an injunction, which was never enforced, preventing Zimmer Biomet Norway from marketing in Norway bone cements identified with the current product names and bone cements making use of the trade secrets which were acknowledged in the Frankfurt Decision.  We appealed the Norwegian judgment to the court of second instance and an appeals trial was held in March 2021.  On April 30, 2021, the appeals court in Norway found in favor of Zimmer Biomet and reversed the decision of the court of first instance.  The appeals court ruled that Heraeus did not substantiate that the alleged trade secrets were useful and thus did not qualify as trade secrets, and additionally determined that the alleged trade secrets were not actually used or misappropriated.  Heraeus sought leave to appeal to the Norwegian supreme court, which the court denied on July 13, 2021.  The decision of the appeals court in favor of Zimmer Biomet is now final.

On October 29, 2019, an Italian court of first instance issued a judgment in favor of Heraeus on its claim of misappropriation of trade secrets, but did not yet order an award of damages.  We filed a timely appeal of the decision and the appellate hearing took place on May 27, 2021.  On July 19, 2021, the court of appeals reopened the case and ordered the appointment of a technical expert so it can ascertain whether the trade secrets enforced by Heraeus are secret according to the law and have been protected by adequate protective measures.  Heraeus has not initiated damages proceedings, but could do so in the future based on the non-final first instance decision.

On January 23, 2020, a Finnish Market Court issued a judgment partly in favor of Heraeus on its claim of misappropriation of certain trade secrets.  Damage claims were not raised in the proceedings.  We appealed the decision to the Finnish Supreme Court.  On July 3, 2020, the Finnish Supreme Court declined to review the case, rendering the Market Court decision final.  In March 2021, Heraeus initiated damages proceedings, claiming damages of €13.84 million, or approximately $16.6 million.

Heraeus is pursuing damages and injunctive relief in France in an effort to prevent us from manufacturing, marketing and selling the European Cements (the “France Litigation”).  The European Cements are manufactured at our facility in Valence, France.  On December 11, 2018, a hearing was held in the France Litigation before the commercial court in Romans-sur-Isère.  On May 23, 2019, the commercial court ruled in our favor.  On July 12, 2019, Heraeus filed an appeal to the court of second instance in Grenoble, France.  Although we are vigorously defending the France Litigation, the ultimate outcome is uncertain.  An adverse ruling in the France Litigation could have a material adverse effect on our business, financial condition and results of operations.

We have accrued an estimated loss relating to the collective trade secret litigation, including estimated legal costs to defend.  Damages relating to the Frankfurt Decision are subject to separate proceedings, and the German and Belgian courts appointed experts to determine the amount of damages related to the Frankfurt and Belgian Decisions, respectively.  Thus, it is reasonably possible that our estimate of the loss we may incur may change in the future.  Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain.

Shareholder Derivative Actions:  On June 14, 2019 and July 29, 2019, two shareholder derivative actions, Green v. Begley et al. and Detectives Endowment Association Annuity Fund v. Begley et al., were filed in the Court of Chancery in the State of Delaware.  On October 2, 2019 and October 11, 2019, two additional shareholder derivative actions, Karp v. Begley et al. and DiGaudio v. Begley et al., were filed in the U.S. District Court for the District of Delaware.  The plaintiff in each action seeks to maintain the action purportedly on our behalf against certain of our current and former directors and officers (the “individual defendants”) and certain former stockholders of ours who sold shares of our common stock in various secondary public offerings in 2016 (the “private equity fund defendants”).  The plaintiff in each action alleges, among other things, breaches of fiduciary duties against the individual defendants and insider trading against two individual defendants and the private equity fund defendants based on factual allegations that the defendants violated federal securities laws by making materially false and/or misleading statements and/or omissions about our compliance with U.S. Food and Drug Administration (“FDA”) regulations and our ability to continue to accelerate our organic revenue growth rate in the second half of 2016.  On June 4, 2020, the plaintiffs in the Chancery Court actions filed a consolidated amended complaint adding three new counts and expanding the scope of the alleged materially false statements.  On September 14, 2020, the defendants filed motions to dismiss the Chancery Court actions.  Oral argument occurred on June 15, 2021.  A decision is expected in late 2021.  Also on September 14, 2020, the plaintiffs in the U.S. District Court actions filed a consolidated amended complaint adding certain details to their allegations.  On October 9, 2020, the U.S. District Court granted the parties’ joint motion to stay the U.S. District Court actions pending resolution of the motions to dismiss the Chancery Court actions.  The plaintiffs in the Chancery Court and the U.S. District Court actions do not seek damages from us, but instead request damages on our behalf from the defendants of an unspecified amount, as well as attorneys’ fees, costs and other relief.  

Regulatory Matters, Government Investigations and Other Matters  

U.S. International Trade Commission Investigation: On March 5, 2019, Heraeus filed a complaint with the ITC against us and certain of our subsidiaries.  The complaint alleges that Biomet misappropriated Heraeus’ trade secrets in the formulation and manufacture of two bone cement products now sold by Zimmer Biomet, both of which are imported from our Valence, France facility.  Heraeus requested that the ITC institute an investigation and, after the investigation, issue a limited exclusion order and cease and desist orders.  On April 5, 2019, the ITC ordered an investigation be instituted into whether we have committed an “unfair act” in the importation, sale for importation, or sale after importation of certain bone cement products, the threat or effect of which is to destroy or substantially injure an industry in the United States, in violation of Section 337 of the Tariff Act of 1930, as amended (“Section 337”).  An evidentiary hearing in front of an administrative law judge at the ITC was held in January 2020 and an Initial Determination was issued on May 6, 2020.  In the Initial Determination, the administrative law judge held that we did not violate Section 337, and thus we are not restricted from continuing to manufacture and sell the two challenged bone cement products in the United States.  On July 13, 2020, the ITC issued a notice of intent to review the Initial Determination and on January 12, 2021 it issued a Final Determination which affirmed the Initial Determination with modifications and terminated the investigation with a finding of no violation of Section 337.  Heraeus did not appeal the Final Determination.

FDA warning letter:  In August 2018, we received a warning letter from the FDA related to observed non-conformities with current good manufacturing practice requirements of the Quality System Regulation (21 CFR Part 820) (“QSR”) at our legacy Biomet manufacturing facility in Warsaw, Indiana (this facility is sometimes referred to in this report as the “Warsaw North Campus”).  We have provided detailed responses to the FDA as to our corrective actions and will continue to work expeditiously to address the issues

identified by the FDA during inspections in Warsaw.  As of June 30, 2021, the Warsaw warning letter remained pending.  Until the violations cited in the pending warning letter are corrected, we may be subject to additional regulatory action by the FDA, as described more fully below.  Additionally, requests for Certificates to Foreign Governments may not be granted and premarket approval applications for Class III devices to which the QSR deviations are reasonably related will not be approved until the violations have been corrected.  In addition to responding to the warning letter described above, we are in the process of addressing various FDA Form 483 inspectional observations at certain of our manufacturing facilities, including observations issued by the FDA following an inspection of the Warsaw North Campus in January 2020, which inspection the FDA has classified as Voluntary Action Indicated (“VAI”).  The ultimate outcome of these matters is presently uncertain.  Among other available regulatory actions, the FDA may impose operating restrictions, including a ceasing of operations, at one or more facilities, enjoining and restraining certain violations of applicable law pertaining to products, seizure of products and assessing civil or criminal penalties against our officers, employees or us.  The FDA could also issue a corporate warning letter or a recidivist warning letter or negotiate the entry of a consent decree of permanent injunction with us.  The FDA may also recommend prosecution by the U.S. Department of Justice.  Any adverse regulatory action, depending on its magnitude, may restrict us from effectively manufacturing, marketing and selling our products and could have a material adverse effect on our business, financial condition and results of operations.

Other Contingencies

Contractual obligations: We have entered into development, distribution and other contractual arrangements that may result in future payments dependent upon various events such as the achievement of certain product R&D milestones, sales milestones, or, at our discretion, maintenance of exclusive rights to distribute a product.  Since there is uncertainty on the timing or whether such payments will have to be made, they have not been recognized on our condensed consolidated balance sheets.  These estimated payments could range from $0 to approximately $380 million.

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2021

Accounting Policies [Abstract]

Use of Estimates

Use of Estimates - The accompanying unaudited condensed consolidated financial statements are prepared in conformity with GAAP, which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  We have made our best estimates, as appropriate under GAAP, in the recognition of our assets and liabilities.  These estimates have considered the impact the COVID-19 pandemic may have on our financial position, results of operations and cash flows.  Such estimates included, but were not limited to, variable consideration to our customers, our allowance for doubtful accounts for expected credit losses, the net realizable value of our inventory, the fair value of our goodwill and the recoverability of other long-lived assets.  Actual results could differ materially from these estimates.

Recent Accounting Pronouncements Policy Policy [Text Block]

Accounting Pronouncements Recently Adopted

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-12 Simplifying the Accounting for Income Taxes.  ASU 2019-12 eliminates certain exceptions in the rules regarding the approach for intraperiod tax allocations and the methodology for calculating income taxes in an interim period, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill, among other things. We adopted this standard as of January 1, 2021. The adoption of this standard did not have a material impact on our financial position, results of operations or cash flows.

Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848).  ASU 2020-04 provides temporary optional guidance to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying generally accepted accounting principles to transactions affected by reference rate reform if certain criteria are met. Early adoption of this ASU is permitted, and we may elect to apply the amendments prospectively through December 31, 2022. We are currently evaluating the impact this ASU will have on our financial statements.

