Other Income, Net (Tables)

3 Months Ended

Mar. 31, 2014

Other Income and Expenses [Abstract]

Schedule of Other Income

	Three Months Ended
	March 31,
	2014			2013
Royalty income	$	38		$	37
Interest income	28			27
Equity in earnings (losses) of affiliates, excluding exchange gains/losses1	13			(7		)
Net gain on sales of other assets	7			5
Net exchange (losses) gains1	(96		)	11
Cozaar®/Hyzaar® income	1			2
Miscellaneous income and expenses, net 2	26			17
Other income, net	$	17		$	92

¹ The company routinely uses foreign currency exchange contracts to offset its net exposures, by currency, related to the foreign currency-denominated monetary assets and liabilities. The objective of this program is to maintain an approximately balanced position in foreign currencies in order to minimize, on an after-tax basis, the effects of exchange rate changes on net monetary asset positions. The net pre-tax exchange gains (losses) are recorded in Other income, net and the related tax impact is recorded in Provision for income taxes on continuing operations on the interim Consolidated Income Statements. Exchange gains (losses) related to earnings of affiliates was $(2) and $5 for the three months ended March 31, 2014 and 2013, respectively. The $(96) net exchange loss for the three months ended March 31, 2014, includes $(39) and $(14) exchange losses, associated with the devaluation of the Ukrainian hryvnia and Argentinian peso, respectively. The $11 net exchange gain for the three months ended March 31, 2013, includes a $(36) exchange loss, associated with the devaluation of the Venezuelan bolivar.

²   Miscellaneous income and expenses, net, generally includes interest items, certain insurance recoveries and litigation settlements, and other items.