10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2017

Commission File Number 1-6926

C. R. BARD, INC.

(Exact name of registrant as specified in its charter)

New Jersey	730 Central Avenue Murray Hill, New Jersey 07974	22-1454160
(State of incorporation)	(Address of principal executive offices)	(I.R.S. Employer Identification No.)

Registrant’s telephone number, including area code: (908) 277-8000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
		Smaller reporting company	☐
Non-accelerated filer	☐  (Do not check if smaller reporting company)	Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at March 31, 2017
Common Stock - $0.25 par value	72,417,180

C. R. BARD, INC. AND SUBSIDIARIES

INDEX

		Page
PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2017 and 2016		3
	Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2017 and 2016		4
	Condensed Consolidated Balance Sheets – March  31, 2017 and December 31, 2016		5
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2017 and 2016		6
	Notes to Condensed Consolidated Financial Statements		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		29
Item 4.	Controls and Procedures		29
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings		30
Item 1A.	Risk Factors		33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		34
Item 5.	Other Information		35
Item 6.	Exhibits		35
Signatures			36

2

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

C. R. BARD, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands except per share amounts, unaudited)

	Three Months Ended March 31,
	2017		2016
Net sales	$	938,800	$	873,500
Costs and expenses:
Cost of goods sold		354,200		320,400
Marketing, selling and administrative expense		285,400		270,600
Research and development expense		70,000		68,300
Interest expense		15,100		11,300
Other (income) expense, net		12,600		60,000
Total costs and expenses		737,300		730,600
Income from operations before income taxes		201,500		142,900
Income tax provision		23,400		26,700
Net income	$	178,100	$	116,200
Basic earnings per share available to common shareholders	$	2.42	$	1.56
Diluted earnings per share available to common shareholders	$	2.37	$	1.54

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

C. R. BARD, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(dollars in thousands, unaudited)

	Three Months Ended March 31,
	2017		2016
Net income	$	178,100	$	116,200
Other comprehensive income (loss):
Change in derivative instruments designated as cash flow hedges, net of tax		6,600		(9,200	)
Foreign currency translation adjustments		4,600		1,600
Benefit plan adjustments, net of tax		2,200		1,700
Other comprehensive income (loss)		13,400		(5,900	)
Comprehensive income	$	191,500	$	110,300

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

C. R. BARD, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands except share and per share amounts, unaudited)

	March 31, 2017			December 31, 2016
ASSETS
Current assets
Cash and cash equivalents	$	890,700		$	905,000
Restricted cash		179,100			201,500
Accounts receivable, less allowances of $4,400 and $7,200, respectively		450,000			477,300
Inventories		497,200			483,000
Other current assets		283,800			249,600
Total current assets		2,300,800			2,316,400
Property, plant and equipment, at cost		865,000			847,100
Less accumulated depreciation and amortization		370,600			357,600
Net property, plant and equipment		494,400			489,500
Goodwill		1,261,000			1,260,500
Core and developed technologies, net		662,600			686,400
Other intangible assets, net		321,500			323,600
Deferred income taxes		38,700			64,400
Other assets		165,600			165,300
Total assets	$	5,244,600		$	5,306,100
LIABILITIES AND SHAREHOLDERS’ INVESTMENT
Current liabilities
Short-term borrowings and current maturities of long-term debt	$	609,300		$	—
Accounts payable		102,000			96,000
Accrued expenses		715,000			809,500
Accrued compensation and benefits		118,100			186,100
Income taxes payable		15,300			17,300
Total current liabilities		1,559,700			1,108,900
Long-term debt		1,143,000			1,641,700
Other long-term liabilities		841,600			861,500
Deferred income taxes		28,500			18,900
Commitments and contingencies
Shareholders’ investment:
Preferred stock, $1 par value, authorized 5,000,000 shares; none issued		—			—
Common stock, $0.25 par value, authorized 600,000,000 shares; issued and outstanding 72,417,180 shares at March 31, 2017 and 72,899,251 shares at December 31, 2016		18,100			18,200
Capital in excess of par value		2,389,300			2,346,800
Accumulated deficit		(513,500	)		(454,400	)
Accumulated other comprehensive loss		(222,100	)		(235,500	)
Total shareholders’ investment		1,671,800			1,675,100
Total liabilities and shareholders’ investment	$	5,244,600		$	5,306,100

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

C. R. BARD, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(dollars in thousands, unaudited)

	Three Months Ended March 31,
	2017			2016
Cash flows from operating activities:
Net income	$	178,100		$	116,200
Adjustments to reconcile net income to net cash provided by operating activities, net of acquired businesses:
Depreciation and amortization		51,000			53,000
Litigation charges, net		12,100			48,900
Restructuring and productivity initiative costs, net of payments		2,300			7,700
Deferred income taxes		36,200			20,900
Share-based compensation		27,200			26,200
Inventory reserves and provision for doubtful accounts		7,500			9,300
Other items		1,400			1,000
Changes in assets and liabilities, net of acquired businesses:
Accounts receivable		29,000			6,100
Inventories		(19,900	)		(21,300	)
Current liabilities		(121,900	)		(138,200	)
Taxes		(32,500	)		(40,100	)
Other, net		(29,900	)		(22,500	)
Net cash provided by operating activities		140,600			67,200
Cash flows from investing activities:
Capital expenditures		(22,700	)		(20,500	)
Payments made for purchases of businesses, net of cash acquired		(5,400	)		(202,800	)
Payments made for intangibles		(200	)		(200	)
Net cash used in investing activities		(28,300	)		(223,500	)
Cash flows from financing activities:
Change in short-term borrowings, net		110,000			525,600
Payment of long-term debt		—			(250,000	)
Proceeds from exercises under share-based compensation plans, net		(9,100	)		(6,500	)
Excess tax benefit relating to share-based compensation plans		—			19,000
Purchases of common stock		(232,300	)		(167,400	)
Dividends paid		(19,300	)		(18,000	)
Payments of contingent consideration		(100	)		(100	)
Net cash (used in) provided by financing activities		(150,800	)		102,600
Effect of exchange rate changes on cash, cash equivalents, and restricted cash		1,800			(1,600	)
Decrease in cash, cash equivalents, and restricted cash during the period		(36,700	)		(55,300	)
Balance at January 1		1,106,500			1,030,900
Balance at March 31	$	1,069,800		$	975,600
Supplemental cash flow information
Cash paid for:
Interest	$	15,000		$	16,600
Income taxes		19,700			26,900
Non-cash transactions:
Purchases of businesses and related costs	$	—		$	17,100

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

C. R. BARD, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of C. R. Bard, Inc. and its subsidiaries (the “company” or “Bard”) should be read in conjunction with the audited consolidated financial statements and notes thereto included in Bard’s 2016 Annual Report on Form 10-K. These financial statements have been prepared on a basis that is substantially consistent with the accounting principles applied in the financial statements in Bard’s 2016 Annual Report on Form 10-K. The preparation of these financial statements requires the company to make estimates and judgments that affect reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities at the date of the financial statements. These financial statements include all normal and recurring adjustments necessary for a fair presentation. The accounts of most foreign subsidiaries are consolidated as of and for the quarters ended February 28, 2017 and February 29, 2016 and as of November 30, 2016. No events occurred related to these foreign subsidiaries during the months of March 2017, March 2016 or December 2016 that materially affected the financial position or results of operations of the company. The results for the interim periods presented are not necessarily indicative of the results expected for the year.

Reclassifications

Certain prior year amounts have been reclassified to conform to current year presentation.

Recently Adopted Accounting Pronouncements

In January 2017, the Financial Accounting Standards Board (“FASB”) issued an accounting standard update that clarifies the definition of a business by providing a more robust framework to evaluate whether transactions should be accounted for as an acquisition of assets or a business. This update is expected to reduce the number of transactions that will be accounted for as an acquisition of a business. The effects of this update will depend on future acquisitions. In 2017, the company adopted this update early.

In November 2016, the FASB issued an accounting standard update that requires the change in the total of cash, cash equivalents, and restricted cash to be shown in the statement of cash flows. As a result, transfers between cash, cash equivalents, and restricted cash will no longer be presented in the statement of cash flows. In 2017, the company adopted this update early on a retrospective basis. As a result of the adoption, changes in restricted cash of $130.2 million are no longer presented as a reduction in cash flows from investing activities in the prior period statement of cash flows. Restricted cash is now included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts.

In October 2016, the FASB issued an accounting standard update that requires the immediate recognition of the income tax effects of intra-entity transfers of assets other than inventory at the time of the transfer. In 2017, the company adopted this update early on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. As a result of the adoption, accumulated deficit was increased by $5.2 million and other current assets and deferred tax liabilities were reduced by $5.4 million and $0.2 million, respectively, as of the beginning of 2017.

In March 2016, the FASB issued an accounting standard update that includes multiple provisions intended to simplify various aspects of the accounting for share-based payments, including the income tax items and the classification of these items on the statement of cash flows. This update will result in the recognition of excess tax benefits to the consolidated statements of income (formerly recorded to capital in excess of par value) upon settlement of share-based compensation awards, which is largely dependent on the exercise/vesting of awards and variables such as the company’s stock price at the time of the exercise/vesting of awards and the exercise price of the underlying awards. This provision of the new guidance, which was required to be applied prospectively, resulted in the recognition of $27.0 million of excess tax benefits in the income tax provision. In addition, cash flows related to these excess tax benefits are now classified as cash flows from operating activities (formerly included as cash flows from financing activities). The company elected to adopt this provision of the new guidance prospectively. Lastly, in the diluted earnings per share available to common shareholders calculation, when applying the treasury stock method for shares that could be repurchased, the assumed proceeds no longer include the amount of excess tax benefits. This did not have a material impact on the company’s diluted earnings per share available to common shareholders calculation.

7

C. R. BARD, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

New Accounting Pronouncements Not Yet Adopted

In March 2017, the FASB issued an accounting standard update that requires that the service cost component of net periodic pension cost be reported in the same income statement line items in which other compensation costs are reported and all other components of net periodic pension cost be reported elsewhere in the income statement. This update will be effective as of the beginning of Bard’s 2018 fiscal year and is not expected to have a material impact on the company’s consolidated financial statements.

In February 2016, the FASB issued a new lease accounting standard. The new standard will require, among other items, lessees to recognize most leases on the balance sheet by recording a right-of-use asset and a lease liability. This standard will be effective as of the beginning of Bard’s 2019 fiscal year. Other than this impact to the company’s consolidated balance sheet, the new standard is not expected to have a material impact on the company’s consolidated financial statements.

In May 2014, the FASB issued an accounting standard that provides for a comprehensive model to use in the accounting for revenue arising from contracts with customers. Under this standard, revenue will be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued an accounting standard update to defer this standard’s effective date for one year, which will now begin with Bard’s 2018 fiscal year. Under this standard, the company expects to recognize royalty revenue in earlier periods than under its current policy, and to recognize revenue earlier for other contracts that do not meet the new criteria for recognizing revenue over time. In addition, revenue will be recognized in earlier periods where the company maintains risk of loss for products that are in-transit to the customer. The company has made substantial progress in its evaluation of the new standard, and other than these items, this standard is not expected to have a material impact on the company’s consolidated financial statements. The company will continue to assess the new standard, as well as updates to the standard that have been proposed by the FASB. The company intends to adopt the standard under the modified retrospective approach beginning with Bard’s 2018 fiscal year.

2. Becton Dickinson Transaction

On April 23, 2017, Bard entered into Agreement and Plan of Merger (the “Merger Agreement”) with Becton, Dickinson and Company (“BD”) and Lambda Corp., a wholly owned subsidiary of BD (“Merger Corp”), pursuant to which Bard will merge with Merger Corp and become a wholly owned subsidiary of BD (the “Merger”). Under the agreement, each outstanding share of common stock of Bard will be converted into the right to receive $222.93 in cash and 0.5077 of a share of common stock of BD, as may be adjusted pursuant to the terms of the Merger Agreement. Completion of the Merger is subject to customary closing conditions, including, among others, (1) the approval of the Merger Agreement by a majority of the votes cast by Bard’s shareholders at a special meeting held to vote on the Merger Agreement, among other items, (2) declaration of the effectiveness by the U.S. Securities and Exchange Commission (the “SEC”) of the Registration Statement on Form S-4 to be filed with the SEC by BD in connection with the shares of the stock of BD to be issued in the Merger, (3) approval for listing on the New York Stock Exchange of the stock of BD to be issued in the Merger, (4) obtaining antitrust approvals in the United States and certain other jurisdictions, (5) subject to certain exceptions, the accuracy of the representations and warranties of the other party and (6) material compliance by the other party with its obligations under the Merger Agreement. The transaction is expected to close in the fourth quarter of 2017. If the Merger Agreement is terminated, Bard may be required to pay BD an amount equal to fifty percent of BD’s out-of-pocket expenses incurred in connection with the Merger Agreement and the Merger and in certain other circumstances, Bard may be required to pay BD a termination fee of $750 million. The foregoing description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement attached as Exhibit 2.1 to the Form 8-K filed on April 24, 2017.

8

C. R. BARD, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

3. Earnings per Common Share

Earnings per share (“EPS”) is computed under the two-class method using the following common share information:

	Three Months Ended March 31,
	2017		2016
(dollars and shares in millions)
EPS Numerator:
Net income	$	178.1	$	116.2
Less: Income allocated to participating securities		0.9		0.6
Net income available to common shareholders	$	177.2	$	115.6
EPS Denominator:
Weighted average common shares outstanding		73.1		74.0
Dilutive common share equivalents from share-based compensation plans		1.6		1.2
Weighted average common and common equivalent shares outstanding, assuming dilution		74.7		75.2

4. Income Taxes

The effective tax rate for the quarter ended March 31, 2017 was 11.6%. As discussed in Note 1 of the notes to condensed consolidated financial statements, the company adopted an accounting standard update that resulted in the recognition of excess tax benefits to the income tax provision upon settlement of share-based compensation awards. As a result, the effective tax rate for the quarter ended March 31, 2017 reflected a benefit of $27.0 million partially offset by the discrete tax effects of litigation charges.

The effective tax rate for the quarter ended March 31, 2016 was 18.7% which reflected the discrete tax effects of litigation charges related to product liability claims, which were incurred in a high tax jurisdiction. See Note 7 of the notes to condensed consolidated financial statements.

At March 31, 2017, the total amount of liability for unrecognized tax benefits related to federal, state and foreign taxes was $21.9 million (of which $18.8 million would impact the effective tax rate, if recognized) plus $2.9 million of accrued interest. At December 31, 2016, the liability for unrecognized tax benefits was $21.5 million plus $2.6 million of accrued interest. Depending upon the result of open tax examinations and/or the expiration of applicable statutes of limitation, the company believes it is reasonably possible that the total amount of unrecognized tax benefits may decrease by up to $4.9 million within the next 12 months.

5. Financial Instruments

For further discussion regarding the company’s use of derivative instruments, see Note 1 of the notes to consolidated financial statements in Bard’s 2016 Annual Report on Form 10-K.

Foreign Exchange Derivative Instruments

The company enters into readily marketable forward and option contracts with financial institutions to help reduce its exposure to foreign currency exchange rate fluctuations. These contracts limit volatility because gains and losses associated with foreign currency exchange rate movements are generally offset by movements in the underlying hedged item. The notional value of the company’s forward currency contracts was $218.6 million and $243.2 million at March 31, 2017 and December 31, 2016, respectively.

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C. R. BARD, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The location and fair value of derivative instruments that are designated as hedging instruments recognized in the condensed consolidated balance sheets are as follows:

	Balance Sheet Location		Fair Value of Derivatives
Derivatives Designated as Hedging Instruments			March 31, 2017		December 31, 2016
(dollars in millions)
Forward currency contracts		Other current assets	$	9.2	$	10.9
Forward currency contracts		Other assets		4.2		3.9
			$	13.4	$	14.8
Forward currency contracts		Accrued expenses	$	0.6	$	6.2
			$	0.6	$	6.2

The location and amounts of gains and losses on derivative instruments designated as cash flow hedges and the impact on shareholders’ investment are as follows:

	Gain/(Loss) Recognized in Other Comprehensive Income (Loss)					Location of Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income		Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
	Three Months Ended March 31,							Three Months Ended March 31,
	2017		2016					2017			2016
(dollars in millions)
Forward currency contracts	$	5.2	$	(0.8	)		Cost of goods sold	$	(3.3	)	$	(2.4	)
Option currency contracts		—		(1.7	)		Cost of goods sold		(0.4	)		1.8
Interest rate swap contract		—		(14.5	)		Interest expense		(0.6	)		—
	$	5.2	$	(17.0	)			$	(4.3	)	$	(0.6	)

Financial Instruments Measured at Fair Value on a Recurring Basis

Fair value is defined as the exit price that would be received to sell an asset or paid to transfer a liability. Fair value is a market-based measurement that is determined using assumptions that market participants would use in pricing an asset or liability. The fair value guidance establishes a three-level hierarchy which maximizes the use of observable inputs and minimizes the use of unobservable inputs used in measuring fair value. The levels within the hierarchy range from Level 1 having observable inputs to Level 3 having unobservable inputs.

The fair values of the company’s forward currency contracts of $12.8 million and $8.6 million at March 31, 2017 and December 31, 2016, respectively, were measured using significant other observable inputs and valued by reference to similar financial instruments, adjusted for restrictions and other terms specific to each instrument. These financial instruments are categorized as Level 2 under the fair value hierarchy.

The fair value of the liability for contingent consideration related to acquisitions was $14.8 million and $14.9 million at March 31, 2017 and December 31, 2016, respectively. The fair value was measured using significant unobservable inputs and is categorized as Level 3 under the fair value hierarchy.

Financial Instruments Not Measured at Fair Value

The company maintains a $1 billion five-year committed syndicated bank credit facility that expires in November 2021. The credit facility supports the company’s commercial paper program and can be used for general corporate purposes. The facility includes pricing based on the company’s long-term credit ratings and includes a financial covenant that limits the amount of total debt to total capitalization. At March 31, 2017 the company was in compliance with this covenant. The fair value of commercial paper borrowings outstanding of $110.0 million at March 31, 2017 approximated its carrying value. There were no commercial paper borrowings outstanding at December 31, 2016.

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C. R. BARD, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The estimated fair value of long-term debt (including current maturities) was approximately $1,695.2 million and $1,688.0 million at March 31, 2017 and December 31, 2016, respectively. The fair value was estimated using dealer quotes for similarly-rated debt instruments over the remaining contractual term of the company’s obligation and is categorized as Level 2 under the fair value hierarchy.

The fair value of the deferred future payments related to the Medicon, Inc. acquisition of $54.8 million and $52.3 million at March 31, 2017 and December 31, 2016, respectively, approximated the carrying value. At March 31, 2017 and December 31, 2016, future payments of $41.4 million and $39.5 million, respectively, were recorded to other long-term liabilities. These payments will be paid in Japanese Yen and are subject to exchange rate fluctuations. The fair value was estimated by discounting the future payments based upon the timing of such payments and is categorized as Level 2 under the fair value hierarchy.