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Revenue (Tables)

6 Months Ended

Jun. 30, 2021

Revenue Recognition [Abstract]

Schedule of Net Sales by Geography

Net sales by geography are as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Americas	$	1,239.6	$	733.7	$	2,354.6	$	1,835.0
EMEA		429.8		218.7		814.0		616.8
Asia Pacific		357.5		273.7		705.7		558.1
Total	$	2,026.9	$	1,226.1	$	3,874.3	$	3,009.9

Schedule of Net Sales by Product Category

Net sales by product category are as follows (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Knees	$	665.6	$	375.0	$	1,279.9	$	1,003.7
Hips		474.6		329.7		921.6		762.3
S.E.T.		462.1		292.7		879.7		673.6
Dental & Spine		263.5		152.3		509.5		371.8
Other		161.1		76.4		283.6		198.5
Total	$	2,026.9	$	1,226.1	$	3,874.3	$	3,009.9

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Restructuring (Tables)

6 Months Ended

Jun. 30, 2021

Restructuring And Related Activities [Abstract]

Summary of Liabilities Recognized Related to Restructuring Plan

The following table summarizes the liabilities recognized related to the 2019 Restructuring Plan (in millions):

	Employee
	Termination			Contract
	Benefits			Terminations			Other			Total
Expenses incurred in the three months ended June 30, 2021	$	1.8		$	1.5		$	12.0		$	15.3
Balance, December 31, 2020	$	38.7		$	10.9		$	15.1		$	64.7
Expenses incurred in the six months ended June 30, 2021		3.4			6.8			24.1			34.3
Cash payments		(8.5	)		(3.6	)		(17.7	)		(29.8	)
Foreign currency exchange rate changes		(0.7	)		-			-			(0.7	)
Balance, June 30, 2021	$	32.9		$	14.1		$	21.5		$	68.5
Expense incurred since the start of the 2019 Restructuring Plan	$	81.9		$	22.6		$	74.3		$	178.8
Expense estimated to be recognized for the 2019 Restructuring Plan	$	180.0		$	25.0		$	170.0		$	375.0

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Inventories (Tables)

6 Months Ended

Jun. 30, 2021

Inventory Disclosure [Abstract]

Summary of Inventories

	June 30,		December 31,
	2021		2020
	(in millions)
Finished goods	$	2,024.0	$	1,954.6
Work in progress		229.5		223.7
Raw materials		279.5		272.4
Inventories	$	2,533.0	$	2,450.7

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Property, Plant and Equipment (Tables)

6 Months Ended

Jun. 30, 2021

Property Plant And Equipment [Abstract]

Summary of Property, Plant and Equipment

	June 30,			December 31,
	2021			2020
	(in millions)
Land	$	27.5		$	27.7
Buildings and equipment		2,266.4			2,197.8
Capitalized software costs		450.9			455.8
Instruments		3,668.3			3,518.3
Construction in progress		110.0			125.3
		6,523.1			6,324.9
Accumulated depreciation		(4,517.9	)		(4,277.2	)
Property, plant and equipment, net	$	2,005.2		$	2,047.7

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Acquisitions (Tables)

6 Months Ended

Jun. 30, 2021

2020 Acquisitions [Member]

Summary of Aggregate Preliminary Estimates of Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the aggregate preliminary estimates of fair value of the assets acquired and liabilities assumed related to the 2020 acquisitions (in millions):

Current assets	$	33.6
Intangible assets subject to amortization:
Technology		147.9
Trademarks and trade names		1.5
Customer relationships		92.7
Other		4.9
Goodwill		189.9
Other assets		5.4
Total assets acquired		475.9
Current liabilities		4.5
Deferred income taxes		48.5
Other long-term liabilities		1.7
Total liabilities assumed		54.7
Net assets acquired	$	421.2

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Goodwill and Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Changes in Carrying Amount of Goodwill

The following table summarizes the changes in the carrying amount of goodwill by reportable segment, including the effects of changes to our reportable segments (in millions):

	Americas Orthopedics			EMEA			Asia Pacific			Americas Spine and Global Dental			Total
Balance at December 31, 2020
Goodwill	$	9,583.7		$	1,362.9		$	580.8		$	-		$	11,527.4
Accumulated impairment losses		(1,228.6	)		(1,037.0	)		-			-			(2,265.6	)
	$	8,355.1		$	325.9		$	580.8		$	-		$	9,261.8
Goodwill reportable segment change		(1,491.3	)		-			-			1,491.3			-
Accumulated impairment losses reportable segment change		1,220.9			-			-			(1,220.9	)		-
Purchase accounting adjustments		21.1			5.2			2.3			-			28.6
Other acquisitions		2.4			-			-			-			2.4
Currency translation		(29.3	)		(7.6	)		(9.0	)		0.7			(45.2	)
Balance at June 30, 2021
Goodwill	$	8,086.6		$	1,360.5		$	574.1		$	1,492.0		$	11,513.2
Accumulated impairment losses		(7.7	)		(1,037.0	)		-			(1,220.9	)		(2,265.6	)
	$	8,078.9		$	323.5		$	574.1		$	271.1		$	9,247.6

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Debt (Tables)

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Summary of Debt Instruments

Our debt consisted of the following (in millions):

	June 30,			December 31,
	2021			2020
Current portion of long-term debt
3.375% Senior Notes due 2021	$	300.0		$	300.0
3.150% Senior Notes due 2022		750.0			-
Floating Rate Notes due 2021		-			200.0
Total current portion of long-term debt	$	1,050.0		$	500.0
Long-term debt
3.150% Senior Notes due 2022	$	-		$	750.0
3.700% Senior Notes due 2023		300.0			300.0
3.550% Senior Notes due 2025		2,000.0			2,000.0
3.050% Senior Notes due 2026		600.0			600.0
3.550% Senior Notes due 2030		900.0			900.0
4.250% Senior Notes due 2035		253.4			253.4
5.750% Senior Notes due 2039		317.8			317.8
4.450% Senior Notes due 2045		395.4			395.4
1.414% Euro Notes due 2022		593.0			611.8
2.425% Euro Notes due 2026		593.0			611.8
1.164% Euro Notes due 2027		593.0			611.8
Japan Term Loan A		105.3			113.3
Japan Term Loan B		191.8			206.3
Debt discount and issuance costs		(41.7	)		(48.2	)
Adjustment related to interest rate swaps		1.5			3.1
Total long-term debt	$	6,802.5		$	7,626.5

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Accumulated Other Comprehensive Income (Tables)

6 Months Ended

Jun. 30, 2021

Equity [Abstract]

Changes in Components of Accumulated Other Comprehensive Income, Net of Tax

The following table shows the changes in the components of AOCI gains (losses), net of tax (in millions):

	Foreign			Cash			Defined
	Currency			Flow			Benefit			Total
	Translation			Hedges			Plan Items			AOCI
Balance at December 31, 2020	$	(7.2	)	$	(55.6	)	$	(235.0	)	$	(297.8	)
AOCI before reclassifications		(32.7	)		42.1			-			9.4
Reclassifications to statements of earnings		-			1.8			(0.4	)		1.4
Balance at June 30, 2021	$	(39.9	)	$	(11.7	)	$	(235.4	)	$	(287.0	)

Reclassification Adjustments from Accumulated Other Comprehensive Income

The following table shows the reclassification adjustments from AOCI (in millions):

	Amount of Gain (Loss)
	Reclassified from AOCI
	Three Months Ended						Six Months Ended
	June 30,						June 30,						Location on
Component of AOCI	2021			2020			2021			2020			Statements of Earnings
Cash flow hedges
Foreign exchange forward contracts	$	(2.6	)	$	15.1		$	(1.5	)	$	30.7		Cost of products sold
Forward starting interest rate swaps		(0.2	)		(0.1	)		(0.3	)		(0.3	)	Interest expense, net
		(2.8	)		15.0			(1.8	)		30.4		Total before tax
		(0.5	)		1.9			-			3.8		Provision (benefit) for income taxes
	$	(2.3	)	$	13.1		$	(1.8	)	$	26.6		Net of tax
Defined benefit plans
Prior service cost and unrecognized actuarial gain (loss)	$	1.8		$	(1.7	)	$	0.3		$	(3.4	)	Other income, net
		0.6			0.4			(0.1	)		(1.6	)	Provision (benefit) for income taxes
	$	1.2		$	(2.1	)	$	0.4		$	(1.8	)	Net of tax
Total reclassifications	$	(1.1	)	$	11.0		$	(1.4	)	$	24.8		Net of tax

Tax Effects on Each Component of Accumulated Other Comprehensive Income Recognized in Statements of Comprehensive Income

The following table shows the tax effects on each component of AOCI recognized in our condensed consolidated statements of comprehensive income (loss) (in millions):

	Three Months Ended June 30, 2021									Six Months Ended June 30, 2021
	Before Tax			Tax			Net of Tax			Before Tax			Tax		Net of Tax
Foreign currency cumulative translation adjustments	$	(18.2	)	$	(4.6	)	$	(13.6	)	$	(17.6	)	$	15.1	$	(32.7	)
Unrealized cash flow hedge gains		0.4			(1.8	)		2.2			47.9			5.8		42.1
Reclassification adjustments on cash flow hedges		2.8			0.5			2.3			1.8			-		1.8
Adjustments to prior service cost and unrecognized actuarial assumptions		(1.8	)		(0.6	)		(1.2	)		(0.3	)		0.1		(0.4	)
Total Other Comprehensive (Loss) Income	$	(16.8	)	$	(6.5	)	$	(10.3	)	$	31.8		$	21.0	$	10.8

