
	September 30, 2022						December 31, 2021
Dollars in Millions	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Cash and cash equivalents - money market and other securities	$	—	$	4,667	$	—	$	—	$	12,225	$	—
Marketable debt securities:
Certificates of deposit	—		1,080		—		—		2,264		—
Commercial paper	—		168		—		—		320		—
Corporate debt securities	—		45		—		—		403		—
Derivative assets	—		1,058		8		—		206		12
Equity investments	426		493		—		1,910		109		—
Derivative liabilities	—		81		—		—		25		—
Contingent consideration liability:
Contingent value rights	6		—		—		8		—		—
Other acquisition related contingent consideration	—		—		32		—		—		35

As further described in “Item 8. Financial Statements and Supplementary Data—Note 9. Financial Instruments and Fair Value Measurements” in the Company’s 2021 Form 10-K, the Company’s fair value estimates use inputs that are either (1) quoted prices for identical assets or liabilities in active markets (Level 1 inputs); (2) observable prices for similar assets or liabilities in active markets or for identical or similar assets or liabilities in markets that are not active (Level 2 inputs); or (3) unobservable inputs (Level 3 inputs). The fair value of equity investments is adjusted for characteristics specific to the security and is not adjusted for contractual sale restrictions. Equity investments subject to contractual sale restrictions were not material as of September 30, 2022 and December 31, 2021. The restrictions will expire by April 2023.

Contingent consideration obligations are recorded at their estimated fair values and these obligations are revalued each reporting period until the related contingencies are resolved. The contingent value rights are adjusted to fair value using the traded price of the securities at the end of each reporting period. The fair value measurements for other contingent consideration liabilities are estimated using probability-weighted discounted cash flow approaches that are based on significant unobservable inputs related to product candidates acquired in business combinations and are reviewed quarterly. These inputs include, as applicable, estimated probabilities and timing of achieving specified development and regulatory milestones and the discount rate used to calculate the present value of estimated future payments. Significant changes which increase or decrease the probabilities of achieving the related development and regulatory events or shorten or lengthen the time required to achieve such events would result in corresponding increases or decreases in the fair values of these obligations.


	September 30, 2022								December 31, 2021
Dollars in Millions	Amortized Cost		Gross Unrealized						Amortized Cost		Gross Unrealized
			Gains		Losses		Fair Value				Gains		Losses		Fair Value
Certificates of deposit	$	1,080	$	—	$	—	$	1,080	$	2,264	$	—	$	—	$	2,264
Commercial paper	168		—		—		168		320		—		—		320
Corporate debt securities	45		—		—		45		401		2		—		403
Total marketable debt securities(a)	$	1,293	$	—	$	—	$	1,293	$	2,985	$	2	$	—	$	2,987


Dollars in Millions	September 30, 2022		December 31, 2021
Equity investments with readily determinable fair values	$	919	$	2,019
Equity investments without readily determinable fair values	505		283
Limited partnerships and other equity method investments	535		666
Total equity investments	$	1,959	$	2,968


	Three Months Ended September 30,				Nine Months Ended September 30,
Dollars in Millions	2022		2021		2022		2021
Equity investments with readily determined fair values(a)
Net loss/(gain) recognized	$	75	$	22	$	927	$	(93)
Net (gain)/loss recognized on investments sold	(1)		3		(17)		5
Net unrealized loss/(gain) recognized on investments still held	76		19		944		(98)

Equity investments without readily determinable fair values
Upward adjustments	(64)		(447)		(70)		(908)
Impairments and downward adjustments	—		—		2		1
Cumulative upward adjustments					(173)
Cumulative impairments and downward adjustments					52

Equity in net loss/(income) of affiliates	3		(40)		107		(214)

Cash Flow Hedges — Foreign currency forward contracts are used to hedge certain forecasted intercompany inventory purchases and sales transactions and certain foreign currency transactions. The fair value for contracts designated as cash flow hedges is temporarily reported in Accumulated other comprehensive loss and included in earnings when the hedged item affects earnings. The net gain or loss on foreign currency forward contracts is expected to be reclassified to net earnings (primarily included in Cost of products sold) within the next 24 months. The notional amount of outstanding foreign currency forward contracts was primarily attributed to the euro of $5.1 billion and Japanese yen of $1.4 billion as of September 30, 2022.