Concentration Risk

Accounts receivable balances include sales to government-supported healthcare systems outside the United States. The company monitors economic conditions and evaluates accounts receivable in certain countries for potential collection risks. Economic conditions and other factors in certain countries, particularly in Spain, Italy, Greece and Portugal, have resulted in, and may continue to result in, an increase in the average length of time that it takes to collect these accounts receivable and may require the company to re-evaluate the collectability of these receivables in future periods. At March 31, 2017, the company’s accounts receivable, net of allowances, from the national healthcare systems and private sector customers in these four countries was $40.1 million, of which $1.9 million was greater than 365 days past due.

6. Inventories

Inventories consisted of:

	March 31, 2017		December 31, 2016
(dollars in millions)
Finished goods	$	296.9	$	292.8
Work in process		35.5		27.0
Raw materials		164.8		163.2
	$	497.2	$	483.0

7. Contingencies

In the ordinary course of business, the company is subject to various legal proceedings, investigations and claims, including, for example, environmental matters, employment disputes, disputes on agreements and other commercial disputes. In addition, the company operates in an industry susceptible to significant product liability and patent legal claims. The company accounts for estimated losses with respect to legal proceedings and claims when such losses are probable and reasonably estimable. If the estimate of a probable loss is a range and no amount within the range is more likely, the company accrues the minimum amount of the range. Legal costs associated with these matters are expensed as incurred. At any given time, in the ordinary course of business, the company is involved as either a plaintiff or defendant in a number of patent infringement actions. If a third party’s patent infringement claim were to be determined against the company, the company might be required to make significant royalty or other payments or might be subject to an injunction or other limitation on its ability to manufacture or distribute one or more products. If a patent owned by or licensed to the company is found to be invalid or unenforceable, the company might be required to reduce the value of certain intangible assets on the company’s balance sheet and to record a corresponding charge, which could be significant in amount. Many of the company’s legal proceedings and claims could have a material adverse effect on its business, results of operations, financial condition and/or liquidity.

Product Liability Matters

Hernia Product Claims

As of March 31, 2017, approximately 25 federal and 80 state lawsuits involving individual claims by approximately 105 plaintiffs, as well as one putative class action in the United States, are currently pending against the company with respect to its

11

C. R. BARD, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Composix^® Kugel^® and certain other hernia repair implant products (collectively, the “Hernia Product Claims”). The company voluntarily recalled certain sizes and lots of the Composix^® Kugel^® products beginning in December 2005. In June 2007, the Composix^® Kugel^® lawsuits and, subsequently, other hernia repair product lawsuits, pending in federal courts nationwide were transferred into one Multidistrict Litigation (“MDL”) for coordinated pre-trial proceedings in the United States District Court for the District of Rhode Island. The MDL stopped accepting new cases in the second quarter of 2014 and was terminated in November 2016, at which time the remaining federal lawsuits were remanded to their courts of original jurisdiction for trial. As of March 31, 2017, all but one of the putative class actions pending against the company was dismissed. The remaining putative class action pending against the company has not been certified and seeks: (i) medical monitoring; (ii) compensatory damages; (iii) punitive damages; (iv) a judicial finding of defect and causation; and/or (v) attorneys’ fees. In April 2014, a settlement was reached with respect to the three putative Canadian class actions within amounts previously recorded by the company. Approximately 70 of the state lawsuits, involving individual claims by approximately 70 plaintiffs, are pending in the Superior Court of the State of Rhode Island, with the remainder in various other jurisdictions. The Hernia Product Claims also generally seek damages for personal injury resulting from use of the products.

The company has resolved the majority of its historical Hernia Product Claims, including through agreements or agreements in principle with various plaintiffs’ law firms to settle their respective inventories of cases. Each agreement involving the settlement of a firm’s inventory of claims was subject to certain conditions, including requirements for participation in the proposed settlements by a certain minimum number of plaintiffs. In addition, the company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Hernia Product Claims, and intends to vigorously defend Hernia Product Claims that do not settle, including through litigation. The company expects additional trials of Hernia Product Claims to take place over the next 12 months. The company cannot give any assurances that the resolution of the Hernia Product Claims that have not settled, including asserted and unasserted claims and the putative class action lawsuit, will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Women’s Health Product Claims

As of March 31, 2017, product liability lawsuits involving individual claims by approximately 5,305 plaintiffs are currently pending against the company in various federal and state jurisdictions alleging personal injuries associated with the use of certain of the company’s surgical continence products for women, which includes products manufactured by both the company and two subsidiaries of Medtronic plc (as successor in interest to Covidien plc) (“Medtronic”), each a supplier of the company. Medtronic has an obligation to defend and indemnify the company with respect to any product defect liability for products its subsidiaries had manufactured. As described below, in July 2015 the company reached an agreement with Medtronic regarding certain aspects of Medtronic’s indemnification obligation. In addition, five putative class actions in the United States and five putative class actions in Canada have been filed against the company, and a limited number of other claims have been filed or asserted in various non-U.S. jurisdictions. The foregoing lawsuits, unfiled or unknown claims, putative class actions and other claims, together with claims that have settled or are the subject of agreements or agreements in principle to settle, are referred to collectively as the “Women’s Health Product Claims”. The Women’s Health Product Claims generally seek damages for personal injury resulting from use of the products. The putative class actions, none of which has been certified, seek: (i) medical monitoring; (ii) compensatory damages; (iii) punitive damages; (iv) a judicial finding of defect and causation; and/or (v) attorneys’ fees. In April 2015, the Ontario Superior Court of Justice dismissed the plaintiffs’ motion for class certification in one Canadian putative class action. In March 2016, the company reached an agreement in principle to resolve all Canadian putative class actions, with the exception of a Quebec class action, within amounts previously recorded by the company, which settlement was finalized in September 2016. In January 2017, the court approved the discontinuance of the proposed Quebec class action.

In October 2010, the Women’s Health Product Claims involving solely Avaulta^® products pending in federal courts nationwide were transferred into an MDL in the United States District Court for the Southern District of West Virginia (the “WV District Court”), the scope of which was later expanded to include lawsuits involving all women’s surgical continence products that are manufactured or distributed by the company. The first trial in a state court was completed in California in July 2012 and resulted in a judgment against the company of approximately $3.6 million. On appeal the decision was affirmed by the appellate court in November 2014. The company filed a petition for review to the California Supreme Court on December 24, 2014, which was denied on February 18, 2015. The judgment in this matter, including interest and costs, was paid on March 20, 2015 within the amounts previously recorded by the company. The first trial in the MDL commenced in July 2013 and resulted in a judgment against the company of approximately $2 million, which was upheld by the Fourth Circuit on January 14, 2016. The company does not believe that any verdicts entered to date are representative of potential outcomes of all Women’s Health Product Claims. On January 16, 2014 and July 31, 2014, the WV District Court ordered that the company prepare 200 and then an additional 300 individual cases, respectively, for trial (the “2014

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

WHP Pre-Trial Orders”). The 2014 WHP Pre-Trial Orders resulted in significant additional litigation-related defense costs beginning in the second quarter of 2014 and continuing through the second quarter of 2015. In February 2015, the WV District Court appointed a Special Master to assist with settlement resolution. In June 2015, the WV District Court issued an order staying the requirement to prepare a significant portion of the cases covered by the 2014 WHP Pre-Trial Orders. Substantially all of the 500 individual cases that are the subject of the 2014 WHP Pre-Trial Orders have been part of agreements or agreements in principle to settle with various plaintiff law firms. In December 2016, the WV District Court lifted the stay of the 2014 WHP Pre-Trial Orders and remanded five of the unsettled cases to their courts of original jurisdiction for trial. In the first quarter of 2017, an additional 11 cases were remanded for trial for a total of 16 remanded cases. Five of those cases have been assigned trial dates between the third quarter of 2017 and the first quarter of 2018. In response to court orders on January 27, 2017 and March 3, 2017, the company is required to prepare an additional approximately 540 individual cases for trial (together with the 2014 WHP Pre-Trial Orders, the “WHP Pre-Trial Orders”). The WHP Pre-Trial Orders may result in material additional cost in future periods in defending Women’s Health Product Claims. The WV District Court may also order that the company prepare additional cases for trial, which could result in material additional costs in future periods.

As of March 31, 2017, the company reached agreements or agreements in principle with various plaintiffs’ law firms to settle their respective inventories of cases totaling approximately 11,005 Women’s Health Product Claims, including approximately: 560 during 2014, 6,215 during 2015, 4,155 during 2016 and approximately 75 during 2017. The company believes that these Women’s Health Product Claims are not the subject of Medtronic’s indemnification obligation. These settlement agreements and agreements in principle include unfiled and previously unknown claims held by various plaintiffs’ law firms, which have not been included in the approximate number of lawsuits set forth in the first paragraph of this section. Each agreement is subject to certain conditions, including requirements for participation in the proposed settlements by a certain minimum number of plaintiffs. The company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Women’s Health Product Claims, which may include additional inventory settlements. Notwithstanding these settlement efforts, the company anticipates additional trials over the next 12 months. In addition, one or more possible consolidated trials may occur in the future.

In July 2015, as part of the agreement noted above, Medtronic agreed to take responsibility for pursuing settlement of certain of the Women’s Health Product Claims that relate to products distributed by the company under supply agreements with Medtronic and the company has paid Medtronic $121 million towards these potential settlements. The company also may, in its sole discretion, transfer responsibility for settlement of additional Women’s Health Product Claims to Medtronic on similar terms. The agreement does not resolve the dispute between the company and Medtronic with respect to Women’s Health Product Claims that do not settle, if any. As part of the agreement, Medtronic and the company agreed to dismiss without prejudice their previously filed litigation with respect to Medtronic’s obligation to defend and indemnify the company.

The approximate number of lawsuits set forth in the first paragraph of this section does not include approximately 590 generic complaints involving women’s health products where the company cannot, based on the allegations in the complaints, determine whether any of those cases involve the company’s women’s health products. In addition, the approximate number of lawsuits set forth in the first paragraph of this section does not include approximately 865 claims that have been threatened against the company but for which complaints have not yet been filed. In addition, the company has limited information regarding the nature and quantity of these and other unfiled or unknown claims. During the course of engaging in settlement discussions with plaintiffs’ law firms, the company has learned, and may in future periods learn, additional information regarding these and other unfiled or unknown claims, or other lawsuits, which could materially impact the company’s estimate of the number of claims or lawsuits against the company. While the company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Women’s Health Product Claims and intends to vigorously defend the Women’s Health Product Claims that do not settle, including through litigation, it cannot give any assurances that the resolution of these claims will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Filter Product Claims

As of March 31, 2017, product liability lawsuits involving individual claims by approximately 1,755 plaintiffs are currently pending against the company in various federal and state jurisdictions alleging personal injuries associated with the use of the company’s vena cava filter products (all lawsuits, collectively, the “Filter Product Claims”). In August 2015, the Judicial Panel for Multi-District Litigation (“JPML”) ordered the creation of a Multi-District Litigation for all federal Filter Product Claims (the “IVC Filter MDL”) in the District of Arizona. There are approximately 1,705 Filter Product Claims that have been, or shortly will be, transferred to the IVC Filter MDL, including one medical monitoring class action. The remaining approximately 45 Filter Product Claims are pending in various state courts. In March 2016, a putative Canadian class action was filed against the company in Quebec.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

In April 2016 and May 2016, putative Canadian class actions were filed in Ontario and British Columbia, respectively. In November 2016, a putative Canadian class action was filed in Saskatchewan. The approximate number of lawsuits set forth above does not include approximately 25 claims that have been threatened against the company but for which complaints have not yet been filed. In addition, the company has limited information regarding the nature and quantity of these and other unfiled or unknown claims. The company continues to receive claims and lawsuits and may in future periods learn additional information regarding other unfiled or unknown claims, or other lawsuits, which could materially impact the company’s estimate of the number of claims or lawsuits against the company. The company expects that trials of Filter Product Claims may take place over the next 12 months. While the company intends to vigorously defend Filter Product Claims that do not settle, including through litigation, it cannot give any assurances that the resolution of these claims will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

General

In most product liability litigations (like those described above), plaintiffs allege a wide variety of claims, ranging from allegations of serious injury caused by the products to efforts to obtain compensation notwithstanding the absence of any injury. In many of these cases, the company has not yet received and reviewed complete information regarding the plaintiffs and their medical conditions and, consequently, is unable to fully evaluate the claims. The company expects that it will receive and review additional information regarding any remaining unsettled product liability matters.

The company believes that some settlements and judgments, as well as some legal defense costs, relating to product liability matters are or may be covered in whole or in part under its product liability insurance policies with a limited number of insurance carriers, or, in some circumstances, indemnification obligations to the company from other parties, which if disputed, the company intends to vigorously contest. Amounts recovered under the company’s product liability insurance policies or indemnification arrangements may be less than the stated coverage limits or less than otherwise expected and may not be adequate to cover damages and/or costs relating to claims. In addition, there is no guarantee that insurers or other parties will pay claims or that coverage or indemnity will be otherwise available.

In January 2017, the company reached an agreement to resolve litigation filed in the Southern District of New York by its insurance carriers in connection with Women’s Health Product Claims and Filter Product Claims. The agreement requires the insurance carriers to reimburse the company for certain future costs incurred in connection with Filter Product Claims up to an agreed amount. For certain product liability claims or lawsuits, the company does not maintain or has limited remaining insurance coverage.

Other Legal Matters

Since early 2013, the company has received subpoenas or Civil Investigative Demands from a number of State Attorneys General seeking information related to the sales and marketing of certain of the company’s products that are the subject of the Hernia Product Claims and the Women’s Health Product Claims. The company is cooperating with these requests. Although the company has had discussions with the State Attorneys General with respect to overall potential resolution of this matter, there can be no assurance that a resolution will be reached or what the terms of any such resolution may be. In the first quarter of 2017, the company recorded a charge to other (income) expense, net, of $7.5 million ($7.5 million after tax). Since it is not feasible to predict the outcome of these proceedings, the company cannot give any assurances that the resolution of these proceedings will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

In November 2015, the Department of Defense Inspector General issued an investigative subpoena to the company. The Department of Health and Human Services is also participating in this investigation. The subpoena seeks documents related to the company’s sales and marketing of certain filter products, drug coated balloon catheters, and peripheral arterial disease detection products. The company is cooperating with these requests. Since it is not feasible to predict the outcome of these proceedings, the company cannot give any assurances that the resolution of these proceedings will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

In June 2011, W. L. Gore & Associates, Inc. (“Gore”) filed suit in the U.S. District Court in Delaware alleging the company had infringed several of Gore’s patents. The trial began March 1, 2017, and was phased such that liability issues would be heard and decided by the jury first, with damages and willfulness to be heard immediately thereafter, if necessary. The liability phase was completed on March 8, 2017 with the jury finding the asserted Gore patent not valid and not infringed. Gore has the option to appeal and/or request a new trial or that the jury’s verdict be set aside. It is unclear what options Gore may choose or the outcome of the

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

matter. The company intends to vigorously defend the allegations asserted by Gore. The company cannot give any assurances that an adverse resolution of this matter will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

The company is subject to numerous federal, state, local and foreign environmental protection laws governing, among other things, the generation, storage, use and transportation of hazardous materials and emissions or discharges into the ground, air or water. The company is or may become a party to proceedings brought under various federal laws including the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), commonly known as Superfund, the Resource Conservation and Recovery Act, the Clean Water Act, the Clean Air Act and similar state or foreign laws. These proceedings seek to require the owners or operators of contaminated sites, transporters of hazardous materials to the sites and generators of hazardous materials disposed of at the sites to clean up the sites or to reimburse the government for cleanup costs. In most cases, there are other potentially responsible parties that may be liable for remediation costs. In these cases, the government alleges that the defendants are jointly and severally liable for the cleanup costs; however, these proceedings are frequently resolved so that the allocation of cleanup costs among the parties more closely reflects the relative contributions of the parties to the site contamination. The company’s potential liability varies greatly from site to site. For some sites, the potential liability is de minimis and for others the costs of cleanup have not yet been determined. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than completion of the remedial feasibility study and are adjusted as further information develops or circumstances change. Costs of future expenditures for environmental remediation obligations are not discounted to their present value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable. The company believes that the proceedings and claims described above will likely be resolved over an extended period of time. While it is not feasible to predict the outcome of these proceedings, based upon the company’s experience, current information and applicable law, the company does not expect these proceedings to have a material adverse effect on its financial condition and/or liquidity. However, one or more of the proceedings could be material to the company’s business and/or results of operations.

Litigation Reserves

The company regularly monitors and evaluates the status of product liability and other legal matters, and may, from time-to-time, engage in settlement and mediation discussions taking into consideration developments in the matters and the risks and uncertainties surrounding litigation. These discussions could result in settlements of one or more of these claims at any time.

In the second quarter of 2015, the company recorded an additional charge related to these matters, net of estimated recoveries to other (income) expense, net, of approximately $337 million ($325 million after tax). The company recorded this charge based on additional information obtained during the quarter, including with respect to the factors noted above. Specifically the company considered the agreement and the agreement in principle by the company to settle approximately 2,880 Women’s Health Product Claims, the involvement of the Special Master in settlement resolution, additional settlements by other manufacturers subject to product liability claims with respect to similar products, and the continued rate of claims being filed (which led the company to increase its estimate of future Women’s Health Product Claims).

In the third quarter of 2015, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $241 million ($228 million after tax). The company recorded this charge based on additional information obtained with respect to the quarter, including with respect to the factors noted above. Specifically, the company considered the agreements and the agreement in principle by the company to settle approximately 3,030 Women’s Health Product Claims, discussions with plaintiffs’ counsel, additional information learned regarding the nature and quantity of unfiled and unknown claims (which led the company to increase its estimate of future Women’s Health Product Claims), a reconciliation of claims in connection with settlements, additional settlements by other manufacturers subject to product liability claims with respect to similar products, the rate of claims being filed, and the creation of the IVC Filter MDL.

In the first quarter of 2016, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $49 million ($31 million after tax). The company recorded this charge based on additional information obtained with respect to the quarter. Specifically, the company considered, among other factors, additional information learned regarding the nature and quantity of unfiled and filed claims, the increase in advertising by plaintiffs’ counsel with respect to IVC filters and an increase in the rate of claims being filed in Filter Product Claims (which led the company to increase its estimate of future Filter Product Claims).

In the third quarter of 2016, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $111 million ($77 million after tax). The company recorded this charge based on additional information obtained with

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

respect to the quarter, including with respect to the factors noted above. Specifically, the company considered, among other factors, additional information learned regarding Product Liability Matters, including regarding the nature and quantity of unfiled and filed claims and the continued rate of claims being filed in certain Product Liability Matters (which led the company to increase its estimate of future claims for certain Product Liability Matters, including Filter Product Claims).

In the fourth quarter of 2016, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $46 million ($31 million after tax). The company recorded this charge based on additional information obtained with respect to the quarter, including regarding cases settled by certain other manufacturers, public information available from the court, unfiled and filed claims, the status of certain settlement discussions and information regarding plaintiff law firm inventories.

These charges recognized the estimated costs for the product liability matters discussed above, including (with respect to such matters) filed and an estimate of unfiled and unknown claims, and costs to administer the settlements related to such matters. These charges exclude any costs associated with certain of the putative class action lawsuits in the United States and Canada.