	Three Months Ended June 30, 2020									Six Months Ended June 30, 2020
	Before Tax			Tax			Net of Tax			Before Tax			Tax			Net of Tax
Foreign currency cumulative translation adjustments	$	4.3		$	(18.7	)	$	23.0		$	(24.9	)	$	6.3		$	(31.2	)
Unrealized cash flow hedge (losses) gains		(27.6	)		(4.9	)		(22.7	)		38.1			6.0			32.1
Reclassification adjustments on cash flow hedges		(15.0	)		(1.9	)		(13.1	)		(30.4	)		(3.8	)		(26.6	)
Adjustments to prior service cost and unrecognized actuarial assumptions		1.7			(0.4	)		2.1			3.4			1.6			1.8
Total Other Comprehensive Loss	$	(36.6	)	$	(25.9	)	$	(10.7	)	$	(13.8	)	$	10.1		$	(23.9	)

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Fair Value Measurement of Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurement of Assets and Liabilities

The following financial assets and liabilities are recorded at fair value on a recurring basis (in millions):

	As of June 30, 2021
			Fair Value Measurements at Reporting Date Using:
Description	Recorded Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Derivatives designated as hedging, current and long-term
Foreign currency forward contracts	$	15.9	$	-	$	15.9	$	-
Cross-currency interest rate swaps		4.7		-		4.7		-
Interest rate swaps		0.8		-		0.8		-
Total Assets	$	21.4	$	-	$	21.4	$	-
Liabilities
Derivatives designated as hedging, current and long-term
Foreign currency forward contracts	$	12.1	$	-	$	12.1	$	-
Cross-currency interest rate swaps		13.4		-		13.4		-
Interest rate swaps		0.7		-		0.7		-
Contingent payments related to acquisitions		43.1		-		-		43.1
Total Liabilities	$	69.3	$	-	$	26.2	$	43.1

	As of December 31, 2020
			Fair Value Measurements at Reporting Date Using:
Description	Recorded Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Derivatives designated as hedges, current and long-term
Foreign currency forward contracts	$	0.5	$	-	$	0.5	$	-
Derivatives not designated as hedges, current and long-term
Foreign currency forward contracts		0.9		-		0.9		-
Total Assets	$	1.4	$	-	$	1.4	$	-
Liabilities
Derivatives designated as hedges, current and long-term
Foreign currency forward contracts	$	48.5	$	-	$	48.5	$	-
Cross-currency interest rate swaps		83.3		-		83.3		-
Derivatives not designated as hedges, current and long-term
Foreign currency forward contracts		3.2		-		3.2		-
Contingent payments related to acquisitions		48.2		-		-		48.2
Total Liabilities	$	183.2	$	-	$	135.0	$	48.2

Fair Value Liabilities Measured on Recurring Basis

The following table provides a reconciliation of the beginning and ending balances of items measured at fair value on a recurring basis in the tables above that used significant unobservable inputs (Level 3) (in millions):

	Level 3 - Liabilities
Contingent payments related to acquisitions
Beginning balance December 31, 2020	$	48.2
Change in estimate		2.0
Settlements		(6.8	)
Foreign currency impact		(0.3	)
Ending balance June 30, 2021	$	43.1

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Derivative Instruments and Hedging Activities (Tables)

6 Months Ended

Jun. 30, 2021

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Schedule of Amounts Recorded On Balance Sheet Related To Cumulative Basis Adjustments For Fair Value Hedges

As of June 30, 2021 and December 31, 2020, the following amounts were recorded on our condensed consolidated balance sheets related to cumulative basis adjustments for fair value hedges (in millions):

	Carrying Amount of the Hedged Liabilities				Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities
Balance Sheet Line Item	June 30, 2021		December 31, 2020		June 30, 2021		December 31, 2020
Current portion of long-term debt	$	301.4	$	303.0	$	1.4	$	3.1
Long-term debt		995.7		-		0.1		-

Gross Unrealized Losses from Derivative Instruments

Derivative instruments designated as cash flow hedges had the following effects, before taxes, on AOCI and net earnings on our condensed consolidated statements of earnings, condensed consolidated statements of comprehensive income (loss) and condensed consolidated balance sheets (in millions):

	Amount of Gain (Loss)										Amount of Gain (Loss)
	Recognized in AOCI										Reclassified from AOCI
	Three Months Ended					Six Months Ended					Three Months Ended						Six Months Ended
	June 30,					June 30,				Location on	June 30,						June 30,
Derivative Instrument	2021		2020			2021		2020		Statements of Earnings	2021			2020			2021			2020
Foreign exchange    forward contracts	$	0.4	$	(27.6	)	$	47.9	$	38.1	Cost of products sold	$	(2.6	)	$	15.1		$	(1.5	)	$	30.7
Forward starting    interest rate swaps		-		-			-		-	Interest expense, net		(0.2	)		(0.1	)		(0.3	)		(0.3	)
	$	0.4	$	(27.6	)	$	47.9	$	38.1		$	(2.8	)	$	15.0		$	(1.8	)	$	30.4

Effects of Fair Value, Cash Flow and Net Investment Hedge Accounting on Consolidated Statements of Earnings

The following table presents the effect of fair value, cash flow and net investment hedge accounting on our condensed consolidated statements of earnings (in millions):

	Location and Amount of Gain/(Loss) Recognized in Income on Fair Value, Cash Flow and Net Investment Hedging Relationships for the Period Ended:
	Three Months Ended						Three Months Ended					Six Months Ended						Six Months Ended
	June 30, 2021						June 30, 2020					June 30, 2021						June 30, 2020
	Cost of			Interest			Cost of		Interest			Cost of			Interest			Cost of		Interest
	Products			Expense,			Products		Expense,			Products			Expense,			Products		Expense,
	Sold			Net			Sold		Net			Sold			Net			Sold		Net
Total amounts of income and expense line items presented in the statements of earnings in which the effects of fair value, cash flow and net investment hedges are recorded	$	581.6		$	(54.7	)	$	424.5	$	(54.0	)	$	1,098.0		$	(107.0	)	$	911.6	$	(104.9	)
The effects of fair value, cash flow and net investment hedging:
Gain on fair value hedging                   relationships
Discontinued interest rate swaps		-			0.8			-		0.8			-			1.7			-		1.7
Gain (loss) on cash flow hedging                   relationships
Foreign exchange forward contracts		(2.6	)		-			15.1		-			(1.5	)		-			30.7		-
Forward starting interest rate swaps		-			(0.2	)		-		(0.1	)		-			(0.3	)		-		(0.3	)
Gain on net investment hedging                   relationships
Cross-currency interest rate swaps		-			10.4			-		13.4			-			23.8			-		26.8

Derivative Instruments Not Designated as Hedging Instruments

The following (losses)/gains from these derivative instruments were recognized on our condensed consolidated statements of earnings (in millions):

		Three Months Ended						Six Months Ended
	Location on	June 30,						June 30,
Derivative Instrument	Statements of Earnings	2021			2020			2021			2020
Foreign exchange forward contracts	Other expense, net	$	(1.4	)	$	(7.7	)	$	(7.7	)	$	15.4

Fair Value of Derivative Instruments on Gross Basis

The fair value of derivative instruments on a gross basis is as follows (in millions):

	As of June 30, 2021			As of December 31, 2020
	Balance			Balance
	Sheet	Fair		Sheet	Fair
	Location	Value		Location	Value
Asset Derivatives Designated as Hedges
Foreign exchange forward contracts	Other current assets	$	22.0	Other current assets	$	12.2
Cross-currency interest rate swaps	Other current assets		0.5	Other current assets		-
Foreign exchange forward contracts	Other assets		13.8	Other assets		3.7
Cross-currency interest rate swaps	Other assets		4.2	Other assets		-
Interest rate swaps	Other assets		0.8	Other assets		-
Total asset derivatives		$	41.3		$	15.9
Asset Derivatives Not Designated as Hedges
Foreign exchange forward contracts	Other current assets	$	-	Other current assets	$	1.5
Liability Derivatives Designated as Hedges
Foreign exchange forward contracts	Other current liabilities	$	23.1	Other current liabilities	$	37.4
Cross-currency interest rate swaps	Other current liabilities		8.3	Other current liabilities		55.0
Foreign exchange forward contracts	Other long-term liabilities		8.9	Other long-term liabilities		26.5
Cross-currency interest rate swaps	Other long-term liabilities		5.1	Other long-term liabilities		28.3
Interest rate swaps	Other long-term liabilities		0.7	Other long-term liabilities		-
Total liability derivatives		$	46.1		$	147.2
Liability Derivatives Not Designated as Hedges
Foreign exchange forward contracts	Other current liabilities	$	-	Other current liabilities	$	3.8

Schedule of Effects of Master Netting Agreements on Condensed Consolidated Balance Sheets

The table below presents the effects of our master netting agreements on our condensed consolidated balance sheets (in millions):

		As of June 30, 2021						As of December 31, 2020
Description	Location	Gross Amount		Offset		Net Amount in Balance Sheet		Gross Amount		Offset		Net Amount in Balance Sheet
Asset Derivatives
Cash flow hedges	Other current assets	$	22.0	$	13.6	$	8.4	$	12.2	$	11.7	$	0.5
Cash flow hedges	Other assets		13.8		6.3		7.5		3.7		3.7		-
Derivatives Not Designated as Hedges	Other current assets		-		-		-		1.5		0.6		0.9
Liability Derivatives
Cash flow hedges	Other current liabilities		23.1		13.6		9.5		37.4		11.7		25.7
Cash flow hedges	Other long-term liabilities		8.9		6.3		2.6		26.5		3.7		22.8
Derivatives Not Designated as Hedges	Other current liabilities		-		-		-		3.8		0.6		3.2

Net Investment Hedge Gains Recognized on Condensed Consolidated Statements of Comprehensive Income (Loss)

The following net investment hedge gains (losses) were recognized on our condensed consolidated statements of comprehensive income (loss) (in millions):

