PENSION AND POSTRETIREMENT BENEFIT PLANS

9 Months Ended

Sep. 30, 2019

Retirement Benefits [Abstract]

Pension and Other Postretirement Benefits [Text Block]

RETIREMENT BENEFITS

BMS sponsors defined benefit pension plans, defined contribution plans and termination indemnity plans for regular full-time employees. The principal defined benefit pension plan was the Bristol-Myers Squibb Retirement Income Plan (the “Plan”), which covered most U.S. employees. Future benefits related to service for this plan were eliminated in 2009. The Company contributed at least the minimum amount required by the ERISA. Plan benefits were based primarily on the participant’s years of credited service and final average compensation. As of September 30, 2019, remaining Plan assets consist primarily of fixed-income securities.

The net periodic benefit cost of defined benefit pension plans includes:

	Three Months Ended September 30,						Nine Months Ended September 30,
Dollars in Millions	2019			2018			2019			2018
Service cost – benefits earned during the year	$	6		$	6		$	18		$	20
Interest cost on projected benefit obligation	20			50			101			146
Expected return on plan assets	(39		)	(97		)	(173		)	(315		)
Amortization of prior service credits	(1		)	(1		)	(3		)	(3		)
Amortization of net actuarial loss	14			17			49			57
Curtailments and settlements	1,550			26			1,643			95
Net periodic pension benefit cost	$	1,550		$	1		$	1,635		$	—

In December 2018, BMS announced plans to fully terminate the Plan. Pension obligations related to the Plan were to be distributed through a combination of lump sum payments to eligible Plan participants who elected such payments and through the purchase of group annuity contracts from wholly owned insurance subsidiaries of Athene Holding Ltd. (“Athene”). In the third quarter of 2019, $1.3 billion was distributed to participants who elected lump sum payments during the election window and a group annuity contract was purchased from Athene, which irrevocably assumed the obligation, for $2.4 billion for most of the remaining plan participants. These transactions resulted in a $1.5 billion non-cash pre-tax pension settlement charge in the third quarter of 2019. The remaining plan obligation of approximately $200 million is expected to be settled through the purchase of an additional group annuity contract from Athene in the fourth quarter of 2019.

Pension settlement charges were also recognized after determining that the annual lump sum payments will likely exceed the annual interest and service costs for the primary and certain other U.S. and international pension plans. The charges included the acceleration of a portion of unrecognized actuarial losses. Non-current pension liabilities were $426 million at September 30, 2019 and $427 million at December 31, 2018. Defined contribution plan expense in the U.S. was approximately $50 million and $140 million for the three and nine months ended September 30, 2019 and approximately $50 million and $130 million for the three and nine months ended September 30, 2018, respectively. Comprehensive medical and group life benefits are provided for substantially all U.S. retirees electing to participate in comprehensive medical and group life plans and to a lesser extent certain benefits for non-U.S. employees. The net periodic benefit credits were not material in both periods.