The company cannot give any assurances that the actual costs incurred with respect to these product liability matters will not exceed the related amounts accrued. With respect to product liability claims that are not resolved through settlement, the company intends to vigorously defend against such claims, including through litigation. The company cannot give any assurances that the resolution of any of its product liability matters, including filed, unfiled and unknown claims and the putative class action lawsuits, will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Accruals for product liability and other legal matters amounted to $1,150.6 million, of which $563.4 million was recorded to accrued expenses, and $1,201.5 million, of which $605.3 million was recorded to accrued expenses, at March 31, 2017 and December 31, 2016, respectively. The company has made total payments of $795.0 million to qualified settlement funds (“QSFs”), subject to certain settlement conditions, for certain product liability matters since 2011, of which $32.6 million were made to QSFs during the three months ended March 31, 2017. Payments to QSFs are recorded as a component of restricted cash. Total payments of $617.7 million from these QSFs have been made to qualified claimants, of which $55.0 million were made during the three months ended March 31, 2017. In addition, other payments of $78.1 million have been made to qualified claimants, of which $4.8 million were made during the three months ended March 31, 2017.

The company recorded expected recoveries related to product liability matters amounting to $261.6 million, of which $163.3 million was recorded to other current assets, and $267.3 million, of which $156.2 million was recorded to other current assets, at March 31, 2017 and December 31, 2016, respectively. A substantial amount of these expected recoveries at March 31, 2017 and December 31, 2016 relate to the company’s agreements with Medtronic related to certain Women’s Health Product Claims. The terms of the company’s agreement with Medtronic are substantially consistent with the assumptions underlying, and the manner in which, the company has recorded expected recoveries related to the indemnification obligation. The expected recoveries at March 31, 2017 and December 31, 2016 related to the indemnification obligation are not in dispute with respect to claims that Medtronic settles pursuant to the agreement. As described above, the agreement does not resolve the dispute between the company and Medtronic with respect to Women’s Health Product Claims that do not settle, if any, and the company also may, in its sole discretion, transfer responsibility for settlement of additional Women’s Health Product Claims to Medtronic on similar terms.

The company is unable to estimate the reasonably possible losses or range of losses, if any, arising from certain existing product liability matters and other legal matters. Under U.S. generally accepted accounting principles, an event is “reasonably possible” if “the chance of the future event or events occurring is more than remote but less than likely” and an event is “remote” if “the chance of the future event or events occurring is slight”. With respect to putative class action lawsuits in the United States and certain of the Canadian lawsuits relating to product liability matters, the company is unable to estimate a range of reasonably possible losses for the following reasons: (i) all or certain of the proceedings are in early stages; (ii) the company has not received and reviewed complete information regarding all or certain of the plaintiffs and their medical conditions; and/or (iii) there are significant factual issues to be resolved. In addition, there is uncertainty as to the likelihood of a class being certified or the ultimate size of the class. With respect to the investigative subpoena issued by the Department of Defense Inspector General and the Department of Health and Human Services, the company is unable to estimate a range of reasonably possible losses for the following reasons: (i) all or certain of the proceedings are in early stages; and/or (ii) there are significant factual and legal issues to be resolved.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

8. Share-Based Compensation Plans

The company may grant a variety of share-based payments under the 2012 Long Term Incentive Plan of C. R. Bard, Inc., as amended and restated (the “LTIP”) and the 2005 Directors’ Stock Award Plan of C. R. Bard, Inc., as amended and restated (the “Directors’ Plan”) to certain directors, officers and employees. The total number of remaining shares at March 31, 2017 that may be issued under the LTIP was 2,899,995 and under the Directors’ Plan was 21,890. Awards under the LTIP may be in the form of stock options, stock appreciation rights, limited stock appreciation rights, restricted stock, unrestricted stock and other stock-based awards. Awards under the Directors’ Plan may be in the form of stock awards, stock options or stock appreciation rights. The company also has two employee stock purchase programs.

For the quarters ended March 31, 2017 and 2016, amounts charged against income for share-based payment arrangements were $27.2 million and $26.2 million, respectively.

In the first quarter of each of 2017 and 2016, the company granted performance restricted stock units to certain officers. These units have requisite service periods of three years and have no dividend rights. The actual payout of these units varies based on the company’s performance over the three-year period based on pre-established targets over the period and a market condition modifier based on total shareholder return (“TSR”) compared to an industry peer group. The actual payout under these awards may exceed an officer’s target payout; however, compensation cost initially recognized assumes that the target payout level will be achieved and may be adjusted for subsequent changes in the expected outcome of the performance-related condition. The fair values of these units are based on the market price of the company’s stock on the date of the grant and use a Monte Carlo simulation model for the TSR component. The fair values of the TSR components of the 2017 and 2016 grants were estimated based on the following assumptions: risk-free interest rate of 1.37% and 0.83%, respectively; dividend yield of 0.47% and 0.52%, respectively; and expected life of 2.89 for both valuations.

As of March 31, 2017, there were $141.5 million of unrecognized compensation expenses related to share-based payment arrangements. These costs are expected to be recognized over a weighted-average period of approximately three years. The company has sufficient shares to satisfy expected share-based payment arrangements in 2017.

9. Pension Plans

The company has both tax-qualified and nonqualified, noncontributory defined benefit pension plans, that together cover certain domestic and foreign employees. These plans provide benefits based upon a participant’s compensation and years of service.

The components of net periodic pension cost are as follows:

	Three Months Ended March 31,
	2017			2016
(dollars in millions)
Service cost, net of employee contributions	$	6.6		$	7.3
Interest cost		4.8			4.7
Expected return on plan assets		(8.3	)		(8.1	)
Amortization		3.3			2.6
Net periodic pension cost	$	6.4		$	6.5

10. Shareholders’ Investment

The company repurchased approximately 1.0 million shares of common stock for $232.3 million in the three months ended March 31, 2017 under its previously announced share repurchase authorization.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Other Comprehensive Income (Loss)

The changes in accumulated other comprehensive income (loss) by component are as follows:

	Derivative Instruments Designated as Cash Flow Hedges			Foreign Currency Translation Adjustments			Benefit Plans			Total
(dollars in millions)
Balance at December 31, 2015	$	(8.7	)	$	(94.2	)	$	(105.1	)	$	(208.0	)
Other comprehensive income (loss) before reclassifications		(15.9	)		1.6			—			(14.3	)
Tax (provision) benefit (a)		5.5			—			—			5.5
Other comprehensive income (loss) before reclassifications, net of taxes		(10.4	)		1.6			—			(8.8	)
Reclassifications		0.6	(b)		—			2.6	(c)		3.2
Tax provision (benefit)		0.6			—			(0.9	)		(0.3	)
Reclassifications, net of tax		1.2			—			1.7			2.9
Other comprehensive income (loss)		(9.2	)		1.6			1.7			(5.9	)
Balance at March 31, 2016	$	(17.9	)	$	(92.6	)	$	(103.4	)	$	(213.9	)
Balance at December 31, 2016	$	(9.9	)	$	(116.0	)	$	(109.6	)	$	(235.5	)
Other comprehensive income (loss) before reclassifications		1.4			4.6			—			6.0
Tax (provision) benefit (a)		1.6			—			—			1.6
Other comprehensive income (loss) before reclassifications, net of taxes		3.0			4.6			—			7.6
Reclassifications		4.3	(b)		—			3.3	(c)		7.6
Tax provision (benefit)		(0.7	)		—			(1.1	)		(1.8	)
Reclassifications, net of tax		3.6			—			2.2			5.8
Other comprehensive income (loss)		6.6			4.6			2.2			13.4
Balance at March 31, 2017	$	(3.3	)	$	(111.4	)	$	(107.4	)	$	(222.1	)

(a) Income taxes are not provided for foreign currency translation adjustment.

(b) See Note 5 of the notes to condensed consolidated financial statements.

(c) These components are included in the computation of net periodic pension cost. See Note 9 of the notes to condensed consolidated financial statements.

11. Segment Information

The company’s management considers its business to be a single segment entity – the manufacture and sale of medical devices. The company’s products generally share similar distribution channels and customers. The company designs, develops, manufactures, packages, distributes and sells medical, surgical, diagnostic and patient care devices. The company sells a broad range of products to hospitals, individual healthcare professionals, extended care health facilities and alternate site facilities on a global basis. In general, the company’s products are intended to be used once and then discarded or either temporarily or permanently implanted. The company’s chief operating decision makers evaluate their various global product portfolios on a net sales basis and generally evaluate profitability and associated investment on an enterprise-wide basis due to shared geographic infrastructures.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Net sales based on the location of external customers by geographic region are:

	Three Months Ended March 31,
	2017		2016
(dollars in millions)
United States	$	657.2	$	625.4
Europe		103.2		104.3
Asia-Pacific(A)		126.3		97.9
Other(A)		52.1		45.9
	$	938.8	$	873.5

(A) Beginning in the fourth quarter of 2016, net sales for Asia-Pacific are separately reported. Prior year amount have been reclassified to conform to current year presentation.

Total net sales by product group category are:

	Three Months Ended March 31,
	2017		2016
(dollars in millions)
Vascular	$	256.6	$	239.5
Urology		237.7		216.7
Oncology		255.5		241.9
Surgical Specialties		165.1		151.4
Other		23.9		24.0
	$	938.8	$	873.5

19

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This management’s discussion and analysis provides a review of the results of operations, financial condition and the liquidity and capital resources of C. R. Bard, Inc. and its subsidiaries (the “company” or “Bard”). The following discussion should be read in conjunction with Bard’s 2016 Annual Report on Form 10-K, and the condensed consolidated financial statements and notes thereto included elsewhere in this Form 10-Q. Certain statements contained herein may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995; see “Risks and Uncertainties; Cautionary Statement Regarding Forward-Looking Information” below.

Overview

The company designs, develops, manufactures, packages, distributes and sells medical, surgical, diagnostic and patient care devices. The company sells a broad range of products to hospitals, individual healthcare professionals, extended care health facilities and alternate site facilities on a global basis. Outside the United States, Europe, Japan and China are the company’s largest markets, while certain emerging markets in Asia, Latin America, and Eastern Europe are the company’s fastest-growing markets. In general, the company’s products are intended to be used once and then discarded or either temporarily or permanently implanted. The company reports sales in four major product group categories: vascular; urology; oncology; and surgical specialties. The company also has a product group category of other products.

The company’s earnings are driven by its ability to continue to generate sales of its products and improve operating efficiency. Bard’s ability to increase sales over time depends upon its success in developing, acquiring and marketing differentiated products that meet the needs of clinicians and their patients. For the three months ended March 31, 2017, the company’s research and development (“R&D”) expense as a percentage of net sales was 7.5%. The company also makes selective acquisitions of businesses, products and technologies, generally focusing on small-to-medium sized transactions to provide ongoing growth opportunities. In addition, the company may from time-to-time consider acquisitions of larger, established companies. The company may also periodically divest lines of business in which it is not able to reasonably attain or maintain a leadership position in the market or for other strategic reasons.

Recent Developments

Becton Dickinson Transaction

On April 23, 2017, Bard entered into Agreement and Plan of Merger (the “Merger Agreement”) with Becton, Dickinson and Company (“BD”) and Lambda Corp., a wholly owned subsidiary of BD (“Merger Corp”), pursuant to which Bard will merge with Merger Corp and become a wholly owned subsidiary of BD (the “Merger”). Under the agreement, each outstanding share of common stock of Bard will be converted into the right to receive $222.93 in cash and 0.5077 of a share of common stock of BD, as may be adjusted pursuant to the terms of the Merger Agreement. Completion of the Merger is subject to customary closing conditions, including, among others, (1) the approval of the Merger Agreement by a majority of the votes cast by Bard’s shareholders at a special meeting held to vote on the Merger Agreement, among other items, (2) declaration of the effectiveness by the U.S. Securities and Exchange Commission (the “SEC”) of the Registration Statement on Form S-4 to be filed with the SEC by BD in connection with the shares of the stock of BD to be issued in the Merger, (3) approval for listing on the New York Stock Exchange of the stock of BD to be issued in the Merger, (4) obtaining antitrust approvals in the United States and certain other jurisdictions, (5) subject to certain exceptions, the accuracy of the representations and warranties of the other party and (6) material compliance by the other party with its obligations under the Merger Agreement. The transaction is expected to close in the fourth quarter of 2017. If the Merger Agreement is terminated, Bard may be required to pay BD an amount equal to fifty percent of BD’s out-of-pocket expenses incurred in connection with the Merger Agreement and the Merger and in certain other circumstances, Bard may be required to pay BD a termination fee of $750 million. The foregoing description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement attached as Exhibit 2.1 to the Form 8-K filed on April 24, 2017.

Results of Operations

Net Sales

Bard’s consolidated net sales for the quarter ended March 31, 2017 increased 7% on a reported basis (8% on a constant currency basis) compared to the same period in the prior year. Net sales “on a constant currency basis” is a non-GAAP measure and should not be viewed as a replacement of GAAP results. See “Management’s Use of Non-GAAP Measures” below. Price changes had the effect of decreasing consolidated net sales for the quarter ended March 31, 2017 by approximately 30 basis points as compared to the same period in the prior year. Exchange rate fluctuations had the effect of decreasing consolidated net sales for the quarter ended March 31, 2017 by approximately one percentage point, as compared to the same period in the prior year. The primary exchange rate movements that impacted net sales were the movement of the British Pound, Chinese Renminbi and the Euro compared to the U.S. dollar. The

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impact of exchange rate fluctuations on net sales is not indicative of the impact on net earnings due to the offsetting impact of exchange rate movements on operating costs and expenses, costs incurred in other currencies and the company’s hedging activities.

Bard’s United States net sales of $657.2 million for the quarter ended March 31, 2017 increased 5% compared to $625.4 million in the prior year quarter. International net sales of $281.6 million for the quarter ended March 31, 2017 increased 14% on a reported basis (17% on a constant currency basis) compared to $248.1 million in the prior year quarter.

A summary of net sales by product group category is as follows:

Product Group Summary of Net Sales

	Three Months Ended March 31,
	2017		2016		Change			Constant Currency
(dollars in millions)
Vascular	$	256.6	$	239.5		7	%		8	%
Urology		237.7		216.7		10	%		11	%
Oncology		255.5		241.9		6	%		6	%
Surgical Specialties		165.1		151.4		9	%		9	%
Other		23.9		24.0		—			2	%
Total net sales	$	938.8	$	873.5		7	%		8	%

Vascular Products - Bard markets a wide range of products for the peripheral vascular market, including endovascular products and vascular graft products. Also included within vascular products are royalty payments from W. L. Gore & Associates, Inc. (“Gore”), which will end in 2019. Consolidated net sales of vascular products for the quarter ended March 31, 2017 increased 7% on a reported basis (8% on a constant currency basis) compared to the prior year quarter. This increase was primarily due to growth in sales of endovascular products. United States net sales of vascular products for the quarter ended March 31, 2017 increased 5% compared to the prior year quarter. International net sales of vascular products for the quarter ended March 31, 2017 increased 11% on a reported basis (14% on a constant currency basis) compared to the prior year quarter.

Consolidated net sales of endovascular products for the quarter ended March 31, 2017 increased 8% on a reported basis (9% on a constant currency basis) compared to the prior year quarter. Net sales in this product line for the quarter ended March 31, 2017 were favorably impacted by growth in sales of percutaneous transluminal angioplasty (“PTA”) balloon catheters, including drug-coated PTA balloon catheters, stents and biopsy products.

Consolidated net sales of vascular graft products for the quarter ended March 31, 2017 decreased 4% on a reported basis (3% on a constant currency basis) compared to the prior year quarter.

Urology Products - Bard markets a wide range of products for the urology market, including basic urology drainage products, fecal and urinary continence products and urological specialty products. Bard also markets StatLock^® catheter stabilization products, which are used to secure many types of catheters sold by Bard and other companies, as well as Targeted Temperature Management™ products, which are used for therapeutic hypothermia. Consolidated net sales of urology products for the quarter ended March 31, 2017 increased 10% on a reported basis (11% on a constant currency basis) compared to the prior year quarter. This increase includes 6 percentage points of growth on both a reported basis and constant currency basis from the impact of selling inventory acquired in the Medicon, Inc. (“Medicon”) acquisition during the quarter ended March 31, 2016, which was recorded as sales into the joint venture prior to the acquisition. Net sales for the quarter ended March 31, 2017 were also favorably impacted by growth in sales of basic drainage products, urological specialty products and StatLock^® catheter stabilization products. These increases were partially offset by a decline in continence products. United States net sales of urology products for the quarter ended March 31, 2017 increased 6% compared to the prior year quarter. International net sales of urology products for the quarter ended March 31, 2017 increased 21% on a reported basis (26% on a constant currency basis) compared to the prior year quarter.

Consolidated net sales of basic drainage products for the quarter ended March 31, 2017 increased 16% on a reported basis (17% on a constant currency basis) compared to the prior year quarter. The increase for the quarter ended March 31, 2017 was primarily due to sales as a result of the Medicon acquisition.

Consolidated net sales of urological specialty products for the quarter ended March 31, 2017 increased 5% on a reported basis (6% on a constant currency basis) compared to the prior year quarter.

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Consolidated net sales of continence products for the quarter ended March 31, 2017 decreased 6% on a reported basis (3% on a constant currency basis) compared to the prior year quarter. This decrease was primarily due to a decline in sales of surgical continence products, a trend that is expected to continue.

Consolidated net sales of the StatLock^® catheter stabilization product line for the quarter ended March 31, 2017 increased 5% on both a reported basis and constant currency basis compared to the prior year quarter.

Oncology Products - Bard’s oncology business includes specialty vascular access products and enteral feeding devices. Specialty vascular access products include peripherally inserted central catheters (“PICCs”) used for intermediate to long-term central venous access, specialty access ports and accessories (“Ports”) used most commonly for chemotherapy, dialysis access catheters and vascular access ultrasound devices, which help facilitate the placement of PICCs. Consolidated net sales of oncology products for the quarter ended March 31, 2017 increased 6% on both a reported basis and constant currency basis compared to the prior year quarter. This increase was primarily due to growth in sales of PICCs. United States net sales of oncology products for the quarter ended March 31, 2017 increased 5% compared to the prior year quarter. International net sales of oncology products for the quarter ended March 31, 2017 increased 8% on a reported basis (10% on a constant currency basis) compared to the prior year quarter.

Consolidated net sales of PICCs for the quarter ended March 31, 2017 increased 8% on a reported basis (9% on a constant currency basis) compared to the prior year quarter.

Consolidated net sales of Ports for the quarter ended March 31, 2017 increased 3% on both a reported basis and constant currency basis compared to the prior year quarter.

Consolidated net sales of dialysis access catheters for the quarter ended March 31, 2017 increased 7% on both a reported basis and constant currency basis compared to the prior year quarter. Consolidated net sales of vascular access ultrasound devices for the quarter ended March 31, 2017 decreased 6% on both a reported basis and constant currency basis compared to the prior year quarter.