	Amount of Gain (Loss)
	Recognized in AOCI
	Three Months Ended						Six Months Ended
	June 30,						June 30,
Derivative Instrument	2021			2020			2021		2020
Euro Notes	$	(15.9	)	$	(39.0	)	$	56.4	$	(0.9	)
Cross-currency interest rate swaps		(28.1	)		(41.6	)		37.5		28.1
	$	(44.0	)	$	(80.6	)	$	93.9	$	27.2

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2021

Earnings Per Share [Abstract]

Reconciliation of Weighted Average Shares for Basic and Diluted Shares Computations

The following is a reconciliation of weighted average shares for the basic and diluted shares computations (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Weighted average shares outstanding for basic net earnings (loss) per share		208.6		206.8		208.3		206.6
Effect of dilutive stock options and other equity awards		2.1		-		2.1		-
Weighted average shares outstanding for diluted net earnings (loss) per share		210.7		206.8		210.4		206.6

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Summary of Net sales and Operating Profit by Segment

Net sales and operating profit by segment are as follows (in millions):

	Net Sales				Operating Profit (Loss)
	Three Months Ended				Three Months Ended
	June 30,				June 30,
	2021		2020		2021			2020
Americas Orthopedics	$	1,058.3	$	626.5	$	445.4		$	203.7
EMEA		392.9		204.1		95.2			20.1
Asia Pacific		345.7		264.5		111.4			78.4
Americas Spine and Global Dental		230.0		131.0		40.1			(3.4	)
Total	$	2,026.9	$	1,226.1
Corporate Functions						(162.0	)		(229.0	)
Inventory and manufacturing-related charges						(7.9	)		(1.4	)
Intangible asset amortization						(154.6	)		(147.7	)
Goodwill and intangible asset impairment						(16.3	)		(33.0	)
Restructuring and other cost reduction initiatives						(19.7	)		(28.0	)
Quality remediation						(11.0	)		(9.9	)
Acquisition, integration, divestiture and related						(25.4	)		(2.2	)
Litigation						(3.6	)		(1.3	)
European Union Medical Device Regulation						(10.6	)		(6.1	)
Certain R&D agreements						(65.0	)		-
Other charges						4.5			(11.9	)
Operating profit (loss)					$	220.5		$	(171.7	)

	Net Sales				Operating Profit (Loss)
	Six Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021			2020
Americas Orthopedics	$	2,004.5	$	1,569.5	$	832.5		$	607.0
EMEA		742.0		575.4		181.5			128.9
Asia Pacific		682.6		540.4		231.7			171.0
Americas Spine and Global Dental		445.2		324.6		79.1			22.5
Total	$	3,874.3	$	3,009.9
Corporate Functions						(318.4	)		(393.4	)
Inventory and manufacturing-related charges						(2.0	)		(2.0	)
Intangible asset amortization						(310.1	)		(295.3	)
Goodwill and intangible asset impairment						(16.3	)		(645.0	)
Restructuring and other cost reduction initiatives						(41.6	)		(73.0	)
Quality remediation						(21.2	)		(25.8	)
Acquisition, integration, divestiture and related						(38.8	)		(6.6	)
Litigation						(9.7	)		(81.1	)
European Union Medical Device Regulation						(17.5	)		(17.1	)
Certain R&D agreements						(65.0	)	-
Other charges						1.9			(17.8	)
Operating profit (loss)					$	486.1		$	(627.7	)

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Revenue - Schedule of Net Sales by Geography (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Sales Information [Line Items]
Net Sales	$ 2,026.9	$ 1,226.1	$ 3,874.3	$ 3,009.9
Americas [Member]
Sales Information [Line Items]
Net Sales	1,239.6	733.7	2,354.6	1,835.0
EMEA [Member]
Sales Information [Line Items]
Net Sales	429.8	218.7	814.0	616.8
Asia Pacific [Member]
Sales Information [Line Items]
Net Sales	$ 357.5	$ 273.7	$ 705.7	$ 558.1

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Revenue - Schedule of Net Sales by Product Category (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Entity Wide Information Revenue From External Customer [Line Items]
Net Sales	$ 2,026.9	$ 1,226.1	$ 3,874.3	$ 3,009.9
Knees [Member]
Entity Wide Information Revenue From External Customer [Line Items]
Net Sales	665.6	375.0	1,279.9	1,003.7
Hips [Member]
Entity Wide Information Revenue From External Customer [Line Items]
Net Sales	474.6	329.7	921.6	762.3
S.E.T [Member]
Entity Wide Information Revenue From External Customer [Line Items]
Net Sales	462.1	292.7	879.7	673.6
Dental & Spine [Member]
Entity Wide Information Revenue From External Customer [Line Items]
Net Sales	263.5	152.3	509.5	371.8
Other [Member]
Entity Wide Information Revenue From External Customer [Line Items]
Net Sales	$ 161.1	$ 76.4	$ 283.6	$ 198.5

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Restructuring - Additional Information (Detail) - 2019 Restructuring Plan [Member] - USD ($) $ in Millions	1 Months Ended
	Dec. 31, 2019	Jun. 30, 2021
Restructuring Cost And Reserve [Line Items]
Pre-tax restructuring charges		$ 375.0
Minimum [Member]
Restructuring Cost And Reserve [Line Items]
Pre-tax restructuring charges	$ 350.0
Reduction in annual pre-tax operating expenses	$ 200.0
Restructuring program benefits realized period	2023
Maximum [Member]
Restructuring Cost And Reserve [Line Items]
Pre-tax restructuring charges	$ 400.0
Reduction in annual pre-tax operating expenses	$ 300.0

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Restructuring - Summary of Liabilities Recognized Related to Restructuring Plan (Detail) - 2019 Restructuring Plan [Member] $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2021 USD ($)	Jun. 30, 2021 USD ($)
Restructuring Cost And Reserve [Line Items]
Expenses	$ 15.3	$ 34.3
Beginning Balance		64.7
Cash payments		(29.8)
Foreign currency exchange rate changes		(0.7)
Ending Balance	68.5	68.5
Expense incurred since the start of the 2019 Restructuring Plan	178.8	178.8
Expense estimated to be recognized for the 2019 Restructuring Plan	375.0	375.0
Employee Termination Benefits [Member]
Restructuring Cost And Reserve [Line Items]
Expenses	1.8	3.4
Beginning Balance		38.7
Cash payments		(8.5)
Foreign currency exchange rate changes		(0.7)
Ending Balance	32.9	32.9
Expense incurred since the start of the 2019 Restructuring Plan	81.9	81.9
Expense estimated to be recognized for the 2019 Restructuring Plan	180.0	180.0
Contract Termination [Member]
Restructuring Cost And Reserve [Line Items]
Expenses	1.5	6.8
Beginning Balance		10.9
Cash payments		(3.6)
Ending Balance	14.1	14.1
Expense incurred since the start of the 2019 Restructuring Plan	22.6	22.6
Expense estimated to be recognized for the 2019 Restructuring Plan	25.0	25.0
Other Restructuring [Member]
Restructuring Cost And Reserve [Line Items]
Expenses	12.0	24.1
Beginning Balance		15.1
Cash payments		(17.7)
Ending Balance	21.5	21.5
Expense incurred since the start of the 2019 Restructuring Plan	74.3	74.3
Expense estimated to be recognized for the 2019 Restructuring Plan	$ 170.0	$ 170.0

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Inventories - Summary of Inventories (Detail) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Inventory Disclosure [Abstract]
Finished goods	$ 2,024.0	$ 1,954.6
Work in progress	229.5	223.7
Raw materials	279.5	272.4
Inventories	$ 2,533.0	$ 2,450.7

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Property, Plant and Equipment - Summary of Property, Plant and Equipment (Detail) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	$ 6,523.1	$ 6,324.9
Accumulated depreciation	(4,517.9)	(4,277.2)
Property, plant and equipment, net	2,005.2	2,047.7
Land [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	27.5	27.7
Buildings And Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	2,266.4	2,197.8
Capitalized Software Costs [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	450.9	455.8
Instruments [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	3,668.3	3,518.3
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	$ 110.0	$ 125.3

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Property, Plant and Equipment - Additional Information (Detail) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Property Plant And Equipment [Abstract]
Property plant and equipment included in accounts payable	$ 19.5	$ 24.4

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Acquisitions - Additional Information (Details) - 2020 Acquisitions [Member] $ in Millions	6 Months Ended
	Jun. 30, 2021 USD ($)
Business Acquisition [Line Items]
Cash payments to acquire businesses	$ 244.9
Deferred business combination payments	145.0
Contingent consideration	31.3
Goodwill amount deductible for tax purpose	$ 0.0
Technology [Member]
Business Acquisition [Line Items]
Weighted average amortization period of intangible assets	13 years
Trademarks and trade names [Member]
Business Acquisition [Line Items]
Weighted average amortization period of intangible assets	12 years
Customer relationships [Member]
Business Acquisition [Line Items]
Weighted average amortization period of intangible assets	15 years
Other [Member]
Business Acquisition [Line Items]
Weighted average amortization period of intangible assets	5 years

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Acquisitions - Summary of Aggregate Preliminary Estimates of Fair Value of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Business Acquisition [Line Items]
Goodwill	$ 9,247.6	$ 9,261.8
2020 Acquisitions [Member]
Business Acquisition [Line Items]
Current assets	33.6
Goodwill	189.9
Other assets	5.4
Total assets acquired	475.9
Current liabilities	4.5
Deferred income taxes	48.5
Other long-term liabilities	1.7
Total liabilities assumed	54.7
Net assets acquired	421.2
Technology [Member] | 2020 Acquisitions [Member]
Business Acquisition [Line Items]
Intangible assets subject to amortization:	147.9
Trademarks and trade names [Member] | 2020 Acquisitions [Member]
Business Acquisition [Line Items]
Intangible assets subject to amortization:	1.5
Customer relationships [Member] | 2020 Acquisitions [Member]
Business Acquisition [Line Items]
Intangible assets subject to amortization:	92.7
Other [Member] | 2020 Acquisitions [Member]
Business Acquisition [Line Items]
Intangible assets subject to amortization:	$ 4.9

