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Debt, Credit Facilities and Commitments and Contingencies
 12 Months Ended
Dec. 31, 2021
Debt, Credit Facilities and Commitments and Contingencies  
Debt, Credit Facilities and Commitments and Contingencies Debt, Credit Facilities and Commitments and Contingencies The following table summarizes long-term debt:
as of December 31 (dollars in millions)
Effective
interest rate
in 2021(a)
2021
Effective
interest rate
in 2020(a)
2020
Senior notes issued in 2012
2.90% notes due 2022
2.97 %$3,100 2.97 %$3,100 
4.40% notes due 2042
4.46 %2,600 4.46 %2,600 
Senior notes issued in 2015
3.20% notes due 2022
3.28 %1,000 3.28 %1,000 
3.60% notes due 2025
3.66 %3,750 3.66 %3,750 
4.50% notes due 2035
4.58 %2,500 4.58 %2,500 
4.70% notes due 2045
4.73 %2,700 4.73 %2,700 
Senior notes issued in 2016
2.30% notes due 2021
2.40 %— 2.40 %1,800 
2.85% notes due 2023
2.91 %1,000 2.91 %1,000 
3.20% notes due 2026
3.28 %2,000 3.28 %2,000 
4.30% notes due 2036
4.37 %1,000 4.37 %1,000 
4.45% notes due 2046
4.50 %2,000 4.50 %2,000 
Senior Euro notes issued in 2016
1.375% notes due 2024 (€1,450 principal)
1.46 %1,643 1.46 %1,783 
2.125% notes due 2028 (€750 principal)
2.18 %850 2.18 %922 
Senior notes issued in 2018
3.375% notes due 2021
3.51 %— 3.51 %1,250 
3.75% notes due 2023
3.84 %1,250 3.84 %1,250 
4.25% notes due 2028
4.38 %1,750 4.38 %1,750 
4.875% notes due 2048
4.94 %1,750 4.94 %1,750 
Senior Euro notes issued in 2019
0.75% notes due 2027 (€750 principal)
0.86 %850 0.86 %922 
1.25% notes due 2031 (€650 principal)
1.30 %737 1.30 %799 
Senior notes issued in 2019
Floating rate notes due May 20210.74 %— 1.33 %750 
Floating rate notes due November 20210.78 %— 1.42 %750 
Floating rate notes due 20220.99 %750 1.62 %750 
2.15% notes due 2021
2.23 %— 2.23 %1,750 
2.30% notes due 2022
2.42 %3,000 2.42 %3,000 
2.60% notes due 2024
2.69 %3,750 2.69 %3,750 
2.95% notes due 2026
3.02 %4,000 3.02 %4,000 
3.20% notes due 2029
3.25 %5,500 3.25 %5,500 
4.05% notes due 2039
4.11 %4,000 4.11 %4,000 
4.25% notes due 2049
4.29 %5,750 4.29 %5,750 
Term loan facilities
Floating rate notes due 20231.23 %— 1.29 %1,000 
Floating rate notes due 20230.81 %1,000 — %— 
Floating rate notes due 20251.36 %2,000 1.42 %2,000 
as of December 31 (dollars in millions)
Effective
interest rate
in 2021(a)
2021
Effective
interest rate
in 2020(a)
2020
Senior notes acquired in 2020
5.000% notes due 2021
1.53 %— 1.53 %1,200 
3.450% notes due 2022
1.97 %2,878 1.97 %2,878 
3.250% notes due 2022
1.92 %1,700 1.92 %1,700 
2.800% notes due 2023
2.13 %350 2.13 %350 
3.850% notes due 2024
2.07 %1,032 2.07 %1,032 
3.800% notes due 2025
2.09 %3,021 2.09 %3,021 
4.550% notes due 2035
3.52 %1,789 3.52 %1,789 
4.625% notes due 2042
4.00 %457 4.00 %457 
4.850% notes due 2044
4.11 %1,074 4.11 %1,074 
4.750% notes due 2045
4.20 %881 4.20 %881 
Senior Euro notes acquired in 2020
0.500% notes due 2021 (€750 principal)
0.72 %— 0.72 %922 
1.500% notes due 2023 (€500 principal)
0.49 %567 0.49 %615 
1.250% notes due 2024 (€700 principal)
0.65 %793 0.65 %861 
2.625% notes due 2028 (€500 principal)
1.20 %567 1.20 %615 
2.125% notes due 2029 (€550 principal)
1.19 %623 1.19 %677 
Other33 29 
Fair value hedges102 278 
Unamortized bond discounts(130)(146)
Unamortized deferred financing costs(251)(287)
Unamortized bond premiums (b)
954 1,200 
Total long-term debt and finance lease obligations76,670 86,022 
Current portion12,481 8,468 
Noncurrent portion$64,189 $77,554 
(a)Excludes the effect of any related interest rate swaps.