Surgical Specialty Products - Surgical specialty products include soft tissue repair products, performance irrigation devices and biosurgery products, including hemostats and sealants. Consolidated net sales of surgical specialty products for the quarter ended March 31, 2017 increased 9% on both a reported basis and constant currency basis compared to the prior year quarter. This increase was primarily due to growth in sales of synthetic hernia repair products and was partially offset by declines in sales of natural hernia repair products. United States net sales of surgical specialty products for the quarter ended March 31, 2017 increased 5% compared to the prior year quarter. International net sales of surgical specialty products for the quarter ended March 31, 2017 increased 22% on a reported basis (25% on a constant currency basis) compared to the prior year quarter. International net sales for the quarter ended March 31, 2017 reflected increases in biosurgery products and synthetic hernia repair products.

The soft tissue repair product line includes synthetic and natural tissue hernia repair implants, natural tissue breast reconstruction implants and hernia fixation products. Consolidated net sales of soft tissue repair products for the quarter ended March 31, 2017 increased 11% on both a reported basis and constant currency basis compared to the prior year quarter. Net sales in this product line were favorably impacted by growth in sales of synthetic hernia repair products and hernia fixation products and were partially offset by declines in sales of natural tissue hernia repair products, a trend that may continue.

Consolidated net sales of biosurgery products for the quarter ended March 31, 2017 increased 3% on both a reported basis and constant currency basis compared to the prior year quarter. Net sales in the product line were favorably impacted by growth in sales of hemostats. This increase was partially offset by a decline in surgical sealants due to a supply issue that is expected to be resolved in 2017.

Other Products - The other product group includes irrigation, wound drainage and certain original equipment manufacturers’ products.

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Costs and Expenses

A summary of costs and expenses as a percentage of net sales is as follows:

	Three Months Ended March 31,
	2017			2016(A)
Cost of goods sold		37.7	%		36.7	%
Marketing, selling and administrative expense		30.4	%		31.0	%
Research and development expense		7.5	%		7.8	%
Interest expense		1.6	%		1.3	%
Other (income) expense, net		1.3	%		6.9	%
Total costs and expenses		78.5	%		83.6	%

^(A)  Amounts do not add due to rounding.

Cost of goods sold - Cost of goods sold consists principally of the manufacturing and distribution costs of the company’s products. The category also includes royalties paid by the company, amortization of intangible assets and the impact of certain hedging activities. Cost of goods sold as a percentage of net sales for the quarter ended March 31, 2017 increased 100 basis points compared to the prior year quarter. The prior year quarter included the recognition of previously deferred profit on product shipments to the Medicon joint venture prior to its acquisition and the reversal of liabilities with respect to certain revenue-based and manufacturing-related milestones.

Marketing, selling and administrative expense - Marketing, selling and administrative expense consists principally of the costs associated with the company’s sales and administrative organizations. These costs as a percentage of net sales for the quarter ended March 31, 2017 decreased 60 basis points compared to the prior year quarter.

Research and development expense - Research and development expense consists principally of costs related to internal research and development activities, third-party research and development activities, and acquired in-process R&D (“IPR&D”) arising from the company’s business development activities. IPR&D costs may impact the comparability of the company’s results of operations between periods. Research and development expense for the quarter ended March 31, 2017 was $70.0 million, an increase of approximately 2% compared to the prior year quarter.

Interest expense - Interest expense was $15.1 million and $11.3 million for the quarters ended March 31, 2017 and 2016, respectively. The increase in interest expense for the quarter ended March 31, 2017 is primarily due to the May 2016 issuance of fixed-rate notes and the impact from the amortization of the related forward-starting interest rate swap.

Other (income) expense, net - The components of other (income) expense, net, are as follows:

	Three Months Ended March 31,
	2017			2016
(dollars in millions)
Interest income	$	(0.7	)	$	(0.3	)
Foreign exchange gains		(1.6	)		(1.9	)
Litigation charges		12.2			48.9
Restructuring and productivity initiative costs		2.7			9.8
Acquisition-related items		0.2			3.7
Other, net		(0.2	)		(0.2	)
Total other (income) expense, net	$	12.6		$	60.0

Litigation charges, net – For the quarter ended March 31, 2017, the amount reflects a charge for Civil Investigative Demands received from a number of State Attorneys General and litigation-related defense costs of $4.7 million in connection with the United States District Court for the Southern District of West Virginia’s pre-trial order to prepare 540 individual cases for trial. For the quarter ended March 31, 2016, the amount reflects the estimated costs for product liability matters. See Note 7 of the notes to condensed consolidated financial statements.

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Restructuring and productivity initiative costs – For the quarters ended March 31, 2017 and 2016, the amounts primarily reflect costs incurred in connection with productivity initiatives to optimize and streamline certain manufacturing and administrative functions to better align resources to the company’s business strategies. Key activities under these initiatives may include systems enhancements, the implementation of shared services centers designed to standardize and centralize processes or the outsourcing of certain services. Productivity initiative costs include consulting costs, primarily related to program creation and management, employee separation costs under the company’s existing severance program, and other related costs.

Acquisition-related items – For the quarter ended March 31, 2017, the amount primarily consists of purchase accounting adjustments. For the quarter ended March 31, 2016, the amount primarily consists of acquisition-related integration costs.

Income Tax Provision

The effective tax rate for the quarter ended March 31, 2017 was 11.6%. As discussed in Note 1 of the notes to condensed consolidated financial statements, the company adopted an accounting standard update that resulted in the recognition of excess tax benefits to the income tax provision upon settlement of share-based compensation awards. As a result, the effective tax rate for the quarter ended March 31, 2017 reflected a benefit of $27.0 million partially offset by the discrete tax effects of litigation charges.

The effective tax rate for the quarter ended March 31, 2016 was 18.7% which reflected the discrete tax effects of litigation charges related to product liability claims, which were incurred in a high tax jurisdiction. See Note 7 of the notes to condensed consolidated financial statements.

Net Income and Earnings Per Share Available to Common Shareholders

The company reported net income and diluted earnings per share available to common shareholders for the quarter ended March 31, 2017 of $178.1 million and $2.37, respectively. Net income and diluted earnings per share available to common shareholders for the prior year quarter were $116.2 million and $1.54, respectively. The current year quarter reflects amortization of intangible assets of $21.2 million, or $0.28 per diluted share, litigation charges of $12.1 million, or $0.16 per diluted share, charges from acquisition-related items (primarily consisting of transaction costs and integration costs) of $2.6 million, or $0.03 per diluted share, and restructuring and productivity initiative costs of $1.4 million, or $0.02 per diluted share. The prior year quarter reflects litigation charges of $30.8 million, or $0.41 per diluted share, amortization of intangible assets of $21.4 million, or $0.28 per diluted share, restructuring and productivity initiative costs of $6.6 million, or $0.09 per diluted share, and net charges from acquisition-related items (primarily consisting of integration costs and purchase accounting adjustments) of $2.0 million, or $0.03 per diluted share.

Liquidity and Capital Resources

The company assesses its liquidity in terms of its ability to generate cash to fund its operating, investing and financing activities. Significant factors affecting the management of liquidity are cash flows generated from operating activities, capital expenditures, acquisitions of businesses and technologies, cash dividends and common stock repurchases. Cash provided from operations continues to be a primary source of funds. The company believes that it could borrow adequate funds at competitive terms should it be necessary. The company also believes that its overall financial strength gives it sufficient financial flexibility. A summary of certain liquidity measures for the company as of March 31, is as follows:

	2017		2016
(dollars in millions)
Working capital	$	741.1	$	681.3
Current ratio		1.48/1		1.49/1

Cash and cash equivalents held by the company’s foreign subsidiaries were $888.0 million and $806.0 million at March 31, 2017 and December 31, 2016, respectively. It is the company’s intention to permanently reinvest the majority of these funds outside the United States to finance foreign operations, and the company’s plans do not demonstrate a need to repatriate these funds. If these funds are needed for U.S. operations for currently unforeseen circumstances or can no longer be permanently reinvested outside the United States, the company would be required to accrue and pay U.S. taxes on the earnings associated with these funds. In the United States, ongoing operating cash flows and available borrowings under the company’s committed syndicated bank credit facility provide it with sufficient liquidity.

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For the three months ended March 31, 2017 and 2016, net cash provided by operating activities was $140.6 million and $67.2 million, respectively. The increase in net cash provided by operating activities is primarily due to a settlement payment pursuant to an agreement with Medtronic plc in the prior year period (see Note 7 of the notes to condensed consolidated financial statements). This increase was partially offset by higher payments to claimants for certain product liability matters in the current year period.

For the three months ended March 31, 2017 and 2016, net cash used by investing activities was $28.3 million and $223.5 million, respectively. Capital expenditures were approximately $22.7 million and $20.5 million for the three months ended March 31, 2017 and 2016, respectively. The company spent $5.6 million and $203.0 million for the acquisition of businesses, products and technology to augment existing product lines for the three months ended March 31, 2017 and 2016, respectively.

For the three months ended March 31, 2017, net cash used for financing activities was $150.8 million compared to the $102.6 million provided by financing activities for the three months ended March 31, 2016. Total debt was $1.8 billion (including current maturities of $499.3 million) and $1.6 billion at March 31, 2017 and December 31, 2016, respectively. Total debt to total capitalization was 51.2% and 49.5% at March 31, 2017 and December 31, 2016, respectively. The three months ended March 31, 2016 reflects the redemption of $250 million of fixed-rate debt. Net cash used in financing activities also reflects $232.3 million used to repurchase 1,000,000 shares of common stock in the three months ended March 31, 2017 compared to $167.4 million to repurchase 897,004 shares of common stock in the prior year period. The company paid cash dividends of $0.26 per share and $0.24 per share for the three months ended March 31, 2017 and 2016, respectively.

The company maintains a $1.0 billion five-year committed syndicated bank credit facility that expires in November 2021. The credit facility supports the company’s commercial paper program and can be used for general corporate purposes. The facility includes pricing based on the company’s long-term credit ratings and includes a financial covenant that limits the amount of total debt to total capitalization. At March 31, 2017, the company was in compliance with this covenant. The company had commercial paper borrowings outstanding of $110.0 million at March 31, 2017. There were no commercial paper borrowings outstanding at December 31, 2016.

Contingencies

In the ordinary course of business, the company is subject to various legal proceedings and claims, including product liability matters, environmental matters, employment disputes, contractual disputes on agreements and other commercial disputes. In addition, the company operates in an industry susceptible to significant patent legal claims. At any given time in the ordinary course of business, the company is involved as either a plaintiff or defendant in a number of patent infringement actions. See Note 7 of the notes to condensed consolidated financial statements.

Certain Regulatory Matters

In the second quarter of 2016, the United States Food and Drug Administration (“FDA”) conducted an inspection at another of the company’s facilities after which the FDA issued a Form-483 to the company in connection with this inspection. The company responded to the FDA, is in the process of addressing the observations in the Form-483, and intends to fully implement corrective and preventive actions to address the FDA’s concerns. However, the company cannot give any assurances that the FDA will be satisfied with its response to the Form-483 or to the expected date of resolution of matters included in the Form-483. Although the company cannot give any assurances that the resolution of this matter will not have a material adverse effect on the company’s business, results of operations, financial conditions and/or liquidity, the company does not at this time believe this will have a material impact on its financial statements.

Management’s Use of Non-GAAP Measures

Net sales “on a constant currency basis” is a non-GAAP measure. The company analyzes net sales on a constant currency basis to better measure the comparability of results between periods. Because changes in foreign currency exchange rates have a non-operating impact on net sales, the company believes that evaluating growth in net sales on a constant currency basis provides an additional and meaningful assessment of net sales to both management and the company’s investors. Constant currency growth rates are calculated by translating the prior year’s local currency sales by the current period’s exchange rate. Constant currency growth rates are not indicative of changes in corresponding cash flows. The limitation of these non-GAAP measures is that they do not reflect results on a standardized reporting basis. Non-GAAP measures are intended to supplement the applicable GAAP disclosures and should not be viewed as replacements of GAAP results.

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Critical Accounting Policies

The preparation of financial statements requires the company’s management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Critical accounting policies are those that require application of management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Such policies are summarized in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section in Bard’s 2016 Annual Report on Form 10-K. There have been no significant changes to the company’s critical accounting policies since December 31, 2016.

Risks and Uncertainties; Cautionary Statement Regarding Forward-Looking Information

Certain statements contained herein or in other company documents and certain statements that may be made by management of the company orally may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “forecast,” “plan,” “believe” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. In particular, these include statements relating to product approvals, future performance of current and anticipated products, sales efforts, expenses, the outcome of contingencies, such as legal proceedings, and financial results. The company’s forward-looking statements speak only as of the date of this report or as of the date they are made, and the company undertakes no obligation to update its forward-looking statements.

In addition, there are substantial risks inherent in the medical device business. The company’s business involves the design, development, manufacture, packaging, distribution and sale of life-sustaining medical devices. These devices are often used on, or permanently or temporarily implanted in, patients in clinically demanding circumstances, such as operating rooms, emergency units, intensive care and critical care settings, among others. These circumstances, among other factors, can cause the products to become associated with adverse clinical events, including patient mortality and injury, and could lead to product liability claims (including lawsuits seeking class action status or seeking to establish multi-district litigation proceedings) and other litigation, product withdrawals, warning letters, recalls, field corrections or regulatory investigations or enforcement actions relating to one or more of the company’s products, any of which could have a material adverse effect on our business, results of operations, financial condition and/or liquidity. For further discussion of risks applicable to our business, see “Risk Factors” in Bard’s 2016 Annual Report on Form 10-K.

Because actual results are affected by these and other risks and uncertainties, the company cautions investors that actual results may differ materially from those expressed or implied. It is not possible to predict or identify all risks and uncertainties, but the most significant factors, in addition to those addressed above and those described under Item 1A. “Risk Factors” in Bard’s 2016 Annual Report on Form 10-K, that could adversely affect our business or cause the actual results to differ materially from those expressed or implied include, but are not limited to:

Effective management of and reaction to risks involved in our business, including:

• the ability to achieve manufacturing or administrative efficiencies, including gross margin benefits from our manufacturing processes and supply chain programs or in connection with the integration of acquired businesses;

• the effects of negative publicity and/or adverse media coverage concerning our products, competitors’ products, the geographic or product markets in which we compete or our industry in general, which could result in product withdrawals, decreased product demand or adverse reputational effects and which could reduce market or governmental acceptance of our products;

• the ability to identify appropriate companies, businesses and technologies as potential acquisition candidates, to consummate and successfully integrate such transactions or to obtain agreements for such transactions on favorable terms;

• the reduction in the number of procedures using our devices caused by customers’ cost-containment pressures or preferences for alternate therapies;

• the ability to implement, and realize the benefits of, our prior and planned investments in our business, including research and development expenditures focused on new market categories, and our plan to grow in emerging and/or faster-growing markets outside the United States and acquire growth platforms designed to change the mix of our portfolio towards faster, sustainable long-term growth;

• the uncertainty of whether research and development expenditures and sales force expansion will result in increased sales;

• the ability to reduce exposure and uncertainty related to tax audits, appeals and litigation;

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• the risk that the company may not successfully implement its expansion of its Enterprise Resource Planning (“ERP”) information system and other productivity initiatives, including ongoing efforts to outsource certain information technology system functions and services;

• internal factors, such as retention of key employees, including sales force employees;

• the ability to achieve earnings forecasts, which are generated based, among other things, on projected volumes and sales of many product types, some of which are more profitable than others, and projected royalty revenue from Gore;

• changes in factors and assumptions or actual results that differ from our assumptions on stock valuation and employee stock option exercise patterns, which could cause compensation and tax expense recorded in future periods to differ significantly from the compensation expense recorded in the current period;

• changes in factors and assumptions could cause pension cost recorded in future periods to differ from the pension cost recorded in the current period;

• the effect of market fluctuations on the value of assets in the company’s pension plans and the possibility that the company may need to make additional contributions to the plans as a result of any decline in the fair value of such assets;

• damage to a facility where our products are manufactured or from which they are distributed, which could render the company unable to manufacture or distribute one or more products and may require the company to reduce the output of products at the damaged facility thereby making it difficult to meet product shipping targets;

• the potential impairment of goodwill and intangible assets of the company resulting from insufficient cash flow generated from such assets specifically, or our business more broadly, so as to not allow the company to justify the carrying value of the assets;

• the ability to obtain appropriate levels of insurance on reasonable terms, or at all;

• the ability to recover for claims made to our insurance companies or under indemnification obligations to the company and that any amounts recovered under these arrangements may not be adequate to cover the company’s damages and/or costs; and

• the ability to realize the anticipated benefits of our restructuring activities and productivity initiatives to improve the company’s overall cost structure and improve efficiency.

Competitive factors, including:

• the trend of consolidation in the medical device industry as well as among our customers, resulting in potentially greater pricing pressures, competition and more significant and complex contracts than in the past, both in the United States and abroad;

• development of new products or technologies by competitors having superior performance or economic benefit compared to our current products or products under development which could negatively impact sales of our products or render one or more of our products obsolete;

• technological advances, patents and registrations obtained by competitors that would have the effect of excluding the company from new market segments or preventing the company from selling a product or including key features in the company’s products;

• attempts by competitors to gain market share through aggressive marketing programs; and

• reprocessing by third-party reprocessors of our products designed and labeled for single use.

Difficulties and delays inherent in the development, manufacturing, marketing and sale of medical products, including:

• the ability to complete planned and/or ongoing clinical trials successfully, to develop and obtain regulatory approval for products on a timely basis and to launch products on a timely basis within cost estimates;

• lengthy and costly regulatory approval processes, which may result in lost market opportunities and/or delayed product launches;

• delays or denials of, or grants of low or reduced levels of reimbursement for, procedures using newly developed products;

• the suspension or revocation of authority to manufacture, market or distribute existing products;

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• the imposition of additional or different regulatory requirements, such as those affecting manufacturing and labeling;

• performance, efficacy, quality or safety concerns for existing products, whether scientifically justified or not, that may lead to product discontinuations, product withdrawals, recalls, field corrections, regulatory investigations or enforcement actions, litigation or declining sales, including adverse events and/or concerns relating to the company’s vena cava filters, pelvic floor repair products and hernia repair products;

• FDA inspections resulting in Form-483 notices and/or warning letters identifying deficiencies in the company’s manufacturing practices and/or quality systems; warning letters identifying violations of FDA regulations that could result in product holds, recalls, restrictions on future clearances by the FDA and/or civil penalties; uncertainty regarding the expected date of resolution of any of these matters;

• the failure to obtain, limitations on the use of, or the loss of, patent and other intellectual property rights, and the failure of efforts to protect our intellectual property rights against infringement and legal challenges that can increase our costs;

• difficulties obtaining necessary components or raw materials used in the company’s products and/or price increases from the company’s suppliers of critical components or raw materials, including oil-based resins, or other interruptions of the supply chain; and

• customers that may limit the number of manufacturers or vendors from which they will purchase products, which can result in the company’s inability to sell products to or contract with large hospital systems, integrated delivery networks or group purchasing organizations.