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Goodwill and Intangible Assets - Changes in Carrying Amount of Goodwill (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2021 USD ($)
Goodwill [Line Items]
Goodwill, Beginning Balance	$ 11,527.4
Accumulated impairment losses, Beginning Balance	(2,265.6)
Goodwill, net of accumulated impairment losses, Beginning Balance	9,261.8
Purchase accounting adjustments	28.6
Other acquisitions	2.4
Currency translation	(45.2)
Goodwill, Ending Balance	11,513.2
Accumulated impairment losses, Ending Balance	(2,265.6)
Goodwill, net of accumulated impairment losses, Ending Balance	9,247.6
Americas Orthopedics [Member]
Goodwill [Line Items]
Goodwill, Beginning Balance	9,583.7
Accumulated impairment losses, Beginning Balance	(1,228.6)
Goodwill, net of accumulated impairment losses, Beginning Balance	8,355.1
Goodwill reportable segment change	(1,491.3)
Accumulated impairment losses reportable segment change	1,220.9
Purchase accounting adjustments	21.1
Other acquisitions	2.4
Currency translation	(29.3)
Goodwill, Ending Balance	8,086.6
Accumulated impairment losses, Ending Balance	(7.7)
Goodwill, net of accumulated impairment losses, Ending Balance	8,078.9
EMEA [Member]
Goodwill [Line Items]
Goodwill, Beginning Balance	1,362.9
Accumulated impairment losses, Beginning Balance	(1,037.0)
Goodwill, net of accumulated impairment losses, Beginning Balance	325.9
Purchase accounting adjustments	5.2
Currency translation	(7.6)
Goodwill, Ending Balance	1,360.5
Accumulated impairment losses, Ending Balance	(1,037.0)
Goodwill, net of accumulated impairment losses, Ending Balance	323.5
Asia Pacific [Member]
Goodwill [Line Items]
Goodwill, Beginning Balance	580.8
Goodwill, net of accumulated impairment losses, Beginning Balance	580.8
Purchase accounting adjustments	2.3
Currency translation	(9.0)
Goodwill, Ending Balance	574.1
Goodwill, net of accumulated impairment losses, Ending Balance	574.1
Americas Spine and Global Dental [Member]
Goodwill [Line Items]
Goodwill reportable segment change	1,491.3
Accumulated impairment losses reportable segment change	(1,220.9)
Currency translation	0.7
Goodwill, Ending Balance	1,492.0
Accumulated impairment losses, Ending Balance	(1,220.9)
Goodwill, net of accumulated impairment losses, Ending Balance	$ 271.1

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Goodwill and Intangible Assets - Additional Information (Detail) $ in Millions	3 Months Ended			6 Months Ended
	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Mar. 31, 2020 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)
Indefinite Lived Intangible Assets By Major Class [Line Items]
Reporting units with goodwill assigned to them			3
Goodwill impairment					$ 612.0
Goodwill	$ 9,247.6			$ 9,247.6		$ 9,261.8
In Process Research and Development [Member]
Indefinite Lived Intangible Assets By Major Class [Line Items]
Impairment of Intangible Assets, Finite-lived	16.3	$ 33.0		16.3	33.0
Decrease In Estimated Fair Value of In Process Research and Development [Member]
Indefinite Lived Intangible Assets By Major Class [Line Items]
Impairment of Intangible Assets, Finite-lived		19.0			19.0
Terminated In Process Research and Development [Member]
Indefinite Lived Intangible Assets By Major Class [Line Items]
Impairment of Intangible Assets, Finite-lived	16.3	$ 14.0		16.3	14.0
Dental [Member]
Indefinite Lived Intangible Assets By Major Class [Line Items]
Goodwill impairment			$ 142.0		142.0
Goodwill	271.1			271.1
EMEA [Member]
Indefinite Lived Intangible Assets By Major Class [Line Items]
Goodwill impairment			470.0		470.0
Goodwill	$ 323.5			$ 323.5		$ 325.9
EMEA [Member] | Reportable Segment Change [Member]
Indefinite Lived Intangible Assets By Major Class [Line Items]
Goodwill impairment			$ 470.0		$ 470.0
America CMFT [Member]
Indefinite Lived Intangible Assets By Major Class [Line Items]
Reporting units with goodwill assigned to them			2
Percentage of fair value in excess of carrying amount		5.00%			5.00%

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Transfers of Financial Assets - Additional Information (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2021	Dec. 31, 2020
Transfers And Servicing [Abstract]
Aggregate face value of receivables sold	$ 980.9	$ 70.2
Cash proceeds from receivables	979.9	69.7
Proceeds from customers	885.8
Repurchase of accounts receivables sold	$ 84.1
Proceeds from other current liabilities		$ 0.0	$ 0.0

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Debt - Summary of Debt Instruments (Detail) $ in Millions, € in Billions, ¥ in Billions	Jun. 30, 2021 USD ($)	Jun. 30, 2021 EUR (€)	Jun. 30, 2021 JPY (¥)	Dec. 31, 2020 USD ($)	Mar. 20, 2020 USD ($)
Current portion of long-term debt
Current portion of long-term debt	$ 1,050.0			$ 500.0
Long-term debt
Senior Notes due	7,600.0
Debt discount and issuance costs	(41.7)			(48.2)
Adjustment related to interest rate swaps	1.5			3.1
Total long-term debt	6,802.5			7,626.5
Senior Notes [Member] | 3.375% [Member] | Due in 2021 [Member]
Current portion of long-term debt
Current portion of long-term debt	300.0			300.0
Senior Notes [Member] | Three Point One Five Zero Percentage | Two Thousand Twenty Two
Current portion of long-term debt
Current portion of long-term debt	750.0
Long-term debt
Senior Notes due				750.0
Senior Notes [Member] | 3.700% [Member] | Due in 2023 [Member]
Long-term debt
Senior Notes due	300.0			300.0
Senior Notes [Member] | 3.550% [Member] | Due in 2025 [Member]
Long-term debt
Senior Notes due	2,000.0			2,000.0
Senior Notes [Member] | 3.550% [Member] | Due in 2030 [Member]
Long-term debt
Senior Notes due	900.0			900.0	$ 900.0
Senior Notes [Member] | 3.050% [Member] | Due in 2026 [Member]
Long-term debt
Senior Notes due	600.0			600.0	$ 600.0
Senior Notes [Member] | 4.250% [Member] | Due in 2035 [Member]
Long-term debt
Senior Notes due	253.4			253.4
Senior Notes [Member] | 5.750% [Member] | Due in 2039 [Member]
Long-term debt
Senior Notes due	317.8			317.8
Senior Notes [Member] | 4.450% [Member] | Due in 2045 [Member]
Long-term debt
Senior Notes due	395.4			395.4
Floating Rate Notes [Member] | Due in 2021 [Member]
Current portion of long-term debt
Current portion of long-term debt				200.0
Euro Notes [Member]
Long-term debt
Term loan | €		€ 1.8
Euro Notes [Member] | 1.414% [Member] | Two Thousand Twenty Two
Long-term debt
Term loan	593.0			611.8
Euro Notes [Member] | 1.164% [Member] | Due in 2027 [Member]
Long-term debt
Term loan	593.0			611.8
Euro Notes [Member] | 2.425% [Member] | Due in 2026 [Member]
Long-term debt
Term loan	593.0			611.8
Japan Term Loan A [Member]
Long-term debt
Term loan	105.3		¥ 11.7	113.3
Japan Term Loan B [Member]
Long-term debt
Term loan	$ 191.8		¥ 21.3	$ 206.3

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Debt - Summary of Debt Instruments (Parenthetical) (Detail)	Jun. 30, 2021	Dec. 31, 2020	Mar. 20, 2020
Three Point One Five Zero Percentage | Two Thousand Twenty Two | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	3.15%	3.15%
3.375% [Member] | Due in 2021 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	3.375%	3.375%
3.700% [Member] | Due in 2023 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	3.70%	3.70%
3.050% [Member] | Due in 2026 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	3.05%	3.05%	3.05%
3.550% [Member] | Due in 2025 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	3.55%	3.55%
3.550% [Member] | Due in 2030 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	3.55%	3.55%	3.55%
4.250% [Member] | Due in 2035 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	4.25%	4.25%
5.750% [Member] | Due in 2039 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	5.75%	5.75%
4.450% [Member] | Due in 2045 [Member] | Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate	4.45%	4.45%
1.414% [Member] | Two Thousand Twenty Two | Euro Notes [Member]
Debt Instrument [Line Items]
Interest rate	1.414%	1.414%
2.425% [Member] | Due in 2026 [Member] | Euro Notes [Member]
Debt Instrument [Line Items]
Interest rate	2.425%	2.425%
1.164% [Member] | Due in 2027 [Member] | Euro Notes [Member]
Debt Instrument [Line Items]
Interest rate	1.164%	1.164%