During the three months ended September 30, 2022, BMS entered into cross-currency interest rate swap contracts to hedge exposure to foreign currency exchange rate risk associated with its long-term debt denominated in euros. These contracts convert interest payments and principal repayment of the long-term debt to U.S. dollars from euros and are designated as cash flow hedges. The unrealized gains and losses on these contracts are reported in Accumulated other comprehensive loss and reclassified to Other (income)/expense, net, in the same periods during which the hedged debt affects earnings. The notional amount of cross-currency interest rate swap contracts was €575 million ($584 million) as of September 30, 2022.

Cash flow hedge accounting is discontinued when the forecasted transaction is no longer probable of occurring within 60 days after the originally forecasted date or when the hedge is no longer effective. Assessments to determine whether derivatives designated as qualifying hedges are highly effective in offsetting changes in the cash flows of hedged items are performed at inception and on a quarterly basis. The earnings impact related to discontinued cash flow hedges and hedge ineffectiveness was not material during all periods presented. Foreign currency forward contracts not designated as hedging instruments are used to offset exposures in certain foreign currency denominated assets, liabilities and earnings. Changes in the fair value of these derivatives are recognized in earnings as they occur.

Net Investment Hedges — Non-U.S. dollar borrowings of €375 million ($368 million) as of September 30, 2022, are designated as net investment hedges to hedge euro currency exposures of the net investment in certain foreign affiliates and are recognized in long-term debt. The effective portion of foreign exchange gain on the remeasurement of euro debt was included in the foreign currency translation component of Accumulated other comprehensive loss with the related offset in long-term debt.

Cross-currency interest rate swap contracts of $1.4 billion as of September 30, 2022, are designated to hedge certain currency exposures of BMS’s net investment in its foreign subsidiaries. Contract fair value changes are recorded in the foreign currency translation component of Accumulated other comprehensive loss with a related offset in Other current and Other non-current assets or Other current and Other non-current liabilities. The notional amount of outstanding cross-currency interest rate swaps was primarily attributed to the Japanese yen of $686 million and euro of $584 million as of September 30, 2022.

Fair Value Hedges — Fixed to floating interest rate swap contracts are designated as fair value hedges and used as an interest rate risk management strategy to create an appropriate balance of fixed and floating rate debt. The contracts and underlying debt for the hedged benchmark risk are recorded at fair value. The effective interest rate for the contracts is one-month LIBOR (3.14% as of September 30, 2022) plus an interest rate spread of 4.6%. Gains or losses resulting from changes in fair value of the underlying debt attributable to the hedged benchmark interest rate risk are recorded in interest expense with an associated offset to the carrying value of debt. Since the specific terms and notional amount of the swap are intended to align with the debt being hedged, all changes in fair value of the swap are recorded in interest expense with an associated offset to the derivative asset or liability on the consolidated balance sheet. As a result, there was no net impact in earnings. If the underlying swap is terminated prior to maturity, then the fair value adjustment to the underlying debt is amortized as a reduction to interest expense over the remaining term of the debt.


	September 30, 2022								December 31, 2021
	Asset(a)				Liability(b)				Asset(a)				Liability(b)
Dollars in Millions	Notional		Fair Value		Notional		Fair Value		Notional		Fair Value		Notional		Fair Value
Derivatives designated as hedging instruments:
Interest rate swap contracts	$	—	$	—	$	255	$	(19)	$	255	$	10	$	—	$	—
Cross-currency interest rate swap contracts	1,411		136		584		(43)		600		26		—		—
Foreign currency forward contracts	7,978		882		145		(8)		3,587		161		1,814		(20)