Governmental action, including:

• the impact of continued healthcare cost containment;

• new laws and judicial decisions related to healthcare availability, healthcare reform, payment for healthcare products and services or the marketing and distribution of products, including legislative or administrative reforms to the United States Medicare and Medicaid systems or other United States or international reimbursement systems in a manner that would significantly reduce or eliminate reimbursements for procedures that use the company’s products;

• changes in the FDA and/or foreign regulatory approval processes that may delay or prevent the approval of new products and result in lost market opportunity;

• the impact of compliance, investigation and enforcement activities affecting the healthcare industry in general or the company in particular (including sales and marketing practices);

• changes in tax laws and long-standing tax principles affecting our business, such as the potential for comprehensive tax reform in the United States, the potential for the imposition of taxes, or increased tariffs, on goods produced outside of the United States and imported to the United States, and the impact within multiple jurisdictions resulting from the adoption of Organisation for Economic Co-operation and Development (OECD) policies through its base erosion and profit shifting project;

• changes in environmental laws or standards affecting our business including, among others, compliance with new labeling standards related to ozone-depleting substances;

• changes in laws that could require facility upgrades or process changes and could affect production rates and output; and

• compliance costs and potential penalties and remediation obligations in connection with environmental laws, including regulations regarding air emissions, waste water discharges and solid waste.

Legal disputes, including:

• disputes over legal proceedings, the outcome and the timing of final resolution of the suit filed by Gore against the company;

• product liability claims, which may involve lawsuits seeking class action status or seeking to establish multi-district litigation proceedings, including the Hernia Product Claims, the Women’s Health Product Claims and the Filter Product Claims;

• claims asserting securities law violations;

• claims asserting, and/or subpoenas seeking information regarding, violations of law in connection with federal and/or state healthcare programs such as Medicare or Medicaid;

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• derivative shareholder actions;

• claims and subpoenas asserting antitrust violations;

• environmental claims, including risks relating to accidental contamination or injury from the use of hazardous materials in the company’s manufacturing, sterilization and research activities and the potential for the company to be held liable for any resulting damages; and

• commercial disputes, including disputes over distribution agreements, license agreements, manufacturing/supply agreements, development/research agreements (including indemnification provisions), acquisition or sale agreements, and insurance policies.

General economic conditions, including:

• international and domestic business conditions;

• political or economic instability in foreign countries;

• interest rates;

• foreign currency exchange rates;

• changes in the rate of inflation;

• instability of global financial markets and economies such as have impacted Greece, Italy, Spain, Portugal, Puerto Rico and certain other countries or places where we operate or do business; and

• The negotiated terms of the United Kingdom’s departure from the European Union.

Other factors beyond our control, including catastrophes, both natural and man-made, earthquakes, floods, fires, explosions, strikes, work stoppages or slowdowns, cyberattacks, acts of terrorism or war.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The quantitative and qualitative disclosures about market risk are discussed in “Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk” in Bard’s 2016 Annual Report on Form 10-K. There have been no material changes in the information reported since the year ended December 31, 2016.

Item 4. Controls and Procedures

The company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the company’s reports under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosures. Any controls and procedures, no matter how well defined and operated, can provide only reasonable assurance of achieving the desired control objectives.

The company’s management, with the participation of the company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of the company’s disclosure controls and procedures as of March 31, 2017. Based upon that evaluation, the company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2017, the design and operation of the company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective to accomplish their objectives at the reasonable assurance level. There have been no changes in the company’s internal control over financial reporting that occurred during the quarter ended March 31, 2017 that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

In the ordinary course of business, the company is subject to various legal proceedings, investigations and claims, including, for example, environmental matters, employment disputes, disputes on agreements and other commercial disputes. In addition, the company operates in an industry susceptible to significant product liability and patent legal claims. At any given time, in the ordinary course of business, the company is involved as either a plaintiff or defendant in a number of patent infringement actions. If a third party’s patent infringement claim were to be determined against the company, the company might be required to make significant royalty or other payments or might be subject to an injunction or other limitation on its ability to manufacture or distribute one or more products. If a patent owned by or licensed to the company is found to be invalid or unenforceable, the company might be required to reduce the value of certain intangible assets on the company’s balance sheet and to record a corresponding charge, which could be significant in amount. Many of the company’s legal proceedings and claims could have a material adverse effect on its business, results of operations, financial condition and/or liquidity.

Product Liability Matters

Hernia Product Claims

As of March 31, 2017, approximately 25 federal and 80 state lawsuits involving individual claims by approximately 105 plaintiffs, as well as one putative class action in the United States, are currently pending against the company with respect to its Composix^® Kugel^® and certain other hernia repair implant products (collectively, the “Hernia Product Claims”). The company voluntarily recalled certain sizes and lots of the Composix^® Kugel^® products beginning in December 2005. In June 2007, the Composix^® Kugel^® lawsuits and, subsequently, other hernia repair product lawsuits, pending in federal courts nationwide were transferred into one Multidistrict Litigation (“MDL”) for coordinated pre-trial proceedings in the United States District Court for the District of Rhode Island. The MDL stopped accepting new cases in the second quarter of 2014 and was terminated in November 2016, at which time the remaining federal lawsuits were remanded to their courts of original jurisdiction for trial. As of March 31, 2017, all but one of the putative class actions pending against the company was dismissed. The remaining putative class action pending against the company has not been certified and seeks: (i) medical monitoring; (ii) compensatory damages; (iii) punitive damages; (iv) a judicial finding of defect and causation; and/or (v) attorneys’ fees. In April 2014, a settlement was reached with respect to the three putative Canadian class actions within amounts previously recorded by the company. Approximately 70 of the state lawsuits, involving individual claims by approximately 70 plaintiffs, are pending in the Superior Court of the State of Rhode Island, with the remainder in various other jurisdictions. The Hernia Product Claims also generally seek damages for personal injury resulting from use of the products.

The company has resolved the majority of its historical Hernia Product Claims, including through agreements or agreements in principle with various plaintiffs’ law firms to settle their respective inventories of cases. Each agreement involving the settlement of a firm’s inventory of claims was subject to certain conditions, including requirements for participation in the proposed settlements by a certain minimum number of plaintiffs. In addition, the company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Hernia Product Claims, and intends to vigorously defend Hernia Product Claims that do not settle, including through litigation. The company expects additional trials of Hernia Product Claims to take place over the next 12 months. The company cannot give any assurances that the resolution of the Hernia Product Claims that have not settled, including asserted and unasserted claims and the putative class action lawsuit, will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Women’s Health Product Claims

As of March 31, 2017, product liability lawsuits involving individual claims by approximately 5,305 plaintiffs are currently pending against the company in various federal and state jurisdictions alleging personal injuries associated with the use of certain of the company’s surgical continence products for women, which includes products manufactured by both the company and two subsidiaries of Medtronic plc (as successor in interest to Covidien plc) (“Medtronic”), each a supplier of the company. Medtronic has an obligation to defend and indemnify the company with respect to any product defect liability for products its subsidiaries had manufactured. As described below, in July 2015 the company reached an agreement with Medtronic regarding certain aspects of Medtronic’s indemnification obligation. In addition, five putative class actions in the United States and five putative class actions in Canada have been filed against the company, and a limited number of other claims have been filed or asserted in various non-U.S. jurisdictions. The foregoing lawsuits, unfiled or unknown claims, putative class actions and other claims, together with claims that have settled or are the subject of agreements or agreements in principle to settle, are referred to collectively as the “Women’s Health Product Claims”. The Women’s Health Product Claims generally seek damages for personal injury resulting from use of the products. The putative class actions, none of which has been certified, seek: (i) medical monitoring; (ii) compensatory damages; (iii) punitive damages; (iv) a judicial

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finding of defect and causation; and/or (v) attorneys’ fees. In April 2015, the Ontario Superior Court of Justice dismissed the plaintiffs’ motion for class certification in one Canadian putative class action. In March 2016, the company reached an agreement in principle to resolve all Canadian putative class actions, with the exception of a Quebec class action, within amounts previously recorded by the company, which settlement was finalized in September 2016. In January 2017, the court approved the discontinuance of the proposed Quebec class action.

In October 2010, the Women’s Health Product Claims involving solely Avaulta^® products pending in federal courts nationwide were transferred into an MDL in the United States District Court for the Southern District of West Virginia (the “WV District Court”), the scope of which was later expanded to include lawsuits involving all women’s surgical continence products that are manufactured or distributed by the company. The first trial in a state court was completed in California in July 2012 and resulted in a judgment against the company of approximately $3.6 million. On appeal the decision was affirmed by the appellate court in November 2014. The company filed a petition for review to the California Supreme Court on December 24, 2014, which was denied on February 18, 2015. The judgment in this matter, including interest and costs, was paid on March 20, 2015 within the amounts previously recorded by the company. The first trial in the MDL commenced in July 2013 and resulted in a judgment against the company of approximately $2 million, which was upheld by the Fourth Circuit on January 14, 2016. The company does not believe that any verdicts entered to date are representative of potential outcomes of all Women’s Health Product Claims. On January 16, 2014 and July 31, 2014, the WV District Court ordered that the company prepare 200 and then an additional 300 individual cases, respectively, for trial (the “2014 WHP Pre-Trial Orders”). The 2014 WHP Pre-Trial Orders resulted in significant additional litigation-related defense costs beginning in the second quarter of 2014 and continuing through the second quarter of 2015. In February 2015, the WV District Court appointed a Special Master to assist with settlement resolution. In June 2015, the WV District Court issued an order staying the requirement to prepare a significant portion of the cases covered by the 2014 WHP Pre-Trial Orders. Substantially all of the 500 individual cases that are the subject of the 2014 WHP Pre-Trial Orders have been part of agreements or agreements in principle to settle with various plaintiff law firms. In December 2016, the WV District Court lifted the stay of the 2014 WHP Pre-Trial Orders and remanded five of the unsettled cases to their courts of original jurisdiction for trial. In the first quarter of 2017, an additional 11 cases were remanded for trial for a total of 16 remanded cases. Five of those cases have been assigned trial dates between the third quarter of 2017 and the first quarter of 2018. In response to court orders on January 27, 2017 and March 3, 2017, the company is required to prepare an additional approximately 540 individual cases for trial (together with the 2014 WHP Pre-Trial Orders, the “WHP Pre-Trial Orders”). The WHP Pre-Trial Orders may result in material additional cost in future periods in defending Women’s Health Product Claims. The WV District Court may also order that the company prepare additional cases for trial, which could result in material additional costs in future periods.

As of March 31, 2017, the company reached agreements or agreements in principle with various plaintiffs’ law firms to settle their respective inventories of cases totaling approximately 11,005 Women’s Health Product Claims, including approximately: 560 during 2014, 6,215 during 2015, 4,155 during 2016 and approximately 75 during 2017. The company believes that these Women’s Health Product Claims are not the subject of Medtronic’s indemnification obligation. These settlement agreements and agreements in principle include unfiled and previously unknown claims held by various plaintiffs’ law firms, which have not been included in the approximate number of lawsuits set forth in the first paragraph of this section. Each agreement is subject to certain conditions, including requirements for participation in the proposed settlements by a certain minimum number of plaintiffs. The company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Women’s Health Product Claims, which may include additional inventory settlements. Notwithstanding these settlement efforts, the company anticipates additional trials over the next 12 months. In addition, one or more possible consolidated trials may occur in the future.

In July 2015, as part of the agreement noted above, Medtronic agreed to take responsibility for pursuing settlement of certain of the Women’s Health Product Claims that relate to products distributed by the company under supply agreements with Medtronic and the company has paid Medtronic $121 million towards these potential settlements. The company also may, in its sole discretion, transfer responsibility for settlement of additional Women’s Health Product Claims to Medtronic on similar terms. The agreement does not resolve the dispute between the company and Medtronic with respect to Women’s Health Product Claims that do not settle, if any. As part of the agreement, Medtronic and the company agreed to dismiss without prejudice their previously filed litigation with respect to Medtronic’s obligation to defend and indemnify the company.

The approximate number of lawsuits set forth in the first paragraph of this section does not include approximately 590 generic complaints involving women’s health products where the company cannot, based on the allegations in the complaints, determine whether any of those cases involve the company’s women’s health products. In addition, the approximate number of lawsuits set forth in the first paragraph of this section does not include approximately 865 claims that have been threatened against the company but for which complaints have not yet been filed. In addition, the company has limited information regarding the nature and quantity of these and other unfiled or unknown claims. During the course of engaging in settlement discussions with plaintiffs’ law firms, the company has learned, and may in future periods learn, additional information regarding these and other unfiled or unknown claims, or other lawsuits, which could materially impact

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the company’s estimate of the number of claims or lawsuits against the company. While the company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Women’s Health Product Claims and intends to vigorously defend the Women’s Health Product Claims that do not settle, including through litigation, it cannot give any assurances that the resolution of these claims will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Filter Product Claims

As of March 31, 2017, product liability lawsuits involving individual claims by approximately 1,755 plaintiffs are currently pending against the company in various federal and state jurisdictions alleging personal injuries associated with the use of the company’s vena cava filter products (all lawsuits, collectively, the “Filter Product Claims”). In August 2015, the Judicial Panel for Multi-District Litigation (“JPML”) ordered the creation of a Multi-District Litigation for all federal Filter Product Claims (the “IVC Filter MDL”) in the District of Arizona. There are approximately 1,705 Filter Product Claims that have been, or shortly will be, transferred to the IVC Filter MDL, including one medical monitoring class action. The remaining approximately 45 Filter Product Claims are pending in various state courts. In March 2016, a putative Canadian class action was filed against the company in Quebec. In April 2016 and May 2016, putative Canadian class actions were filed in Ontario and British Columbia, respectively. In November 2016, a putative Canadian class action was filed in Saskatchewan. The approximate number of lawsuits set forth above does not include approximately 25 claims that have been threatened against the company but for which complaints have not yet been filed. In addition, the company has limited information regarding the nature and quantity of these and other unfiled or unknown claims. The company continues to receive claims and lawsuits and may in future periods learn additional information regarding other unfiled or unknown claims, or other lawsuits, which could materially impact the company’s estimate of the number of claims or lawsuits against the company. The company expects that trials of Filter Product Claims may take place over the next 12 months. While the company intends to vigorously defend Filter Product Claims that do not settle, including through litigation, it cannot give any assurances that the resolution of these claims will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

General

In most product liability litigations (like those described above), plaintiffs allege a wide variety of claims, ranging from allegations of serious injury caused by the products to efforts to obtain compensation notwithstanding the absence of any injury. In many of these cases, the company has not yet received and reviewed complete information regarding the plaintiffs and their medical conditions and, consequently, is unable to fully evaluate the claims. The company expects that it will receive and review additional information regarding any remaining unsettled product liability matters.

The company believes that some settlements and judgments, as well as some legal defense costs, relating to product liability matters are or may be covered in whole or in part under its product liability insurance policies with a limited number of insurance carriers, or, in some circumstances, indemnification obligations to the company from other parties, which if disputed, the company intends to vigorously contest. Amounts recovered under the company’s product liability insurance policies or indemnification arrangements may be less than the stated coverage limits or less than otherwise expected and may not be adequate to cover damages and/or costs relating to claims. In addition, there is no guarantee that insurers or other parties will pay claims or that coverage or indemnity will be otherwise available.

In January 2017, the company reached an agreement to resolve litigation filed in the Southern District of New York by its insurance carriers in connection with Women’s Health Product Claims and Filter Product Claims. The agreement requires the insurance carriers to reimburse the company for certain future costs incurred in connection with Filter Product Claims up to an agreed amount. For certain product liability claims or lawsuits, the company does not maintain or has limited remaining insurance coverage.

Other Legal Matters

Since early 2013, the company has received subpoenas or Civil Investigative Demands from a number of State Attorneys General seeking information related to the sales and marketing of certain of the company’s products that are the subject of the Hernia Product Claims and the Women’s Health Product Claims. The company is cooperating with these requests. Although the company has had discussions with the State Attorneys General with respect to overall potential resolution of this matter, there can be no assurance that a resolution will be reached or what the terms of any such resolution may be. In the first quarter of 2017, the company recorded a charge to other (income) expense, net, of $7.5 million ($7.5 million after tax). Since it is not feasible to predict the outcome of these proceedings, the company cannot give any assurances that the resolution of these proceedings will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

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In November 2015, the Department of Defense Inspector General issued an investigative subpoena to the company. The Department of Health and Human Services is also participating in this investigation. The subpoena seeks documents related to the company’s sales and marketing of certain filter products, drug coated balloon catheters, and peripheral arterial disease detection products. The company is cooperating with these requests. Since it is not feasible to predict the outcome of these proceedings, the company cannot give any assurances that the resolution of these proceedings will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

In June 2011, W. L. Gore & Associates, Inc. (“Gore”) filed suit in the U.S. District Court in Delaware alleging the company had infringed several of Gore’s patents. The trial began March 1, 2017, and was phased such that liability issues would be heard and decided by the jury first, with damages and willfulness to be heard immediately thereafter, if necessary. The liability phase was completed on March 8, 2017 with the jury finding the asserted Gore patent not valid and not infringed. Gore has the option to appeal and/or request a new trial or that the jury’s verdict be set aside. It is unclear what options Gore may choose or the outcome of the matter. The company intends to vigorously defend the allegations asserted by Gore. The company cannot give any assurances that an adverse resolution of this matter will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

The company is subject to numerous federal, state, local and foreign environmental protection laws governing, among other things, the generation, storage, use and transportation of hazardous materials and emissions or discharges into the ground, air or water. The company is or may become a party to proceedings brought under various federal laws including the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), commonly known as Superfund, the Resource Conservation and Recovery Act, the Clean Water Act, the Clean Air Act and similar state or foreign laws. These proceedings seek to require the owners or operators of contaminated sites, transporters of hazardous materials to the sites and generators of hazardous materials disposed of at the sites to clean up the sites or to reimburse the government for cleanup costs. In most cases, there are other potentially responsible parties that may be liable for remediation costs. In these cases, the government alleges that the defendants are jointly and severally liable for the cleanup costs; however, these proceedings are frequently resolved so that the allocation of cleanup costs among the parties more closely reflects the relative contributions of the parties to the site contamination. The company’s potential liability varies greatly from site to site. For some sites, the potential liability is de minimis and for others the costs of cleanup have not yet been determined. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than completion of the remedial feasibility study and are adjusted as further information develops or circumstances change. Costs of future expenditures for environmental remediation obligations are not discounted to their present value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable. The company believes that the proceedings and claims described above will likely be resolved over an extended period of time. While it is not feasible to predict the outcome of these proceedings, based upon the company’s experience, current information and applicable law, the company does not expect these proceedings to have a material adverse effect on its financial condition and/or liquidity. However, one or more of the proceedings could be material to the company’s business and/or results of operations.

The company regularly monitors and evaluates the status of product liability and other legal matters, and may, from time-to-time, engage in settlement and mediation discussions taking into consideration developments in the matters and the risks and uncertainties surrounding litigation. These discussions could result in settlements of one or more of these claims at any time.

Item 1A. Risk Factors

There have been no material changes to the risk factors disclosed in Part I, Item 1A. in Bard’s 2016 Annual Report on Form 10-K other than the following additional risk factors:

There are risks and uncertainties associated with our merger with Becton, Dickinson and Company.