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Debt - Additional Information (Detail) € in Billions, ¥ in Billions					6 Months Ended
	Sep. 18, 2020 USD ($)	Apr. 01, 2020 USD ($)	Mar. 20, 2020 USD ($)	Nov. 01, 2019 USD ($)	Jun. 30, 2021 USD ($)	Sep. 30, 2021	Jun. 30, 2021 EUR (€)	Jun. 30, 2021 JPY (¥)	Mar. 31, 2021	Dec. 31, 2020 USD ($)	Apr. 23, 2020 USD ($)	Mar. 31, 2020
Debt Instrument [Line Items]
Debt, long-term and short-term, combined amount					$ 7,900,000,000
Aggregate principal amount of Senior Notes					7,600,000,000
Debt discount and issuance costs					41,700,000					$ 48,200,000
Estimated fair value					$ 8,238,200,000
2019 Credit Agreement [Member] | Maximum [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio									5.00%	5.75%		5.75%
Consolidated leverage ratio thereafter					4.50%		4.50%	4.50%
2019 Credit Agreement [Member] | Maximum [Member] | Scenario Forecast [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio thereafter						5.00%
2019 Credit Agreement [Member] | Minimum [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio									1.00%	1.00%		1.00%
Consolidated leverage ratio thereafter					1.00%		1.00%	1.00%
2019 Credit Agreement [Member] | Minimum [Member] | Scenario Forecast [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio thereafter						1.00%
September 2020 Credit Agreement [Member]
Debt Instrument [Line Items]
Maturity date of debt instrument	Sep. 17, 2021
Principal amount, unsecured credit facility	$ 1,000,000,000.0										$ 1,000,000,000.0
Outstanding borrowings					$ 0
September 2020 Credit Agreement [Member] | Maximum [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio	5.75%								5.00%	5.75%
Consolidated leverage ratio thereafter					4.50%		4.50%	4.50%
September 2020 Credit Agreement [Member] | Maximum [Member] | Scenario Forecast [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio thereafter						5.00%
September 2020 Credit Agreement [Member] | Minimum [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio	1.00%								1.00%	1.00%
Consolidated leverage ratio thereafter					1.00%		1.00%	1.00%
September 2020 Credit Agreement [Member] | Minimum [Member] | Scenario Forecast [Member]
Debt Instrument [Line Items]
Consolidated leverage ratio thereafter						1.00%
Euro Notes [Member]
Debt Instrument [Line Items]
Term loan | €							€ 1.8
Japan Term Loan A [Member]
Debt Instrument [Line Items]
Term loan					$ 105,300,000			¥ 11.7		$ 113,300,000
Maturity date of debt instrument					Sep. 27, 2022
Japan Term Loan B [Member]
Debt Instrument [Line Items]
Term loan					$ 191,800,000			¥ 21.3		206,300,000
Maturity date of debt instrument					Sep. 27, 2022
Other Debt and Fair Value Adjustments [Member]
Debt Instrument [Line Items]
Other long-term debt					$ 1,500,000
Floating Rate Notes [Member]
Debt Instrument [Line Items]
Repayments of term loan					200,000,000.0
Senior Notes [Member] | 3.050% [Member] | Due in 2026 [Member]
Debt Instrument [Line Items]
Aggregate principal amount of Senior Notes			$ 600,000,000.0		$ 600,000,000.0					$ 600,000,000.0
Maturity date of debt instrument			Jan. 15, 2026
Interest rate			3.05%		3.05%		3.05%	3.05%		3.05%
Senior Notes [Member] | 3.550% [Member] | Due in 2030 [Member]
Debt Instrument [Line Items]
Aggregate principal amount of Senior Notes			$ 900,000,000.0		$ 900,000,000.0					$ 900,000,000.0
Maturity date of debt instrument			Mar. 20, 2030
Interest rate			3.55%		3.55%		3.55%	3.55%		3.55%
Senior Notes [Member] | 2.700% [Member] | Due in 2020 [Member]
Debt Instrument [Line Items]
Maturity date of debt instrument		Apr. 01, 2020
Repayments of term loan		$ 1,500,000,000
Interest rate		2.70%
Multicurrency Revolving Facility [Member] | 2019 Credit Agreement [Member]
Debt Instrument [Line Items]
Maturity date of debt instrument				Nov. 01, 2024
Principal amount, unsecured credit facility				$ 1,500,000,000
Debt instrument term				5 years
Outstanding borrowings					$ 0
Uncommitted incremental feature				$ 500,000,000.0
Japan Term Loan A and Japan Term Loan B [Member]
Debt Instrument [Line Items]
Estimated fair value					$ 296,500,000

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Accumulated Other Comprehensive Income - Changes in Components of Accumulated Other Comprehensive Income, Net of Tax (Detail) $ in Millions	6 Months Ended
	Jun. 30, 2021 USD ($)
Other Comprehensive Income Loss [Line Items]
Stockholders equity, beginning balance	$ 12,194.2
AOCI before reclassifications	9.4
Reclassifications to statements of earnings	1.4
Stockholders equity, ending balance	12,577.9
Cash Flow Hedges [Member]
Other Comprehensive Income Loss [Line Items]
Stockholders equity, beginning balance	(55.6)
AOCI before reclassifications	42.1
Reclassifications to statements of earnings	1.8
Stockholders equity, ending balance	(11.7)
Foreign Currency Translation [Member]
Other Comprehensive Income Loss [Line Items]
Stockholders equity, beginning balance	(7.2)
AOCI before reclassifications	(32.7)
Stockholders equity, ending balance	(39.9)
Defined Benefit Plan Items [Member]
Other Comprehensive Income Loss [Line Items]
Stockholders equity, beginning balance	(235.0)
Reclassifications to statements of earnings	(0.4)
Stockholders equity, ending balance	(235.4)
Total AOCI [Member]
Other Comprehensive Income Loss [Line Items]
Stockholders equity, beginning balance	(297.8)
Stockholders equity, ending balance	$ (287.0)

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Accumulated Other Comprehensive Income - Reclassification Adjustments from Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Other Comprehensive Income Loss [Line Items]
Cost of products sold	$ 581.6	$ 424.5	$ 1,098.0	$ 911.6
Type of Cost, Good or Service [Extensible List]	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember
Interest expense, net	$ (54.7)	$ (54.0)	$ (107.0)	$ (104.9)
Other income, net	8.1	3.8	15.4	6.8
Earnings (loss) before income taxes	173.9	(221.9)	394.5	(725.8)
Provision (benefit) for income taxes	31.4	(13.7)	54.3	(8.5)
Reclassification out of Accumulated Other Comprehensive Income [Member]
Other Comprehensive Income Loss [Line Items]
Net of tax	(1.1)	11.0	(1.4)	24.8
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedges [Member]
Other Comprehensive Income Loss [Line Items]
Earnings (loss) before income taxes	(2.8)	15.0	(1.8)	30.4
Provision (benefit) for income taxes	(0.5)	1.9		3.8
Net of tax	(2.3)	13.1	(1.8)	26.6
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedges [Member] | Foreign Exchange Forward Contracts [Member]
Other Comprehensive Income Loss [Line Items]
Cost of products sold	$ (2.6)	$ 15.1	$ (1.5)	$ 30.7
Type of Cost, Good or Service [Extensible List]	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember	us-gaap:ProductMember
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedges [Member] | Forward Starting Interest Rate Swaps [Member]
Other Comprehensive Income Loss [Line Items]
Interest expense, net	$ (0.2)	$ (0.1)	$ (0.3)	$ (0.3)
Reclassification out of Accumulated Other Comprehensive Income [Member] | Defined Benefit Plan Items [Member]
Other Comprehensive Income Loss [Line Items]
Provision (benefit) for income taxes	0.6	0.4	(0.1)	(1.6)
Net of tax	1.2	(2.1)	0.4	(1.8)
Reclassification out of Accumulated Other Comprehensive Income [Member] | Defined Benefit Plan Items [Member] | Prior Service Cost and Unrecognized Actuarial Gain Loss [Member]
Other Comprehensive Income Loss [Line Items]
Other income, net	$ 1.8	$ (1.7)	$ 0.3	$ (3.4)

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Accumulated Other Comprehensive Income - Tax Effects on Each Component of Accumulated Other Comprehensive Income Recognized in Statements of Comprehensive Income (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Statement Of Income And Comprehensive Income [Abstract]
Foreign currency cumulative translation adjustments, before tax	$ (18.2)	$ 4.3	$ (17.6)	$ (24.9)
Unrealized cash flow hedge gains (losses), before tax	0.4	(27.6)	47.9	38.1
Reclassification adjustments on cash flow hedges, before tax	2.8	(15.0)	1.8	(30.4)
Adjustments to prior service cost and unrecognized actuarial assumptions, before tax	(1.8)	1.7	(0.3)	3.4
Total Other Comprehensive Income (Loss), before tax	(16.8)	(36.6)	31.8	(13.8)
Foreign currency cumulative translation adjustments, tax	(4.6)	(18.7)	15.1	6.3
Unrealized cash flow hedge gains (losses), before tax	(1.8)	(4.9)	5.8	6.0
Reclassification adjustments on cash flow hedges, tax	0.5	(1.9)		(3.8)
Adjustments to prior service cost and unrecognized actuarial assumptions, tax	(0.6)	(0.4)	0.1	1.6
Total Other Comprehensive Income (Loss), before tax	(6.5)	(25.9)	21.0	10.1
Foreign currency cumulative translation adjustments, net of tax	(13.6)	23.0	(32.7)	(31.2)
Unrealized cash flow hedge gains (losses), net of tax	2.2	(22.7)	42.1	32.1
Reclassification adjustments on hedges, net of tax	2.3	(13.1)	1.8	(26.6)
Adjustments to prior service cost and unrecognized actuarial assumptions, net of tax	(1.2)	2.1	(0.4)	1.8
Total Other Comprehensive Income (Loss)	$ (10.3)	$ (10.7)	$ 10.8	$ (23.9)