(b)Represents unamortized purchase price adjustments of Allergan debt.
In April 2021, the company repaid $1.8 billion aggregate principal amount of 2.3% senior notes that were scheduled to mature in May 2021. In May 2021, the company repaid €750 million aggregate principal amount of 0.5% senior Euro notes that were scheduled to mature in June 2021. These repayments were made by exercising, under the terms of the notes, 30-day early redemptions at 100% of the principal amounts. The company also repaid $750 million aggregate principal amount of floating rate senior notes at maturity in May 2021.
In September 2021, the company refinanced its $1.0 billion floating rate three-year term loan. As part of the refinancing, the company repaid the existing $1.0 billion term loan due May 2023 and borrowed $1.0 billion under a new term loan at a lower floating rate. All other significant terms of the loan, including the maturity date, remained unchanged after the refinancing.
In September 2021, the company repaid $1.2 billion aggregate principal amount of 5.0% senior notes that were scheduled to mature in December 2021. This repayment was made by exercising, under the terms of the notes, 90-day early redemption at 100% of the principal amount.
In November 2021, the company repaid $1.3 billion aggregate principal amount of 3.375% senior notes and $1.8 billion aggregate principal amount of 2.15% senior notes at maturity. The company also repaid $750 million aggregate principal amount of floating rate senior notes at maturity in November 2021.
In January 2022, the company repaid $2.9 billion aggregate principal amount of 3.450% senior notes that were scheduled to mature in March 2022. This repayment was made by exercising, under the terms of the notes, 60-day early redemption at 100% of the principal amount.
In connection with the acquisition of Allergan, in May 2020, the company borrowed $3.0 billion under a $6.0 billion term loan credit agreement, of which $1.0 billion was outstanding under a floating rate three-year term loan tranche and $2.0 billion outstanding under a floating rate five-year term loan tranche as of December 31, 2021. Subsequent to these borrowings, AbbVie terminated the unused commitments of the lenders under the term loan.
In May 2020, AbbVie completed its previously announced offers to exchange any and all outstanding notes of certain series issued by Allergan for new notes to be issued by AbbVie and cash. Following the settlement of the exchange offers, AbbVie issued $14.0 billion and €3.1 billion of new notes in exchange for the Allergan notes tendered in the exchange offers. The aggregate principal amount of Allergan notes that remained outstanding following the settlement of the exchange offers was approximately $1.5 billion and €635 million. The exchange transaction was accounted for as a modification of the assumed debt instruments.
In May 2020, the company repaid $3.8 billion aggregate principal amount of 2.5% senior notes at maturity.
In September 2020, the company repaid $650 million aggregate principal amount of 3.375% senior notes at maturity.
In November 2020, the company repaid €700 million aggregate principal amount of floating rate senior Euro notes at maturity and $450 million aggregate principal amount of 4.875% senior notes due February 2021 three months prior to maturity.
In September 2019, the company issued €1.4 billion aggregate principal amount of unsecured senior Euro notes. These senior notes rank equally with all other unsecured and unsubordinated indebtedness of the company. AbbVie may redeem the senior notes prior to maturity at a redemption price equal to the principal amount of the senior notes redeemed plus a make-whole premium and may redeem the senior notes at par between one and three months prior to maturity. In connection with the offering, debt issuance costs incurred totaled $9 million and debt discounts totaled $5 million and are being amortized over the respective terms of the notes to interest expense, net in the consolidated statements of earnings. In October 2019, the company used the proceeds to redeem €1.4 billion aggregate principal amount of 0.375% senior Euro notes that were due to mature in November 2019.