On April 23, 2017, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Becton, Dickinson and Company (“BD”) and Lambda Corp, a wholly owned subsidiary of BD (“Merger Corp”), pursuant to which we will merge with Merger Corp and become a wholly owned subsidiary of BD (the “Merger”). Completion of the Merger is subject to customary closing conditions, including, among others, (1) the approval of the Merger Agreement by a majority of the votes cast by our shareholders at a special meeting held to vote on the Merger Agreement, among other items, (2) declaration of the effectiveness by the SEC of the Registration Statement on Form S-4 to be filed with the SEC by BD in connection with the shares of the stock of BD to be issued in the Merger, (3) approval for listing on the New York Stock Exchange of the stock of BD to be issued in the Merger, (4) obtaining antitrust approvals in the United States and certain other jurisdictions, (5) subject to certain exceptions, the accuracy of the representations and warranties of the other party and (6) material compliance by the other party with its obligations under the Merger Agreement. There is no assurance that the conditions to the Merger will be satisfied in a timely manner or at all. There are numerous risks related to the Merger, including the following:

• Various conditions to the closing of the Merger may not be satisfied or waived;

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• Lawsuits may be filed against us challenging the Merger, and an adverse ruling may delay the Merger or prevent it from being completed;

• Required regulatory approvals from governmental entities may delay the Merger;

• Our ability to attract, recruit, retain and motivate current and prospective employees may be adversely affected;

• The attention of our employees and management may be diverted due to activities related to the Merger;

• Disruptions from the Merger, whether or not it is completed, may harm our relationships with our employees, customers, distributors, suppliers or other business partners, and may result in a loss of or a substantial decrease in purchases by our customers; and

• The Merger Agreement restricts us from engaging in certain actions without BD’s approval, which could prevent us from pursuing certain business opportunities outside the ordinary course of business that arise prior to the closing of the Merger.

In addition, we have incurred, and will continue to incur, significant costs, expenses and fees for professional services and other transaction costs in connection with the Merger, and these fees and costs are payable by us regardless of whether the Merger is consummated.

Failure to complete the proposed merger could adversely affect our business and the market price of our common stock.

There is no assurance that the closing of the Merger will occur, and we cannot predict with certainty whether and when the conditions to closing (described above) will be satisfied. In addition, the Merger Agreement may be terminated under certain specified circumstances. If the Merger Agreement is terminated, we may be required to pay BD an amount equal to fifty percent of BD’s out-of-pocket expenses incurred in connection with the Merger Agreement and the Merger and in certain other circumstances, we may be required to pay BD a termination fee of $750 million. If the Merger is not consummated, our stock price will likely decline as it has recently traded based on the proposed per share price for the Merger. We will have incurred significant costs, including, among other things, the diversion of management resources, for which we will have received little or no benefit if the closing of the Merger does not occur. A failed transaction may result in negative publicity and a negative impression of us in the investment community. The occurrence of any of these events individually or in combination could have a material adverse effect on our results of operations and the market price of our common stock.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information with respect to the shares of the company’s common stock repurchased during the quarter ended March 31, 2017:

	Issuer Purchases of Equity Securities
Period	Total Number of Shares Purchased(1)		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs(2)		Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under Plans or Programs(2)
January 1 – January 31, 2017		1,000,868	$	232.36		1,000,000	$	257,148,419
February 1 – February 28, 2017		165,865		239.45		—		257,148,419
March 1 – March 31, 2017		2,517		247.63		—		257,148,419
Total		1,169,250	$	233.40		1,000,000	$	257,148,419

(1) Includes 169,250 shares that the company repurchased during the three month period ended March 31, 2017 that were not part of the publicly announced share repurchase authorization. These shares were purchased from employees to satisfy tax withholding requirements on the vesting of restricted shares/units from equity-based awards.

(2) On June 8, 2016, the company announced that its Board of Directors had authorized the repurchase of up to an additional $500 million of common stock.

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Item 5. Other Information

The company’s policy governing transactions in its securities by the company’s directors, executive officers and other specified employees permits such persons to adopt trading plans pursuant to Rule 10b5-1 of the Exchange Act. From time-to-time, the company’s executive officers have established trading plans relating to the company’s common stock under Rule 10b5-1, and the company anticipates additional trading plans may be established in the future. The company currently discloses details regarding individual trading plans on its website.

Item 6. Exhibits

Number	Description
10.44*	Stock Equivalent Plan for Outside Directors of C. R. Bard, Inc. (as Amended and Restated), effective January 1, 2017**
10.45*	2005 Directors’ Stock Award Plan of C. R. Bard, Inc. (as Amended and Restated), effective December 11, 2013**
12.1	Computation of Ratio of Earnings to Fixed Charges**
31.1	Rule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer**
31.2	Rule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer**
32.1	Section 1350 Certification of Chief Executive Officer (furnished herewith)
32.2	Section 1350 Certification of Chief Financial Officer (furnished herewith)
101.INS	XBRL Instance Document**
101.SCH	XBRL Taxonomy Extension Schema Document**
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document**
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document**
101.LAB	XBRL Taxonomy Extension Label Linkbase Document**
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document**

* Each of these exhibits constitutes a management contract or a compensatory plan or arrangement.

** Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	C. R. BARD, INC.
		(Registrant)
Date: April 27, 2017
		/s/    CHRISTOPHER S. HOLLAND
		Christopher S. Holland Senior Vice President and Chief Financial Officer
		/s/    FRANK LUPISELLA JR.
		Frank Lupisella Jr. Vice President and Controller

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INDEX TO EXHIBITS

Number	Description
10.44	Stock Equivalent Plan for Outside Directors of C. R. Bard, Inc. (as Amended and Restated), effective January 1, 2017
10.45	2005 Directors’ Stock Award Plan of C. R. Bard, Inc. (as Amended and Restated), effective December 11, 2013
12.1	Computation of Ratio of Earnings to Fixed Charges
31.1	Rule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer
31.2	Rule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer
32.1	Section 1350 Certification of Chief Executive Officer (furnished herewith)
32.2	Section 1350 Certification of Chief Financial Officer (furnished herewith)
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

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EX-10.44

Exhibit 10.44

STOCK EQUIVALENT PLAN FOR OUTSIDE DIRECTORS OF C. R. BARD, INC. (AS

AMENDED AND RESTATED)

C. R. Bard, Inc. hereby amends and restates the Stock Equivalent Plan for Outside Directors of C. R. Bard, Inc. (the “Plan”). The Corporation’s objectives in maintaining the Plan are (a) providing a means of attracting and retaining Outside Directors whose abilities, experience and judgment can contribute to the Corporation’s continued progress and (b) retaining the Outside Director’s continuing counsel following retirement from the Board of Directors.

SECTION 1.    DEFINITIONS.

Except as otherwise specified, or as the context may otherwise require, the following terms have the meanings indicated below for all purposes of the Plan:

1.01    “Account” shall mean a book account maintained by the Committee to disclose the interest of each Participant under the Plan.

1.02     “Annual Unit Credit” shall be defined as in Section 3.01.

1.03    “Beneficiary” shall mean the person (or persons) who are designated by the Director to receive benefits payable upon the Director’s death under this Plan. Such designation shall be made by the Director on a form prescribed by the Corporation. The Director may at any time change or revoke such designation by written notice to the Corporation. If the Director has no living designated beneficiary on the date of Director’s death, then the benefits otherwise payable to the designated beneficiary under this Agreement shall be paid to the Director’s estate.

1.04    “Board of Directors” shall mean the Board of Directors of the Corporation.

1.05    “Cause” shall mean any act or omission (a) in breach of the Outside Director’s duty of loyalty to the Corporation or its Corporate Stockholders, (b) not in good faith or involving a knowing violation of law, or (c) resulting in receipt by the Outside Director of an improper personal benefit.

1.06    “Change of Control” shall mean a change of control of the nature that would be required to be reported on the Current Report on Form 8-K, pursuant to Section 13 or 15(d) of the Act (other than such a change of control involving a Permitted Holder); provided, that, without limitation, a Change of Control shall be deemed to have occurred if:

(a)    any “person” (other than a Permitted Holder) shall become the “beneficial owner”, as those terms are defined below, of capital stock of the Corporation, the voting power of which constitutes 20% or more of the general voting power of all of the Corporation’s outstanding capital stock; or

(b)    individuals who, as of April 21, 2005, constituted the Board (the “Incumbent Board”) cease for any reasons to constitute at least a majority of the Board; provided , that any person becoming a Director subsequent to April 21, 2005, whose election, or nomination for election by the Corporation’s shareholders, was approved by a vote of at least three quarters of the Directors comprising the Incumbent Board (other than an election or nomination of an individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the Directors of the Corporation, which is or would be subject to Rule 14a-11 of the Regulation 14A promulgated under the Act) shall be, for purposes of the Plan, considered as though such person were a member of the Incumbent Board.

For purposes of the definition of Change of Control, the following definitions shall be applicable:

(c)    The term “person” shall mean any individual, group, corporation or other entity.

(d)    For purposes of this definition only, any person shall be deemed to be the “beneficial owner” of any shares of capital stock of the Corporation:

(i) which that person owns directly, whether or not of record, or

(ii) which that person has the right to acquire pursuant to any agreement or understanding or upon exercise of conversion rights, warrants, or options, or otherwise, or

(iii) which are beneficially owned, directly or indirectly (including shares deemed owned through application of clause (ii) above), by an “affiliate” or “associate” (as defined in the rules of the Securities and Exchange Commission under the Securities Act of 1933, as amended) of that person, or

(iv) which are beneficially owned, directly or indirectly (including shares deemed owned through application of clause (ii) above), by any other person with which that person or such person’s “affiliate” or “associate” (defined as aforesaid) has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of capital stock of the Corporation.

(e)    The outstanding shares of capital stock of the Corporation shall include shares deemed owned through application of clauses (d)(ii), (iii) and (iv), above, but shall not include any other shares which may be issuable pursuant to any agreement or upon exercise of conversion rights, warrants or options, or otherwise, but which are not actually outstanding.

1.07    “Committee” shall mean the Governance Committee of the Board of Directors or such other committee as may be designated by the Board.

1.08    “Corporation Stock” shall mean the common stock, par value $.25 per share, of the Corporation.

1.09    “Effective Date” shall mean January 1, 2017.

1.10    “Fair Market Value” shall mean on a given date, (a) if there should be a public market for Corporation Stock on such date, the arithmetic mean of the high and low prices of Corporation Stock as reported on such date on the composite tape of the principal national securities exchange on which shares of Corporation Stock are listed or admitted to trading, or, if Corporation Stock is not listed or admitted on any national securities exchange, the arithmetic mean of the per share closing bid price and per share closing asked price of Corporation Stock on such date as quoted on the National Association of Securities Dealers Automated Quotation System (or such market in which such prices are regularly quoted) (the “NASDAQ”), or, if no sale of shares of Corporation Stock shall have been reported on the composite tape of any national securities exchange or quoted on the NASDAQ on such date, then the immediately preceding date on which sales of shares Corporation Stock have been so reported or quoted shall be used, and (b) if there should not be a public market for shares of Corporation Stock on such date, the Fair Market Value shall be the value established by the Committee in good faith.

1.11    “Outside Director” shall mean a member of the Board of Directors who is not also an employee of the Corporation.

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1.12    “Participant” shall mean an Outside Director who has fulfilled the eligibility requirements of Section 2 and whose distributable interest under the Plan has not been fully paid, forfeited or cancelled.

1.13    “Plan” shall mean the Stock Equivalent Plan for Outside Directors of C.R. Bard, Inc., as amended and restated.

1.14    “Pension Plan” shall mean the Employees’ Retirement Plan of C. R. Bard, Inc., as amended and restated.

1.15    “Service” shall mean the number of years that the Outside Director serves on the Board of Directors, commencing on the date of his or her election as an Outside Director and ending on the date of his or her termination as an Outside Director. With regard to an Outside Director who is a former Chief Executive Officer of the Corporation, “Service” means the number of years served as a member of the Board of Directors, commencing on the date of his election as a Director and ending on his termination as an Outside Director. For purposes of determining Service, a partial year shall be rounded up to a full year.

1.16    “Unit” shall mean an unfunded promise to pay an amount of cash equal to one share of Corporation Stock in accordance with the terms of this Plan.

SECTION 2.    ELIGIBILITY.

Each Outside Director who was a Participant on the Effective Date shall continue to be a Participant in the Plan. An individual who becomes an Outside Director after the Effective Date shall become a Participant on the date his or her Service as an Outside Director commences. Except as otherwise provided by the Committee, no Outside Director (other than a former Chief Executive Officer of the Corporation) shall be a Participant if such Outside Director is a participant or former participant under the Pension Plan.

SECTION 3.    GRANT OF UNITS.

3.01    Annual Unit Credits. Each year, effective on the date on which annual stock-based awards are granted pursuant to the 2005 Directors’ Stock Award Plan of C. R. Bard, Inc. (as Amended and Restated) or similar plan then in effect, the Committee shall grant each Participant a number of Units equal to (i) the target dollar amount recommended by the Committee and approved by the Board of Directors (“Annual Unit Credit”); and (ii) divided by the Fair Market Value of Corporation Stock on the date of grant of such Units; provided, however, that, notwithstanding any other provision hereof, in the event that the Board of Directors terminates the Plan effective as of a date other than a December 31 ^st, the grant of Units for the year of the Plan termination shall be prorated based on the portion of the calendar year that has elapsed through the effective date of the Plan termination.

3.02    Participant Accounts. The Committee shall maintain an Account for each Participant in which Units shall be entered when granted. The Committee shall furnish annually to each Participant a statement of his or her Account. A Participant shall not have any dividend or voting rights with respect to Units credited to his or her Account.

3.03    Grandfathered Benefits. Each Participant who participated in the Retirement Plan for Outside Directors of C. R. Bard, Inc. (the “Prior Plan”) on December 31, 1996 had additional amounts credited to his or her Account as elected, in writing by him or her prior to January 15, 1997.

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SECTION 4.    VESTING.

4.01    In General. A Participant shall be vested in the balance in his Account based on his or her Service at termination as an Outside Director according to the following schedule:

Service at Termination	Vested Percentage
Less than 5 years		0	%
5 years or more		100	%

Any balance in a Participant’s Account which is not vested on the date of his or her termination of Service shall be forfeited.

4.02    Acceleration of Vesting. Notwithstanding the foregoing provisions of this section, each Participant shall be 100% vested in the balance in his or her Account upon the effective date of a Change of Control.

SECTION 5.    AMOUNT AND FORM OF BENEFITS.

5.01    Determination of Distributable Interest. If a Participant elects to receive quarterly installment payments in accordance with Section 6 below, a Participant shall receive a quarterly installment benefit (commencing on the date, and for the period of time set forth in Section 6 below) in an amount equal to the number of vested Units in the Participant’s Account multiplied by the average closing price of the Corporation Stock as listed on the New York Stock Exchange during the six-month period immediately preceding his or her termination date and divided by four times the number of years of the Participant’s Service (each a “Quarterly Installment”). If a Participant does not elect to receive quarterly installments in accordance with Section 6 below, he or she shall receive an amount equal to the present value of all of the Quarterly Installments that he or she would have received had he or she elected quarterly installments, discounted using the 30-year treasury rate as in effect on the date of the Participant’s termination of service as a Director.

5.02    Form of Benefit. All payments under the Plan shall be made in cash.

SECTION 6.    TIME OF PAYMENTS.

6.01    Payment of Benefits. Unless a Participant elects quarterly installment payments pursuant to Section 6.02 or 6.03 below, payment of the Participant’s distributable interest shall be paid in a lump sum payment as of the first day of the calendar quarter next following the later of (a) the date the Participant terminates service as a Director or (b) the date the Participant attains age 55.

6.02    Deferred Payment of Benefits. A Participant may make an irrevocable election to receive distributions of the Participant’s interest under the Plan in equal quarterly installments for a period of years equal to the number of years of the Participant’s Service by filing an election with the Committee. If such election is made prior to the later of the 30^th day after the Participant commences participation in the Plan or January 1, 2006, such installment payments shall commence on the first day of the calendar quarter next following the later of (a) the date the Participant terminates service as a Director or (b) the date the Participant attains age 55.

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6.03    Subsequent Deferral Elections. If the election described in Section 6.02 is made after the date on which the grant is made, installment payments shall commence as of the first day of the calendar quarter next following the later of (a) five years after the Participant terminates Service or (b) the date the Participant attains age 60. A Participant’s subsequent election to receive benefits in quarterly installments must be made at least twelve months prior to the later of the Participant’s termination of Service or his reaching age 55 in order to be effective. An election by the Participant made within the twelve month period prior to the Participant’s termination of service shall be null and void and the Participant’s benefits under the Plan shall be distributed in a lump sum as described in Section 6.01.

SECTION 7.    INCREASES IN ANNUAL UNIT CREDIT.

If the Annual Unit Credit is increased to an amount higher than that in effect as of the date an Outside Director ceased his or her Service, the Committee may, in its sole discretion, prospectively increase the amount of benefits under the Plan to be paid, or then being paid, to a retired Outside Director to reflect the increase in the Annual Unit Credit.

SECTION 8.    LIMITATION ON ANNUAL UNIT CREDIT.

Notwithstanding any provision of this Plan to the contrary, the maximum aggregate Annual Unit Credit granted to a Participant during a calendar year shall not exceed $150,000.

SECTION 9.    DEATH BENEFITS.

9.01    Post-Termination. If a Participant dies on or after the date payment of the Participant’s distributable interest under the Plan is made or commences, the Participant’s Beneficiary shall receive the Participant’s remaining distributable interest under the Plan in the manner determined under Section 6 and any election of the Participant in effect as of the Participant’s date of death.

9.02    Pre-Termination. If a Participant dies prior to the date payment of the Participant’s distributable interest under the Plan is made or commences, the Participant’s Beneficiary shall receive the payment or payments, if any, the Participant would have received had the Participant terminated Service on the date of the Participant’s death.

SECTION 10.    FORFEITURE OF BENEFITS.

10.01    Removal for Cause. If a Participant is removed as an Outside Director for Cause, as determined by the Board of Directors, the Participant shall forfeit all benefits and rights under the Plan.

10.02    Obligations of Retired Outside Directors. A Participant shall forfeit any unpaid benefits under the Plan if after the Participant ceases to provide Services to the Corporation, the Participant (a) fails to remains available to provide advice and counsel to the Corporation or (b) engages in business activity or other conduct which the Board of Directors determines in its sole and absolute discretion is competitive to the Corporation’s interests following the Participant’s termination of Service; provided, however, that the obligations of this section do not apply after the effective date of a Change of Control or after a Participant’s death.

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SECTION 11.    ADJUSTMENTS TO UNITS.

In the event of (a) a reorganization, recapitalization, stock split, stock dividend, combination of Corporate Stocks, rights offering, merger, consolidation or other like change in the corporate structure or capital stock of the Corporation, (b) changes in generally accepted principles of accounting, (c) an extraordinary, nonrecurring event, such as a merger or sale or purchase of assets, resulting in an adjustment to the net book value of a Corporate Stock of Corporation Stock which, in the opinion of the Committee, inequitably affects the value of a Unit, or (d) a Change of Control, the Committee shall have the power and authority to make such adjustment, as it may deem appropriate, in the number of Units then credited to a Participant’s Account or in the net book value in order to preserve for each Participant rights substantially proportionate to such Participant’s rights existing prior to such event, provided however that in the event of a Change of Control in no event shall the net book value be an amount less than the net book value immediately preceding the Change of Control.

SECTION 12.    ADMINISTRATION.