Derivatives not designated as hedging instruments:
Foreign currency forward contracts	1,628		40		561		(11)		883		9		568		(5)

Other	—		8		—		—		—		12		—		—


	Three Months Ended September 30, 2022				Nine Months Ended September 30, 2022
Dollars in Millions	Cost of products sold		Other (income)/expense, net		Cost of products sold		Other (income)/expense, net
Interest rate swap contracts	$	—	$	(5)	$	—	$	(23)

Cross-currency interest rate swap contracts	—		13		—		5
Foreign currency forward contracts	(195)		(61)		(408)		(136)


	Three Months Ended September 30, 2021				Nine Months Ended September 30, 2021
Dollars in Millions	Cost of products sold		Other (income)/expense, net		Cost of products sold		Other (income)/expense, net
Interest rate swap contracts	$	—	$	(7)	$	—	$	(22)
Cross-currency interest rate swap contracts	—		(2)		—		(8)
Foreign currency forward contracts	19		2		145		(14)


	Three Months Ended September 30,				Nine Months Ended September 30,
Dollars in Millions	2022		2021		2022		2021
Derivatives qualifying as cash flow hedges
Foreign currency forward contracts gain/(loss):
Recognized in Other Comprehensive Income(a)	$	548	$	93	$	1,149	$	314
Reclassified to Cost of products sold	(195)		37		(408)		126
Cross-currency interest rate swap contracts gain/(loss):
Recognized in Other Comprehensive Income	(43)		—		(43)		—
Reclassified to Other (income)/expense, net	20		—		20		—
Forward starting interest rate swap contract loss:
Reclassified to Other (income)/expense, net	—		—		(3)		—

Derivatives qualifying as net investment hedges
Cross-currency interest rate swap contracts gain:
Recognized in Other Comprehensive Income	71		—		135		26

Non-derivatives qualifying as net investment hedges
Non-U.S. dollar borrowings gain:
Recognized in Other Comprehensive Income	40		20		123		45


Dollars in Millions	September 30, 2022		December 31, 2021
Principal Value	$	38,137	$	43,095

Adjustments to Principal Value:
Fair value of interest rate swap contracts	(19)		10
Unamortized basis adjustment from swap terminations	101		119
Unamortized bond discounts and issuance costs	(290)		(263)
Unamortized purchase price adjustments of Celgene debt	940		1,408
Total	$	38,869	$	44,369

Current portion of long-term debt	$	1,903	$	4,764
Long-term debt	36,966		39,605
Total	$	38,869	$	44,369

The fair value of long-term debt was $34.3 billion as of September 30, 2022 and $49.1 billion at December 31, 2021 valued using Level 2 inputs, which are based upon the quoted market prices for the same or similar debt instruments. The fair value of short-term borrowings approximates the carrying value due to the short maturities of the debt instruments.

During the nine months ended September 30 2022, BMS purchased an aggregate principal amount of $6.0 billion of certain of its debt securities for $6.6 billion of cash in tender offers and “make whole” redemptions. In connection with these transactions, a $266 million net loss on debt redemption was recognized based on the carrying value of the debt and included in Other (income)/expense, net.

During the nine months ended September 30, 2022, $4.75 billion of debt matured and was repaid including $1.5 billion 2.600% Notes, $500 million Floating Rate Notes, $750 million 2.000% Notes, $1.0 billion 3.250% Notes and $1.0 billion 3.550% Notes.

During the nine months ended September 30, 2021, BMS purchased an aggregate principal amount of $3.5 billion of certain of its debt securities for approximately $4.0 billion of cash in a series of tender offers and “make whole” redemptions. In connection with these transactions, a $281 million loss on debt redemption was recognized based on the carrying value of the debt and included in Other (income)/expense, net.

As of December 31, 2021, BMS had four separate revolving credit facilities totaling $6.0 billion, which consisted of a 364-day $2.0 billion facility which expired in January 2022, a three-year $1.0 billion facility which expired in January 2022 and two five-year $1.5 billion facilities that were extended to September 2025 and July 2026, respectively.