Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

(in millions)	Total		Level 1		Level 2		Level 3
At December 31, 2015
Financial assets:
Marketable equity securities	$	17.2	$	17.2	$	—	$	—
Contingent consideration receivable	13.8		—		—		13.8
Derivative contracts	1.9		—		1.9		—
Total assets	32.9		17.2		1.9		13.8
Financial liabilities:
Derivative contracts	11.5		—		11.5		—
Contingent consideration payable	475.9		—		—		475.9
Total liabilities	$	487.4	$	—	$	11.5	$	475.9

As of September 30, 2016 and December 31, 2015, the following financial assets and liabilities are measured at fair value on a recurring basis using quoted prices in active markets for identical assets (Level 1); significant other observable inputs (Level 2); and significant unobservable inputs (Level 3).

	Fair value
(in millions)	Total		Level 1		Level 2		Level 3
At September 30, 2016
Financial assets:
Marketable equity securities	$	69.7	$	69.7	$	—	$	—
Marketable debt securities	16.5		3.7		12.8		—
Contingent consideration receivable	15.7		—		—		15.7
Derivative instruments	50.6		—		50.6		—
Total assets	152.5		73.4		63.4		15.7
Financial liabilities:
Derivative instruments	13.3		—		13.3		—
Contingent consideration payable	996.7		—		—		996.7
Total liabilities	$	1,010.0	$	—	$	13.3	$	996.7

Assets Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)

The following table provides a roll forward of the fair values of our contingent consideration receivable and payables which include Level 3 measurements:

Contingent consideration receivable
(in millions)	2016			2015
Balance at January 1,	$	13.8		$	15.9
Change in fair value included in earnings	3.6			9.8
Other	(1.7		)	(10.8		)
Balance at September 30,	$	15.7		$	14.9

Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)

Contingent consideration payable
(in millions)	2016			2015
Balance at January 1,	$	475.9		$	629.9
Additions	557.0			92.8
Change in fair value included in earnings	(34.8		)	(196.5		)
Other	(1.4		)	(5.6		)
Balance at September 30,	$	996.7		$	520.6

Fair Value Inputs, Assets Quantitative Information Table

Quantitative information about the Company’s recurring Level 3 fair value measurements is as follows:

Financial assets:	Fair Value at the Measurement Date
At September 30, 2016
(in millions, except percentages)	Fair value		Valuation technique	Significant unobservable inputs	Range
Contingent consideration receivable	$	15.7	Income approach (probability weighted discounted cash flow)	• Probability weightings applied to different sales scenarios	• 10 to 90%
				• Future forecast consideration receivable based on contractual terms with purchaser	• $0 to $23 million
				• Assumed market participant discount rate	• 8.4%

Fair Value Inputs, Liabilities Quantitative Information Table

Financial liabilities:	Fair Value at the Measurement Date
At September 30, 2016
(in millions, except percentages)	Fair value		Valuation technique	Significant unobservable inputs	Range
Contingent consideration payable	$	996.7	Income approach (probability weighted discounted cash flow)	• Cumulative probability of milestones being achieved	• 4 to 90%
				• Assumed market participant discount rate	• 1.2 to 10.5%
				• Periods in which milestones are expected to be achieved	• 2016 to 2030
				• Forecast quarterly royalties payable on net sales of relevant products	• $3.5 to $7.1 million

Schedule of Fair Value, Assets and Liabilities Not Measured at Fair Value on Recurring Basis

The carrying amounts and estimated fair values as of September 30, 2016 and December 31, 2015 of the Company’s financial assets and liabilities that are not measured at fair value on a recurring basis are as follows: 

	September 30, 2016				December 31, 2015
(in millions)	Carrying amount		Fair value		Carrying amount		Fair value
Financial liabilities:
Senior notes	$	12,037.0	$	12,080.9	$	—	$	—
Baxalta notes	5,104.4		5,467.7		—		—
Capital lease obligation	348.6		348.6		13.4		13.4