The Plan shall be administered by the Committee, which may delegate its duties and powers in whole or in part to any subcommittee thereof; it is expected that such subcommittee shall consist solely of at least two individuals who are intended to qualify as “Non-Employee Directors” within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934 (or any successor rule thereto) and “outside directors” within the meaning of Section 162(m) of the Code; provided, however , that the failure of the subcommittee to be so constituted shall not impair the validity of any benefit made by such subcommittee. Subject to the provisions of the Plan, the Committee shall have exclusive power to determine the amount of, or method of determining, the benefit to be paid to the Participants. The Committee is authorized to interpret the Plan, to establish, amend or rescind any rules and regulations relating to the Plan and to make any other determinations that it deems necessary or desirable for the administration of the Plan. The Committee may correct any defect or supply any omission or reconcile any inconsistency in the Plan in the manner and to the extent the Committee deems necessary or desirable. Any decision of the Committee in the interpretation and administration of the Plan, as described herein, shall lie within its sole and absolute discretion and shall be final, conclusive and binding on all parties concerned (including, but not limited to, Participants and their beneficiaries or successors). The Committee shall have the full power and authority, consistent with the provisions of the Plan, to establish the terms and conditions of any benefit and to waive any such terms or conditions at any time. The Committee shall require payment of any amount it may determine to be necessary to withhold for federal, state, local or other taxes as a result of benefit paid under this Plan.

SECTION 13.    UNFUNDED PLAN.

13.01    Any benefit under this Plan is intended to constitute an “unfunded” deferred compensation benefit for Outside Directors and as such, to be exempt from ERISA.

13.02    Any amount due and payable pursuant to the terms of the Plan shall be paid out of the general assets of the Corporation. The Participants and any Beneficiaries shall not have an interest in any specific asset of the Corporation or any specific asset held hereunder as a result of this Plan. The Corporation shall have no obligation to set aside any funds for the purpose of making any benefit payments under this Plan. Nothing contained herein shall give the Participant or any Beneficiaries any rights that are greater than those of an unsecured creditor of the Corporation with respect to any unpaid benefits under this Plan. No action taken pursuant to the terms of this Plan shall be construed to create a funded arrangement, a plan asset, or fiduciary relationship among the Corporation, its designee, and the Participants or any Beneficiaries.

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SECTION 14.    AMENDMENT AND TERMINATION.

The Board of Directors reserves the right, at any time and from time to time, to alter, amend or terminate this Plan in whole or in part; provided, however, that no such action may reduce or eliminate the vested Account balance of any Participant.

SECTION 15.    DISPUTE RESOLUTION.

15.01    Arbitration.

(a)    The parties agree that any dispute or claim concerning this Plan or the terms thereof, including whether such dispute or claim is arbitrable, will be settled by arbitration. The arbitration proceedings shall be conducted under the Commercial Arbitration Rules of the American Arbitration Association in effect at the time a demand for arbitration under the rules is made. Either party shall make a demand for arbitration by giving a demand in writing to the other party.

(b)    The parties may agree upon one arbitrator, but in the event that they cannot agree, there shall be three, one named in writing by each of the parties and a third chosen by the two arbitrators. Should either party refuse or neglect to join in the appointment of the arbitrator(s) or to furnish the arbitrator(s) with any papers or information demanded, the arbitrator(s) are empowered by both parties to proceed ex parte. The arbitrators shall be persons who have a minimum of five years’ experience in resolving pension trust disputes during the ten years immediately preceding the dispute.

(c)    Arbitration shall take place in the Borough of New Providence, State of New Jersey, and the hearing before the arbitrator(s) of the matter to be arbitrated shall be at the time and place within said Borough as is selected by the arbitrator(s).

(d)    At the hearing, any relevant evidence may be presented by either party, and the formal rules of evidence and discovery applicable to judicial proceedings shall not be applicable. Evidence may be admitted or excluded in. the sole discretion of the arbitrator(s). Said arbitrator(s) shall hear and determine the matter and shall execute and acknowledge their binding award in writing and cause a copy thereof to be delivered to each of the parties. The decision of the arbitrator(s) including determination of amount of any damages suffered shall be exclusive, final and binding upon both parties, their heirs, executors, administrators, successors, and assigns.

(e)    A judgment confirming the award of the arbitrator(s) may be rendered by any court having jurisdiction; or such court may vacate, modify, or correct the award in accordance with the prevailing laws of the State of New Jersey. To the extent that any language contained in this arbitration clause shall be inconsistent with any provision of NJS 2A:24-1 et seq. or any provision of the Commercial Arbitration Rules referred to herein, it is the intention of the parties hereto that the subsequent inconsistent provision of this clause shall control.

(f)    Notwithstanding anything contrary in this Plan, this section is in no way an attempt to limit discovery which shall be at the sole discretion and prior approval of the arbitrator(s) and his (their) rulings on discovery shall be binding; however, he (they) is (are) to be guided by the most expeditious manner in resolving disputes under this Plan.

15.02    Costs and Attorney Fees.

The costs of such arbitration shall be borne by the Corporation. In the event that the Outside Director shall be the prevailing party in any arbitration or any action at law or in equity to enforce an arbitration

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award, the Corporation shall pay the Outside Director all costs, expenses and reasonable attorneys’ fees incurred therein by such Outside Director including, without limitation, such costs, expenses and fees on any appeals.

SECTION 16.    TRANSFERABILITY.

Neither the Outside Director nor the Outside Director’s Beneficiary or estate shall have any right to commute, sell, assign, transfer or otherwise convey the rights to receive any payment hereunder, which payments and all the rights thereto are expressly declared to be non-assignable and non-transferable, and in the event of any attempted assignment or transfer, the Corporation shall have no further liability hereunder. No benefit payment shall, in any manner be subject to garnishment, attachment, execution, levy, debts, contracts, liabilities, engagements or torts of the Outside Director or the Outside Director’s designated beneficiary or estate.

SECTION 17.    ASSIGNMENT.

Except as herein provided, this Plan shall be binding upon the parties hereto, their heirs, executors, administrators, successors (including but not limited to successors resulting from any corporate merger or acquisition) or assigns.

SECTION 18.    NO RIGHTS TO CONTINUED DIRECTORSHIP.

Nothing in this Plan shall confer upon a Outside Director any right to continue to service as a member of the Board of Directors or any committee of the Board of Directors, to be retained by the Corporation as a consultant or to be employed by the Corporation as an employee and shall not interfere in any way with the right of the Corporation to terminate the Outside Director’s service as a member of the Board of Directors or any committee of the Board of Directors as set forth in the by-laws of the Corporation or the Outside Director’s consulting or employment relationship with the Corporation, if any, at any time.

SECTION 19.    NOTICES.

Any notice required or permitted under this Plan shall be deemed given when delivered personally, or when deposited in a United States Post Office as registered mail, postage prepaid, addressed, as appropriate, either to the Outside Director at his or her address hereinabove set forth or such other address as he or she may designate in writing to the Corporation, or to the Corporation, Attention: Secretary, at 730 Central Avenue, Murray Hill, New Jersey 07974, or such other address as the Corporation may designate in writing to the Outside Director.

SECTION 20.    GOVERNING LAW.

This Plan shall be governed by and construed according to the laws of the State of New Jersey, determined without regard to its conflicts of law rules.

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EX-10.45

Exhibit 10.45

2005 DIRECTORS’ STOCK AWARD PLAN

OF

C. R. BARD, INC.

(AS AMENDED AND RESTATED)

Effective as of December 11, 2013, the 2005 Directors’ Stock Award Plan of C. R. Bard, Inc. (the “Plan”) is hereby amended and restated by C. R. Bard, Inc., a New Jersey corporation (the “Corporation”), as set forth herein.

The Corporation’s objectives in maintaining the Plan are (a) to attract and retain highly qualified individuals to serve on the Board of Directors of the Corporation, (b) to relate non-employee directors’ compensation more closely to the Corporation’s performance and its shareholders’ interests, and (c) to increase non-employee directors’ stock ownership in the Corporation.

SECTION 1. DEFINITIONS.

For purposes of the Plan, the following terms shall have the indicated meanings:

1.01 “Award” shall mean an Option, Stock Award, SAR or other stock-based award granted pursuant to the Plan.

1.02 “Board” shall mean the Board of Directors of the Corporation.

1.03 “Code” shall mean the Internal Revenue Code of 1986, as amended (or any successor statute thereto).

1.04 “Committee” shall mean the Governance Committee of the Board or such other committee as may be designated by the Board.

1.05 “Common Stock” shall mean the Common Stock of the Corporation, par value $0.25 per share.

1.06 “Corporation” shall mean C. R. Bard, Inc., a New Jersey corporation.

1.07 “Director” shall mean a member of the Board.

1.08 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

1.09 “Fair Market Value” shall mean on any given date: (a) the mean between the high and low sale price of the Common Stock on that day as reported on the New York Stock Exchange-Composite Transactions Tape or, if no sale of Common Stock shall have occurred on the New York Stock Exchange on that day, on the next preceding day on which there was a sale; or (b) in the case of a simultaneous exercise and sale, the actual price Optionee receives in the open market on the date of the exercise. If the Common Stock is not traded on the New York Stock Exchange, the Fair Market Value shall be the amount that is reasonably determined by the Committee.

1.10 “Option” shall mean a stock option granted pursuant to Section 5 of the Plan.

1.11 “Option Price” shall mean the purchase price per share of an Option, as determined pursuant to Section 5.04 of the Plan.

1.12 “Option Period” shall mean the period from the date of the grant of an Option to the date of its expiration as provided in Section 5.

1.13 “Optionee” shall mean a Participant who has been granted an Option under the Plan.

1.14 “Participant” shall mean any non-employee Director who receives an Award.

1.15 “Permanent Disability” shall mean any disability which prevents a Director from performing all duties as a Director.

1.16 “Plan” shall mean the C. R. Bard, Inc. 2005 Directors’ Stock Award Plan (as amended and restated).

1.17 “Retirement” shall mean the voluntary cessation of service as a director by a director who is 55 years of age or older and who has served on the Board for at least five years.

1.18 “SAR” shall mean stock appreciation right granted pursuant to Section 6 of the Plan.

1.19 “Stock Award” shall mean Common Stock awards granted pursuant to Section 4 of the Plan.

1.20 “Term” shall mean the number of years that the Participant is appointed or elected to serve as a Director.

1.21 “Transfer Restriction Period” shall mean the period of time during which a Stock Award will remain subject to the transfer restrictions set forth in Section 4.05 of the Plan.

1.22 “Unrestricted Stock” shall mean Common Stock awarded to a Participant which Common Stock is not subject to a vesting period or installment delivery specified by the Committee.

1.23 “Vesting Restriction Period” shall mean the period of time during which a Stock Award will remain subject to vesting restrictions as described in Section 4.01(b) of the Plan.

SECTION 2. SHARES SUBJECT TO THE PLAN.

Subject to adjustment as provided in Section 11, the total number of shares of Common Stock which may be issued under the Plan is 350,000. The shares may consist, in whole or in part, of unissued shares or treasury shares. The issuance of shares or the payment of cash upon the exercise of an Award or in consideration of the cancellation or termination of an Award shall reduce the total number of shares available under the Plan, as applicable. Shares subject to Awards which are forfeited, terminate or otherwise lapse will be added back to the aggregate number of shares available under the Plan.

SECTION 3. ADMINISTRATION.

3.01 Determination of Awards. Subject to the provisions of the Plan, the Committee shall have exclusive power to select the Participants and to determine the amount of, or method of determining, the Awards to be made to Participants. All Awards granted to Participants under the Plan shall be evidenced by an Award agreement which specifies the type of Award granted pursuant to the Plan, the number of shares of Common Stock underlying the Award and all terms governing the Award, including, without limitation, terms regarding vesting, exercisability and expiration of the Award.

3.02 Interpretation of Plan. The Committee is authorized to interpret the Plan, to establish, amend or rescind any rules and regulations relating to the Plan and to make any other determinations that it deems necessary or desirable for the administration of the Plan. The Committee may correct any defect or supply any omission or reconcile any inconsistency in the Plan in the manner and to the extent the Committee deems necessary or desirable. Any decision of the Committee in the interpretation and administration of the Plan, as described herein, shall lie within its sole and absolute discretion and shall be final, conclusive and binding on all parties concerned (including, but not limited to, Participants and their beneficiaries or successors). The Committee shall have the full power and authority, consistent with the provisions of the Plan, to establish the terms and conditions of any Award and to waive any such terms or conditions at any time (including, without limitation, accelerating or waiving any vesting conditions).

3.03 Tax Withholding. The Committee shall require payment of any amount it may determine to be necessary to withhold for federal, state, local or other taxes as a result of the exercise, grant or vesting of an Award as a condition to such exercise, grant or vesting. Unless the Committee specifies otherwise, the Participant may elect to pay a portion or all of such withholding taxes by (a) delivery in shares of Common Stock or (b) having shares of Common Stock withheld by the Corporation from any shares of Common Stock that would have otherwise been received by the Participant.

SECTION 4. STOCK AWARDS.

4.01 Formula Grant of Stock Award. For Directors elected prior to April 18, 2012, the following shall apply:

(a) Grant. On the first business day in October following the appointment or election of an individual as a Director (the “Formula Grant Date”), each nonemployee Director shall receive a Stock Award of 400 shares of Common Stock for each year or partial year remaining in his or her Term (other than a partial year resulting from the appointment or election of a Director subsequent to the October 1^st immediately preceding the annual meeting at which the term of office of such Director will expire).

(b) Formula Grant Vesting Restriction Period. Unless otherwise determined by the Committee, each Stock Award granted pursuant to Section 4.01 shall vest with respect to the first 400 shares of Common Stock on the Formula Grant Date and, with respect to the remaining shares of Common Stock included in such Stock Award, on each October 1 following the date on which

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the Stock Award was granted. If for any reason, the Participant ceases to serve as a Director prior to the date on which he or she is fully vested in the Stock Award granted under this Section 4.01, he or she shall forfeit all of the unvested shares underlying such Stock Award.

(c) Formula Grant Transfer Restriction Period. The transfer restrictions set forth in Section 4.05 of this Plan shall apply to shares of Common Stock underlying grants of Stock Awards made pursuant to this Section 4.01 until the second anniversary of the end of the Vesting Restriction Period applicable to such shares. Notwithstanding the foregoing sentence, however, the Transfer Restriction Period shall end upon the death or Permanent Disability of the Participant.

4.02 Value-Based Stock Awards.

(a) Grant. Subject to Section 7 below, on or about the date on which the annual management stock grants are made pursuant to the 2012 Long Term Incentive Plan of C. R. Bard, Inc. (as amended and restated) or a similar plan then in effect (the “Value-Based Grant Date”), each nonemployee Director shall receive a Stock Award based on the target equity value established by the Board that year prior to the Value-Based Grant Date (the “Target Equity Value”). To determine the appropriate number of shares granted for a value-based Stock Award, the Board shall (i) first subtract from the Target Equity Value the value of any formula Stock Award (or portion thereof) granted pursuant to Section 4.01 of the Plan with respect to the same year of such Director’s term for which a value-based Stock Award is being granted (the “Applicable Formula Award”) and (ii) then divide the remaining Target Equity Value by the average price of Common Stock as determined in a manner consistent with the manner used to determine annual grants to management of the Corporation in the year in which the value-based Stock Award is made. The value of the Applicable Formula Award shall be calculated by multiplying the Applicable Formula Award times such average price of Common Stock.

(b) Value-Based Grant. Except as otherwise provided by the Committee, Stock Awards granted pursuant to this Section 4.02 shall not vest earlier than the third anniversary of the date on which they are granted.

4.03 Additional Stock Awards. Subject to Section 7 below, the Committee may grant Stock Awards in addition to those provided in Sections 4.01 and 4.02 of the Plan in such form, and dependent on such conditions and restrictions (or without conditions and restrictions), as the Committee, in its sole discretion, shall determine and as set forth in the Stock Award agreement, including, without limitation, the right to receive, or vest with respect to the Stock Award upon the completion of a specified period of service as a Director, the occurrence of an event and/or the attainment of performance objectives, and all other terms and conditions of such Stock Award. Except as otherwise provided by the Committee, Stock Awards granted pursuant to this Section 4.03 shall not vest earlier than the third anniversary of the date on which they are granted. Restrictions on Stock Awards shall lapse over a period of time or according to such other criteria as set forth in the Stock Award agreement. Notwithstanding anything else to the contrary, a Stock Award that is not subject to vesting shall be made only in lieu of the payment of a cash retainer to the Director.

4.04 Termination of Director, Death, Permanent Disability, or Retirement.

(a) With respect to formula based Stock Awards (granted pursuant to Section 4.01) of the Plan, if for any reason, the Participant ceases to serve as a Director prior to the end of the Vesting Restriction Period applicable to such shares, he or she shall forfeit all unvested shares underlying such Stock Award.

(b) With respect to value-based and additional Stock Awards (granted pursuant to Sections 4.02 and 4.03 of the Plan), except as otherwise provided herein, in the event that a Participant ceases during the Vesting Restriction Period to be a Director for any reason other than death or Retirement, the Participant shall forfeit the Stock Award as to all shares of Common Stock covered by the Award with respect to which such Vesting Restriction Period has not ended, and those shares of Common Stock must be immediately returned to the Corporation. The Committee may, however, provide for complete or partial exceptions to this requirement as it deems appropriate.

(c) With respect to value-based and additional Stock Awards (granted pursuant to Sections 4.02 and 4.03 of the Plan), in the event the Participant ceases to be a Director during the Vesting Restriction Period due to death or Retirement, the Vesting Restriction Period shall terminate and all of the shares of Common Stock covered by the Award shall be free of all restrictions.

4.05 Restrictions on Transfer and Legend on Stock Certificate.

(a) During the Transfer Restriction Period set forth in Section 4.01(c) or in the applicable grant Agreement governing a Stock Award granted pursuant to Sections 4.02 or 4.03 of the Plan, a Participant may not sell, assign, transfer, pledge, or otherwise dispose of the shares of Common Stock of the Stock Award except as provided under Section 8. Shares of Common Stock related to a Stock Award shall be held at the Corporation’s transfer agent in book entry form and shall contain a legend giving appropriate notice of the restrictions in the Stock Award agreement. The Participant shall be entitled to have the legend removed from the book entry covering the shares of Common Stock subject to restrictions when all restrictions on such shares of Common Stock have lapsed.

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(b) Each share of Common Stock representing a Stock Award subject to restrictions shall be registered in the name of the Participant to whom the Stock Award was granted and bear the following, or a substantially similar, legend:

“The transferability of this Certificate and the Common Stock represented hereby is subject to the terms and conditions, including forfeiture, contained in Section 4 of the C. R. Bard, Inc. 2005 Directors’ Stock Award Plan, as amended from time to time, and an agreement entered into between the registered owner and C. R. Bard, Inc. Copies of the Plan and Stock Award agreement are on file in the executive office of C. R. Bard, Inc., 730 Central Avenue, Murray Hill, New Jersey 07974.”

4.06 Right to Vote and to Receive Dividends. During the Vesting Restriction Period and Transfer Restriction Period, the Participant shall have the right to vote shares of Common Stock subject to Stock Awards and to receive any dividends or other distributions paid on such shares of Common Stock.