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Fair Value Measurement of Assets and Liabilities - Fair Value Measurements of Assets and Liabilities (Detail) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total Assets	$ 21.4	$ 1.4
Contingent payments related to acquisitions	43.1	48.2
Total Liabilities	69.3	183.2
Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total Assets	21.4	1.4
Total Liabilities	26.2	135.0
Fair Value Measurements at Reporting Date Using: Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent payments related to acquisitions	43.1	48.2
Total Liabilities	43.1	48.2
Foreign Exchange Forward Contracts [Member] | Derivatives Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term	15.9	0.5
Derivatives, current and long-term	12.1	48.5
Foreign Exchange Forward Contracts [Member] | Derivatives Not Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term		0.9
Derivatives, current and long-term		3.2
Foreign Exchange Forward Contracts [Member] | Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member] | Derivatives Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term	15.9	0.5
Derivatives, current and long-term	12.1	48.5
Foreign Exchange Forward Contracts [Member] | Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member] | Derivatives Not Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term		0.9
Derivatives, current and long-term		3.2
Cross-currency Interest Rate Swaps [Member] | Derivatives Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term	4.7
Derivatives, current and long-term	13.4	83.3
Cross-currency Interest Rate Swaps [Member] | Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member] | Derivatives Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term	4.7
Derivatives, current and long-term	13.4	$ 83.3
Interest Rate Swaps [Member] | Derivatives Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term	0.8
Derivatives, current and long-term	0.7
Interest Rate Swaps [Member] | Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member] | Derivatives Designated as Hedges [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives, current and long-term	0.8
Derivatives, current and long-term	$ 0.7

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Fair Value Measurements - Fair Value Liabilities Measured on Recurring Basis (Detail) - Fair Value Measurements at Reporting Date Using: Significant Unobservable Inputs (Level 3) [Member] - Fair Value, Measurements, Recurring [Member] $ in Millions	6 Months Ended
	Jun. 30, 2021 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Beginning balance December 31, 2020	$ 48.2
Change in estimate	2.0
Settlements	(6.8)
Foreign currency impact	(0.3)
Ending balance June 30, 2021	$ 43.1

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Derivative Instruments and Hedging Activities - Additional Information (Detail) € in Millions, SFr in Millions, ¥ in Billions	3 Months Ended		6 Months Ended
	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2021 EUR (€)	Jun. 30, 2021 JPY (¥)	Jun. 30, 2021 CHF (SFr)
Derivative Instruments Gain Loss [Line Items]
Fair value hedges of fixed rate obligations	$ 1,000,000,000		$ 1,000,000,000
Unamortized balance related to discontinued hedges instruments which will be recognized under effective interest rate method	1,400,000		1,400,000
Forward starting interest rate swap cash flow hedge to be amortized	25,600,000		$ 25,600,000
Percentage of debt designated as net investment hedges			100.00%
Expected months of hedging of inter company sales of inventory to minimize the effects of foreign exchange rate movements			30 months
Fair value of outstanding derivative instruments, net unrealized loss deferred in accumulated other comprehensive income	(20,400,000)		$ (20,400,000)
Gains (losses) on derivatives	900,000	$ 1,600,000	4,300,000	$ (21,900,000)
Cost of Products Sold [Member]
Derivative Instruments Gain Loss [Line Items]
Fair value of outstanding derivative instruments, gain (loss), expected to be reclassified to earnings	(4,400,000)		(4,400,000)
Fair value of outstanding derivative instruments, gain (loss), net of taxes expected to be reclassified to earnings	(4,000,000.0)		(4,000,000.0)
Interest Expense [Member]
Derivative Instruments Gain Loss [Line Items]
Fair value of outstanding derivative instruments, gain (loss), expected to be reclassified to earnings	(600,000)		(600,000)
Fair value of outstanding derivative instruments, gain (loss), net of taxes expected to be reclassified to earnings	(500,000)		(500,000)
Cash Flow Hedges [Member]
Derivative Instruments Gain Loss [Line Items]
Fair value of outstanding derivative instruments, unrealized loss net of taxes deferred in accumulated other comprehensive income	(11,700,000)		(11,700,000)
Cross-currency Interest Rate Swaps [Member]
Derivative Instruments Gain Loss [Line Items]
Derivative notional amount, Total					€ 775	¥ 7	SFr 50
Cross-Currency Interest Rate Swaps Matured [Member]
Derivative Instruments Gain Loss [Line Items]
Derivative notional amount, Total | €					€ 675
Net investment hedge gain/loss at maturity			37,100,000
Foreign Exchange Contract [Member] | U.S. Dollars [Member]
Derivative Instruments Gain Loss [Line Items]
Derivative notional amount, Total	1,459,100,000		1,459,100,000
Foreign Exchange Contract [Member] | Swiss Francs [Member]
Derivative Instruments Gain Loss [Line Items]
Derivative notional amount, Total	324,000,000.0		$ 324,000,000.0
4.450% [Member] | Senior Notes [Member] | Due in 2045 [Member]
Derivative Instruments Gain Loss [Line Items]
Hedged senior notes maturity period			30 years
Derivatives Designated as Hedges [Member]
Derivative Instruments Gain Loss [Line Items]
Derivative notional amount, Total	1,000,000,000		$ 1,000,000,000
Derivatives Not Designated as Hedges [Member] | Foreign Exchange Contract [Member] | Minimum [Member]
Derivative Instruments Gain Loss [Line Items]
Derivative notional amount, Total	1,500,000,000		1,500,000,000
Derivatives Not Designated as Hedges [Member] | Foreign Exchange Contract [Member] | Maximum [Member]
Derivative Instruments Gain Loss [Line Items]
Derivative notional amount, Total	$ 2,000,000,000.0		$ 2,000,000,000.0

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Derivative Instruments and Hedging Activities - Schedule of Amounts Recorded On Balance Sheet Related To Cumulative Basis Adjustments For Fair Value Hedges (Detail) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Derivative Instruments Gain Loss [Line Items]
Current portion of long-term debt	$ 1,050.0	$ 500.0
Fair value hedges of fixed rate obligations	1,000.0
Carrying Amount of Hedged Liabilities [Member]
Derivative Instruments Gain Loss [Line Items]
Current portion of long-term debt	301.4	303.0
Fair value hedges of fixed rate obligations	995.7
Cumulative Amount of Fair Value Hedging Adjustment Included in Carrying Amount of Hedged Liabilities [Member] | Long Term Debt Current [Member]
Derivative Instruments Gain Loss [Line Items]
Long-term debt	1.4	$ 3.1
Cumulative Amount of Fair Value Hedging Adjustment Included in Carrying Amount of Hedged Liabilities [Member] | Long Term Debt Noncurrent [Member]
Derivative Instruments Gain Loss [Line Items]
Long-term debt	$ 0.1

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Derivative Instruments and Hedging Activities - Gross Unrealized Losses from Derivative Instruments (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Recognized in AOCI	$ 0.4	$ (27.6)	$ 47.9	$ 38.1
Cash Flow Hedges [Member]
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Recognized in AOCI	0.4	(27.6)	47.9	38.1
Amount of Gain / (Loss) Reclassified from AOCI	(2.8)	15.0	(1.8)	30.4
Cash Flow Hedges [Member] | Foreign Exchange Forward Contracts [Member]
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Recognized in AOCI	0.4	(27.6)	47.9	38.1
Cash Flow Hedges [Member] | Foreign Exchange Forward Contracts [Member] | Cost of Products Sold [Member]
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Reclassified from AOCI	(2.6)	15.1	(1.5)	30.7
Cash Flow Hedges [Member] | Forward Starting Interest Rate Swaps [Member] | Interest Expense [Member]
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Reclassified from AOCI	$ (0.2)	$ (0.1)	$ (0.3)	$ (0.3)

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Derivative Instruments and Hedging Activities - Effects of Fair Value, Cash Flow and Net Investment Hedge Accounting on Condensed Consolidated Statements of Earnings (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Derivative Instruments Gain Loss [Line Items]
Gain on net investment hedging relationships	$ (44.0)	$ (80.6)	$ 93.9	$ 27.2
Cash Flow Hedges [Member]
Derivative Instruments Gain Loss [Line Items]
Gain (loss) on cash flow hedging relationships	(2.8)	15.0	(1.8)	30.4
Cost of Products Sold [Member]
Derivative Instruments Gain Loss [Line Items]
Total amounts of income and expense line items presented in the statements of earnings in which the effects of fair value, cash flow and net investment hedges are recorded	581.6	424.5	1,098.0	911.6
Interest Expense [Member]
Derivative Instruments Gain Loss [Line Items]
Total amounts of income and expense line items presented in the statements of earnings in which the effects of fair value, cash flow and net investment hedges are recorded	(54.7)	(54.0)	(107.0)	(104.9)
Interest Expense [Member] | Discontinued Interest Rate Swaps [Member]
Derivative Instruments Gain Loss [Line Items]
Gain on fair value hedging relationships	0.8	0.8	1.7	1.7
Foreign Exchange Forward Contracts [Member] | Cost of Products Sold [Member] | Cash Flow Hedges [Member]
Derivative Instruments Gain Loss [Line Items]
Gain (loss) on cash flow hedging relationships	(2.6)	15.1	(1.5)	30.7
Forward Starting Interest Rate Swaps [Member] | Interest Expense [Member] | Cash Flow Hedges [Member]
Derivative Instruments Gain Loss [Line Items]
Gain (loss) on cash flow hedging relationships	(0.2)	(0.1)	(0.3)	(0.3)
Cross-currency Interest Rate Swaps [Member]
Derivative Instruments Gain Loss [Line Items]
Gain on net investment hedging relationships	(28.1)	(41.6)	37.5	28.1
Cross-currency Interest Rate Swaps [Member] | Interest Expense [Member] | Net Investment Hedging [Member]
Derivative Instruments Gain Loss [Line Items]
Gain on net investment hedging relationships	$ 10.4	$ 13.4	$ 23.8	$ 26.8

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Derivative Instruments and Hedging Activities - Derivative Instruments Not Designated as Hedging Instruments (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Derivatives Not Designated as Hedges [Member] | Foreign Exchange Forward Contracts [Member] | Other Expense, Net [Member]
Derivative Instruments Gain Loss [Line Items]
Gains/(losses) from derivative instruments not designated as hedging instruments	$ (1.4)	$ (7.7)	$ (7.7)	$ 15.4