In November 2019, the company issued $30.0 billion aggregate principal amount of unsecured senior notes. These senior notes rank equally with all other unsecured and unsubordinated indebtedness of the company. AbbVie may redeem the fixed-rate senior notes prior to maturity at a redemption price equal to the greater of the principal amount or the sum of present values of the remaining scheduled payments of principal and interest on the fixed-rate senior notes to be redeemed plus a make-whole premium. With exception of the fixed-rate notes due 2021 and 2022, AbbVie may also redeem the fixed-rate senior notes at par between one and six months prior to maturity. In connection with the offering, debt issuance costs incurred totaled $173 million and debt discounts totaled $52 million, which are being amortized over the respective terms of the notes to interest expense, net in the consolidated statements of earnings. AbbVie used the net proceeds to fund a portion of the aggregate cash consideration due to Allergan shareholders in connection with the acquisition described in Note 5 and to pay related fees and expenses.
AbbVie has outstanding $4.8 billion aggregate principal amount of unsecured senior notes which were issued in 2018. AbbVie may redeem the senior notes prior to maturity at a redemption price equal to the principal amount of the senior notes redeemed plus a make-whole premium and AbbVie may redeem the senior notes at par between one month and six months prior to maturity.
AbbVie has outstanding €2.2 billion aggregate principal amount of unsecured senior Euro notes which were issued in 2016. AbbVie may redeem the senior notes prior to maturity at a redemption price equal to the principal amount of the senior notes redeemed plus a make-whole premium and AbbVie may redeem the senior notes at par between one and three months prior to maturity.
AbbVie has outstanding $6.0 billion aggregate principal amount of unsecured senior notes which were issued in 2016 and $10.0 billion aggregate principal amount of unsecured senior notes which were issued in 2015. AbbVie may redeem the senior notes, at any time, prior to maturity at a redemption price equal to the principal amount of the senior notes redeemed plus a make-whole premium and AbbVie may redeem the senior notes at par between one and six months prior to maturity.
AbbVie has outstanding $5.7 billion aggregate principal amount of unsecured senior notes which were issued in 2012. AbbVie may redeem all of the senior notes of each series, at any time, or some of the senior notes of each series, from time to time, at a redemption price equal to the principal amount of the senior notes redeemed plus a make-whole premium.
At December 31, 2021, the company was in compliance with its senior note covenants and term loan covenants.
Short-Term Borrowings
There were no commercial paper borrowings outstanding as of December 31, 2021 and December 31, 2020. No commercial paper borrowings were issued during 2021. The weighted-average interest rate on commercial paper borrowings was 1.8% in 2020 and 2.5% in 2019.
In August 2019, AbbVie entered into an amended and restated $4.0 billion five-year revolving credit facility that matures in August 2024. This amended facility enables the company to borrow funds on an unsecured basis at variable interest rates and contains various covenants, all of which the company was in compliance with as of December 31, 2021. Commitment fees under AbbVie's revolving credit facilities were insignificant in 2021, 2020 and 2019. No amounts were outstanding under the company's credit facilities as of December 31, 2021 and December 31, 2020.
In March 2019, AbbVie repaid a $3.0 billion 364-day term loan credit agreement that was drawn on in June 2018 and was scheduled to mature in June 2019.
Maturities of Long-Term Debt
The following table summarizes AbbVie's debt maturities as of December 31, 2021:
as of and for the years ending December 31 (in millions)
2022$12,428 
20234,167 
20247,219 
20258,771 
20266,000 
Thereafter37,377 
Total obligations and commitments75,962 
Fair value hedges, unamortized bond premiums and discounts, deferred financing costs and finance lease obligations708 
Total long-term debt and finance lease obligations$76,670 
Contingencies and Guarantees
In connection with the separation, AbbVie has indemnified Abbott for all liabilities resulting from the operation of AbbVie's business other than income tax liabilities with respect to periods prior to the distribution date and other liabilities as agreed to by AbbVie and Abbott. AbbVie has no material exposures to off-balance sheet arrangements and no special-purpose entities. In the ordinary course of business, AbbVie has periodically entered into third-party agreements, such as the assignment of product rights, which have resulted in AbbVie becoming secondarily liable for obligations for which AbbVie had previously been primarily liable. Based upon past experience, the likelihood of payments under these agreements is remote.