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Derivative Instruments and Hedging Activities - Fair Value of Derivative Instruments on Gross Basis (Detail) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets	$ 41.3	$ 15.9
Derivative Liabilities	46.1	147.2
Other Current Assets [Member] | Derivatives Not Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets		1.5
Other Current Liabilities [Member] | Derivatives Not Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities		3.8
Foreign Exchange Forward Contracts [Member] | Other Current Assets [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets	22.0	12.2
Foreign Exchange Forward Contracts [Member] | Other Current Assets [Member] | Derivatives Not Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets		1.5
Foreign Exchange Forward Contracts [Member] | Other Assets [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets	13.8	3.7
Foreign Exchange Forward Contracts [Member] | Other Current Liabilities [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities	23.1	37.4
Foreign Exchange Forward Contracts [Member] | Other Current Liabilities [Member] | Derivatives Not Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities		3.8
Foreign Exchange Forward Contracts [Member] | Other Long-term Liabilities [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities	8.9	26.5
Cross-currency Interest Rate Swaps [Member] | Other Current Assets [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets	0.5
Cross-currency Interest Rate Swaps [Member] | Other Assets [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets	4.2
Cross-currency Interest Rate Swaps [Member] | Other Current Liabilities [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities	8.3	55.0
Cross-currency Interest Rate Swaps [Member] | Other Long-term Liabilities [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities	5.1	$ 28.3
Interest Rate Swap [Member] | Other Assets [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Assets	0.8
Interest Rate Swap [Member] | Other Long-term Liabilities [Member] | Derivatives Designated as Hedges [Member]
Derivatives, Fair Value [Line Items]
Derivative Liabilities	$ 0.7

XML

Derivative Instruments and Hedging Activities - Schedule of Effects of Master Netting Agreements on Condensed Consolidated Balance Sheets (Detail) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Other Current Assets [Member] | Derivatives Not Designated as Hedges [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gross Amount		$ 1.5
Offset		0.6
Net Amount in Balance Sheet		0.9
Other Current Assets [Member] | Cash Flow Hedges [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gross Amount	$ 22.0	12.2
Offset	13.6	11.7
Net Amount in Balance Sheet	8.4	0.5
Other Assets [Member] | Cash Flow Hedges [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gross Amount	13.8	3.7
Offset	6.3	3.7
Net Amount in Balance Sheet	7.5
Other Current Liabilities [Member] | Derivatives Not Designated as Hedges [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gross Amount		3.8
Offset		0.6
Net Amount in Balance Sheet		3.2
Other Current Liabilities [Member] | Cash Flow Hedges [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gross Amount	23.1	37.4
Offset	13.6	11.7
Net Amount in Balance Sheet	9.5	25.7
Other Long-term Liabilities [Member] | Cash Flow Hedges [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gross Amount	8.9	26.5
Offset	6.3	3.7
Net Amount in Balance Sheet	$ 2.6	$ 22.8

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Derivative Instruments and Hedging Activities - Net Investment Hedge Gains (Losses) Recognized on Condensed Consolidated Statements of Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Recognized in AOCI	$ (44.0)	$ (80.6)	$ 93.9	$ 27.2
Euro Notes [Member]
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Recognized in AOCI	(15.9)	(39.0)	56.4	(0.9)
Cross-currency Interest Rate Swaps [Member]
Derivative Instruments Gain Loss [Line Items]
Amount of Gain / (Loss) Recognized in AOCI	$ (28.1)	$ (41.6)	$ 37.5	$ 28.1

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Income Taxes - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Income Taxes Disclosure [Line Items]
Decrease in unrecognized tax benefits within the next twelve months	$ 250.0		$ 250.0
Increase in unrecognized tax benefits within the next twelve months	20.0		20.0
Amount of potential additional income tax expense related to an IRS revenue agents report subject to interest and penalties	370.0		370.0
Provision (benefit) for income taxes	$ 31.4	$ (13.7)	$ 54.3	$ (8.5)
Effective tax rate	18.00%	6.20%	13.80%	1.20%
Goodwill impairment				$ 612.0
U.S. corporate income tax rate			21.00%
Tax Reform and AHV Financing [Member]
Income Taxes Disclosure [Line Items]
Provision (benefit) for income taxes			$ (10.0)

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Earnings Per Share - Reconciliation of Weighted Average Shares for Basic and Diluted Shares Computations (Detail) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Earnings Per Share [Abstract]
Weighted average shares outstanding for basic net earnings (loss) per share	208.6	206.8	208.3	206.6
Effect of dilutive stock options and other equity awards	2.1		2.1
Weighted average shares outstanding for diluted net earnings (loss) per share	210.7	206.8	210.4	206.6

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Earnings Per Share - Additional Information (Detail) - shares shares in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2021
Earnings Per Share [Abstract]
Options to purchase shares of common stock not included in the computation of diluted earnings per share	0.4	0.4

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Segment Information - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2021 Segment
Segment Reporting [Abstract]
Number of operating segments	4

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Segment Information - Summary of Net Sales and Operating Profit by Segment (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Net Sales And Operating Profit Information [Line Items]
Net Sales	$ 2,026.9	$ 1,226.1	$ 3,874.3	$ 3,009.9
Operating Profit (Loss)	220.5	(171.7)	486.1	(627.7)
Intangible asset amortization	(154.6)	(147.7)	(310.1)	(295.3)
Goodwill and intangible asset impairment	(16.3)	(33.0)	(16.3)	(645.0)
Restructuring and other cost reduction initiatives	(19.6)	(28.0)	(41.4)	(73.0)
Quality remediation	(11.0)	(9.7)	(21.2)	(26.1)
Acquisition, integration, divestiture and related	(25.4)	(2.2)	(38.8)	(6.6)
EMEA [Member]
Net Sales And Operating Profit Information [Line Items]
Net Sales	429.8	218.7	814.0	616.8
Asia Pacific [Member]
Net Sales And Operating Profit Information [Line Items]
Net Sales	357.5	273.7	705.7	558.1
Corporate Functions [Member]
Net Sales And Operating Profit Information [Line Items]
Operating Profit (Loss)	(162.0)	(229.0)	(318.4)	(393.4)
Operating Segments [Member] | Americas Orthopedics [Member]
Net Sales And Operating Profit Information [Line Items]
Net Sales	1,058.3	626.5	2,004.5	1,569.5
Operating Profit (Loss)	445.4	203.7	832.5	607.0
Operating Segments [Member] | EMEA [Member]
Net Sales And Operating Profit Information [Line Items]
Net Sales	392.9	204.1	742.0	575.4
Operating Profit (Loss)	95.2	20.1	181.5	128.9
Operating Segments [Member] | Asia Pacific [Member]
Net Sales And Operating Profit Information [Line Items]
Net Sales	345.7	264.5	682.6	540.4
Operating Profit (Loss)	111.4	78.4	231.7	171.0
Operating Segments [Member] | Americas Spine and Global Dental [Member]
Net Sales And Operating Profit Information [Line Items]
Net Sales	230.0	131.0	445.2	324.6
Operating Profit (Loss)	40.1	(3.4)	79.1	22.5
Segment Reconciling Items [Member]
Net Sales And Operating Profit Information [Line Items]
Inventory and manufacturing-related charges	(7.9)	(1.4)	(2.0)	(2.0)
Intangible asset amortization	(154.6)	(147.7)	(310.1)	(295.3)
Goodwill and intangible asset impairment	(16.3)	(33.0)	(16.3)	(645.0)
Restructuring and other cost reduction initiatives	(19.7)	(28.0)	(41.6)	(73.0)
Quality remediation	(11.0)	(9.9)	(21.2)	(25.8)
Acquisition, integration, divestiture and related	(25.4)	(2.2)	(38.8)	(6.6)
Litigation	(3.6)	(1.3)	(9.7)	(81.1)
European Union Medical Device Regulation	(10.6)	(6.1)	(17.5)	(17.1)
Certain R&D agreements	(65.0)		(65.0)
Other charges	$ 4.5	$ (11.9)	$ 1.9	$ (17.8)

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Commitments and Contingencies - Additional Information (Detail) € in Thousands, $ in Millions			1 Months Ended				6 Months Ended
	Feb. 13, 2019 USD ($)	Feb. 13, 2019 NOK (kr)	Mar. 31, 2021 USD ($)	Mar. 31, 2021 EUR (€)	Jan. 31, 2017 EUR (€)	Dec. 31, 2016 EUR (€)	Jun. 30, 2019 EUR (€)	Jun. 30, 2021 USD ($)
Loss Contingencies [Line Items]
Loss contingency, damages awarded, value	$ 2.3	kr 19,500,000
Durom Cup Related Claims [Member]
Loss Contingencies [Line Items]
Estimated liability outstanding								$ 47.9
Metal Reaction Related Claims [Member]
Loss Contingencies [Line Items]
Estimated liability outstanding								49.2
Biomet Metal On Metal Hip Implant Claims [Member]
Loss Contingencies [Line Items]
Estimated liability classified as short-term								69.5
Heraeus Trade Secret Misappropriation Lawsuits [Member]
Loss Contingencies [Line Items]
Loss Contingency, Damages incurred			$ 16.6	€ 13,840
Heraeus Trade Secret Misappropriation Lawsuits [Member] | Germany [Member]
Loss Contingencies [Line Items]
Loss Contingency, Damages incurred | €					€ 125,900	€ 121,900	€ 146,700
Other Contingencies [Member]
Loss Contingencies [Line Items]
Estimated liability outstanding								0.0
Other contingencies estimated payments range								$ 380.0