4.07 Delivery of Certificates. When each of the Vesting Restriction Period and Transfer Restriction Period have lapsed with regard to shares of Common Stock related to a Stock Award, the Corporation shall direct the transfer agent to remove the restrictions relating to the Award or, at the Participant’s request, (or at the request of the Participant’s legal representative, beneficiary or heir) shall deliver within 60 days after such vesting to the Participant, or to the Participant’s legal representative, beneficiary or heir, a certificate or certificates without the legend referred to in Section 4.05 above, for such shares of Common Stock.

SECTION 5. OPTIONS.

5.01 Grant of Options. Subject to Section 7 below, the Committee, in its sole discretion, may grant Options to any Director under the Plan.

5.02 Term of Option. The term of any Option shall not exceed ten years from the date of grant.

5.03 Conditions of Option. Except to the extent otherwise provided in the Plan, Options shall be in such form, and dependent on such conditions, as the Committee shall determine and as set forth in the Option agreement, including, without limitation, the right to receive, or vest with respect to the Option upon the completion of a specified period of service as a Director, the occurrence of an event and/or the attainment of performance objectives, and all other terms and conditions of such Option.

5.04 Option Price. The Option Price per share of Common Stock shall not be less than 100% of the Fair Market Value of a share of Common Stock on the date the Option is granted. Notwithstanding any provision in this Plan to the contrary other than the last sentence of this paragraph, no Option may be amended to reduce the per share Option Price of any outstanding Option below the Option Price determined as of the date the Option is granted without the approval of the Corporation’s shareholders, nor may an Option or other Award be granted in exchange for, or in connection with, the cancellation or surrender of an Option or other Award having a higher Option Price or exercise price without the approval of the Corporation’s shareholders. The restrictions set forth in this Section 5.04 shall not apply to the assumption of, substitution for, or adjustment of outstanding Options that are assumed, substituted, or adjusted in connection with a transaction described in Section 11, provided that the aggregate Option Price times the number of shares underlying the Option immediately before the transaction equals or exceeds the aggregate Option Price times the number of shares underlying the Option (or substituted Option) immediately following the transaction.

5.05 Exercisability. Except as determined by the Committee and set forth in the Option agreement, an Option shall become exercisable with regard to twenty-five percent of the Option on the date of the four successive anniversary dates of the grant date. Further, all Options shall become immediately exercisable upon the death of a Participant if as of the date of the Participant’s death, the Participant had not otherwise ceased to be a Director. In no event shall an Option be exercisable at any time after the expiration of the term of the Option.

5.06 Exercise of Options. Except as otherwise provided in the Plan or in an Option agreement, an Option may be exercised for all, or from time to time any part, of the shares of Common Stock for which it is then vested and exercisable.

(a) The exercise date of an Option shall be the later of the date a notice of exercise is received by the Corporation and, if applicable, the date payment is received by the Corporation pursuant to (b) below.

(b) The purchase price for the shares of Common Stock as to which an Option is exercised shall be paid to the Corporation in full at the time of exercise at the election of the Participant (i) in cash or its equivalent

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(e.g., by check), (ii) to the extent permitted by the Committee, in shares of Common Stock having a Fair Market Value equal to the aggregate Option Price for the shares of Common Stock being purchased and satisfying such other requirements as may be imposed by the Committee; provided, that such shares of Common Stock have been held by the Participant for no less than six months (or such other period as established from time to time by the Committee in order to avoid adverse accounting treatment applying generally accepted accounting principles), (iii) partly in cash and, to the extent permitted by the Committee, partly in such shares of Common Stock or (iv) subject to rules and limitations established by the Committee, through the delivery of irrevocable instructions to a broker to sell shares of Common Stock obtained upon the exercise of the Option and to deliver promptly to the Corporation an amount out of the proceeds of such sale equal to the aggregate Option Price for the shares of Common Stock being purchased.

(c) No Participant shall have any rights to dividends or other rights of a stockholder with respect to shares of Common Stock subject to an Option until the Participant has given written notice of exercise of the Option, paid in full for such shares of Common Stock, received such shares of Common Stock from the Corporation and, if applicable, has satisfied any other conditions imposed by the Committee pursuant to the Plan.

(d) If a Participant pays the exercise price of an Option or taxes relating to the exercise of an Option by delivering shares of Common Stock, the Participant may, subject to procedures established by the Committee, satisfy such delivery requirement by presenting proof that he or she is the beneficial owner (as such term is defined in Rule 13d-3 under the Act (or any successor rule thereto)) of such shares of Common Stock, in which case the Corporation shall treat the Option as exercised without further payment and shall withhold such number of shares of Common Stock from the shares of Common Stock acquired by the exercise of the Option.

5.07 Cessation of Service as a Director.

(a) Except as provided below, an Option may be exercised at anytime during the term of the Option.

(b) Except as provided in Sections (c), (d) and (e) below, any of the Participant’s Options that are not otherwise exercisable as of the date on which the Participant ceases to be a Director for any reason shall terminate as of such date.

(c) Any of the Participant’s Options that are exercisable as of the date on which the Participant ceases to be a Director for any reason other than death or Retirement shall terminate sixty (60) days from the date the Participant ceases to be a Director; but in no event beyond the term of the Option.

(d) If a Participant ceases to be a Director by reason of his or her death, his or her personal representative shall be permitted to exercise his or her outstanding vested and unvested Option for a period of one (1) year from the date of the Director’s death, but in no event beyond the term of the Option.

(e) If a Participant ceases to be a Director by reason of his or her Retirement, his or her outstanding vested Option shall remain exercisable for the remaining term of the Option and the portion of his or her Option that was not vested on the date of his or her Retirement shall be forfeited. Notwithstanding the foregoing, if a Participant ceases to be a Director by reason of his or her Retirement, any of his or her outstanding vested Option issued on or prior to April 18, 2001 shall remain exercisable only for a period of three years from the last day of the month in which he or she retired and the portion of his or her Option that was not vested on the date of his or her Retirement shall be forfeited.

SECTION 6. STOCK APPRECIATION RIGHTS.

Subject to Section 7 below, the Committee, in its sole discretion, may grant SARs in connection with an Option, or a portion thereof. An SAR represents a right to receive appreciation on the Corporation’s Common Stock in cash or stock as the Committee shall determine. An SAR may be granted at the time the related Option is granted or at any time prior to the exercise or cancellation of the related Option, shall cover the same number of shares of Common Stock covered by an Option (or such lesser number of shares of Common Stock as the Committee may determine), and shall be subject to the same terms and conditions as such Option except for such additional limitations as are contemplated by this Section 6 (or such additional limitations as may be included in an Award agreement). Notwithstanding any provision in this Plan to the contrary other than the last sentence of this Section 6, no Stock Appreciation Right may be amended to reduce the exercise price per share of the shares subject to such Stock Appreciation Right below the exercise price determined as of the date the Stock Appreciation Right is granted, nor may a Stock Appreciation Right be granted in exchange for, or in connection with, the cancellation or surrender of a Stock Appreciation Right or other Award having a higher exercise price. The restrictions set forth in

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this Section 6 shall not apply to the assumption of, substitution for, or adjustment of outstanding Stock Appreciation Rights that are assumed, substituted, or adjusted in connection with a transaction described in Section 11, provided that the aggregate exercise price times the number of shares underlying the Stock Appreciation Right immediately before the transaction equals or exceeds the aggregate exercise price times the number of shares underlying the Stock Appreciation Right (or substituted Stock Appreciation Right) immediately following the transaction.

SECTION 7. LIMITATIONS ON AWARDS.

Notwithstanding any provision of this Plan to the contrary, the maximum aggregate grant date Fair Market Value of Awards granted to a Director during a calendar year shall not exceed $150,000; provided that Stock Awards that are granted in lieu of the payment of a cash retainer to a Director shall not be included in these limitations.

SECTION 8. TRANSFERABILITY OF AWARDS.

8.01 Limits on Transferability. Except as otherwise provided, Stock Awards (prior to the end of their Transfer Restriction Period), Options or SARs may not be assigned, alienated, attached, sold or transferred, pledged or otherwise disposed or encumbered by the Participant, other than by will or by the laws of descent and distribution. Any attempt to assign, transfer, pledge or otherwise dispose of an Award contrary to the provisions hereof, and the levy of any execution, attachment or similar process upon the Award, shall be null, void and without effect; provided, however, that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance. A Participant may designate a beneficiary, on a form supplied by the Committee, who may possess all rights with respect to an Award in the event of Employee’s death. No such permitted transfer of an Award to heirs or legatees of a Participant shall be effective to bind the Corporation unless the Committee shall have been furnished with written notice thereof and a copy of such evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee or transferees of the terms and conditions hereof.

8.02 Transferability of Certain Awards. Notwithstanding the foregoing, an Award agreement may provide that a Participant may transfer certain Awards to family members, or one or more trusts or other entities for the benefit of or owned by family members, consistent with applicable securities laws, provided that the Participant receives no consideration for the transfer of the Award and the transferred Award shall continue to be subject to the same terms and conditions as were applicable to the Award immediately before the transfer.

SECTION 9. NO LIMITATION ON RIGHTS OF THE CORPORATION.

The granting of any Awards under this Plan shall not in any way affect the right or power of the Corporation to make adjustments, reclassification or changes in its capital or business structure, or to merge, consolidate, dissolve, liquidate, sell or transfer all or any part of its business or assets.

SECTION 10. SHARE OF COMMON STOCK ISSUANCE AND DELIVERY IN COMPLIANCE WITH SECURITIES LAWS.

If in the opinion of counsel for the Corporation (who may be an employee of the Corporation or independent counsel employed by the Corporation), any issuance or delivery of shares of Common Stock to a Participant will violate the requirements of any applicable federal or state laws, rules or regulations (including, without limitation, the provisions of the Securities Act of 1933, as amended, or the Act), such issuance or delivery may be postponed until the Corporation is satisfied that the distribution will not violate such laws, rules or regulations. The transfer agent’s book entry relating to a Stock Award (and, if requested in accordance with Section 4.07 above, certificates delivered to Participants pursuant to the Plan) may bear such legends as the Corporation may deem advisable.

SECTION 11. ADJUSTMENT UPON CERTAIN EVENTS.

In the event after the Effective Date there is any share of Common Stock dividend or split, reorganization, recapitalization, merger, consolidation, spin-off, combination, combination or transaction or exchange of shares of Common Stock or other corporate exchange, or any distribution to shareholders of shares of Common Stock or other property or securities (other than regular cash dividends) or any transaction similar to the foregoing or other transaction that results in a change to the Corporation’s equity capitalization, the Committee in its sole discretion and without liability to any person may make such substitution or adjustment, if any, as it deems to be equitable or appropriate, as to (i) the number or kind of shares of Common Stock or other securities issued or reserved for issuance pursuant to the Plan or pursuant to outstanding Awards, (ii) the maximum number of shares of Common Stock

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for which Stock Awards, Options and Stock Appreciation Rights may be granted (ii) the Option Price, exercise price of any Stock Appreciation Right or purchase price of any Award and/or (iii) any other affected terms of an Award or the Plan.

SECTION 12. AMENDMENTS OR TERMINATION.

The Board may amend the Plan at any time, provided that no amendment shall be made without the approval of the shareholders of the Corporation that would (a) increase the maximum number of shares of Common Stock which may be acquired under the Plan, (b) extend the term during which Options may be granted under the Plan, (c) permit the Option Price or exercise price per share of Common Stock to be less than 100% of the Fair Market Value of the shares of Common Stock on the date an Option or Stock Appreciation Right is granted (other than as specifically provided in Sections 5.04 and 6), (d) terminate restrictions applicable to Awards (except in connection with a Participant’s death, Disability or termination of employment or in connection with a Change of Control) or (e) provide for Awards not permitted pursuant to the terms of the Plan. The Board shall also have the right to terminate the Plan at any time. Without the consent of a Participant (except as otherwise provided for in Section 11), no amendment shall materially diminish any of the rights of such Participant under any Award theretofore granted to such Participant under the Plan; provided, however, that the Committee may amend the Plan in such manner as it deems necessary to permit the granting of Awards meeting the requirements of the Code or other applicable laws.

SECTION 13. NO RIGHTS TO CONTINUED DIRECTORSHIP.

Nothing in this Agreement shall confer upon a Director any right to continue to service as a member of the Board of Directors or any committee of the Board of Directors, to be retained by the Corporation as a consultant or to be employed by the Corporation as an employee and shall not interfere in any way with the right of the Corporation to terminate the Director’s service as a member of the Board of Directors or any committee of the Board of Directors as set forth in the by-laws of the Corporation or the Director’s consulting or employment relationship with the Corporation, if any, at any time.

SECTION 14. CHOICE OF LAW.

The Plan shall be governed by and construed in accordance with the laws of the State of New Jersey without regard to conflicts of laws.

SECTION 15. EFFECTIVE DATE.

The Plan was originally effective as of July 13, 1988, was subsequently amended from time-to-time, and was amended and restated as of December 12, 2012 and October 9, 2013. The Plan was initially approved by the shareholders of the Corporation on April 19, 1989. The effective date of the Plan as amended and restated herein is December 11, 2013, provided, however that the version of the Plan that was last approved by the Corporation’s shareholders was effective as of April 19, 2006.

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EX-12.1

EXHIBIT 12.1

C. R. BARD, INC. AND SUBSIDIARIES

Exhibit 12.1 - Computation of Ratio of Earnings to Fixed Charges

	Three Months Ended March 31, 2017		Years Ended December 31,
			2016		2015		2014		2013			2012
(dollars in millions)
Earnings from operations before taxes	$	201.5	$	663.7	$	349.4	$	445.8	$	1,213.4		$	732.4
Add (Deduct):
Fixed charges		17.3		63.2		52.8		52.9		52.4			46.1
Undistributed earnings of equity investments		—		—		0.4		0.3		(1.0	)		(9.6	)
Earnings available for fixed charges	$	218.8	$	726.9	$	402.6	$	499.0	$	1,264.8		$	768.9
Fixed charges:
Interest, including amounts capitalized(1)	$	15.1	$	54.5	$	44.9	$	44.8	$	45.0		$	39.6
Proportion of rent expense deemed to represent interest factor		2.2		8.7		7.9		8.1		7.4			6.5
Fixed charges	$	17.3	$	63.2	$	52.8	$	52.9	$	52.4		$	46.1
Ratio of earnings to fixed charges		12.65		11.50		7.63		9.43		24.14			16.68

⁽¹⁾ Interest related to unrecognized tax benefits is included as income tax expense and not included in fixed charges.

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer

I, Timothy M. Ring, certify that:

1. I have reviewed this quarterly report on Form 10-Q of C. R. Bard, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 27, 2017

/s/ Timothy M. Ring

Timothy M. Ring

Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Chief Financial Officer

I, Christopher S. Holland, certify that:

1. I have reviewed this quarterly report on Form 10-Q of C. R. Bard, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 27, 2017

/s/ Christopher S. Holland

Christopher S. Holland

Senior Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

SECTION 1350 CERTIFICATIONS

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of C. R. Bard, Inc. on Form 10-Q for the period ended March 31, 2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Timothy M. Ring, Chairman and Chief Executive Officer of C. R. Bard, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of C. R. Bard, Inc.

/s/ Timothy M. Ring

Name: Timothy M. Ring

Date: April 27, 2017

EX-32.2

EXHIBIT 32.2

SECTION 1350 CERTIFICATIONS

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of C. R. Bard, Inc. on Form 10-Q for the period ended March 31, 2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Christopher S. Holland, Senior Vice President and Chief Financial Officer of C. R. Bard, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of C. R. Bard, Inc.

/s/ Christopher S. Holland

Name: Christopher S. Holland

Date: April 27, 2017

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2017 shares
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q1
Trading Symbol	BCR
Entity Registrant Name	BARD C R INC /NJ/
Entity Central Index Key	0000009892
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	72,417,180

XML

Condensed Consolidated Statements of Income - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Net sales	$ 938.8	$ 873.5
Costs and expenses:
Cost of goods sold	354.2	320.4
Marketing, selling and administrative expense	285.4	270.6
Research and development expense	70.0	68.3
Interest expense	15.1	11.3
Other (income) expense, net	12.6	60.0
Total costs and expenses	737.3	730.6
Income from operations before income taxes	201.5	142.9
Income tax provision	23.4	26.7
Net income	$ 178.1	$ 116.2
Basic earnings per share available to common shareholders	$ 2.42	$ 1.56
Diluted earnings per share available to common shareholders	$ 2.37	$ 1.54

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Net income	$ 178.1	$ 116.2
Other comprehensive income (loss):
Change in derivative instruments designated as cash flow hedges, net of tax	6.6	(9.2)
Foreign currency translation adjustments	4.6	1.6
Benefit plan adjustments, net of tax	2.2	1.7
Other comprehensive income (loss)	13.4	(5.9)
Comprehensive income	$ 191.5	$ 110.3

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Current assets
Cash and cash equivalents	$ 890.7	$ 905.0
Restricted cash	179.1	201.5
Accounts receivable, less allowances of $4,400 and $7,200, respectively	450.0	477.3
Inventories	497.2	483.0
Other current assets	283.8	249.6
Total current assets	2,300.8	2,316.4
Property, plant and equipment, at cost	865.0	847.1
Less accumulated depreciation and amortization	370.6	357.6
Net property, plant and equipment	494.4	489.5
Goodwill	1,261.0	1,260.5
Core and developed technologies, net	662.6	686.4
Other intangible assets, net	321.5	323.6
Deferred income taxes	38.7	64.4
Other assets	165.6	165.3
Total assets	5,244.6	5,306.1
Current liabilities
Short-term borrowings and current maturities of long-term debt	609.3	0.0
Accounts payable	102.0	96.0
Accrued expenses	715.0	809.5
Accrued compensation and benefits	118.1	186.1
Income taxes payable	15.3	17.3
Total current liabilities	1,559.7	1,108.9
Long-term debt	1,143.0	1,641.7
Other long-term liabilities	841.6	861.5
Deferred income taxes	28.5	18.9
Commitments and contingencies
Shareholders' investment:
Preferred stock, $1 par value, authorized 5,000,000 shares; none issued
Common stock, $0.25 par value, authorized 600,000,000 shares; issued and outstanding 72,417,180 shares at March 31, 2017 and 72,899,251 shares at December 31, 2016	18.1	18.2
Capital in excess of par value	2,389.3	2,346.8
Accumulated deficit	(513.5)	(454.4)
Accumulated other comprehensive loss	(222.1)	(235.5)
Total shareholders' investment	1,671.8	1,675.1
Total liabilities and shareholders' investment	$ 5,244.6	$ 5,306.1

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Accounts receivable, allowances	$ 4.4	$ 7.2
Preferred stock, par value	$ 1.0	$ 1.0
Preferred stock, authorized	5,000,000	5,000,000
Preferred stock, issued	0	0
Common stock, par value	$ 0.25	$ 0.25
Common stock, authorized	600,000,000	600,000,000
Common stock, issued	72,417,180	72,899,251
Common stock, outstanding	72,417,180	72,899,251

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Cash flows from operating activities:
Net income	$ 178.1	$ 116.2
Adjustments to reconcile net income to net cash provided by operating activities, net of acquired businesses:
Depreciation and amortization	51.0	53.0
Litigation charges, net	12.1	48.9
Restructuring and productivity initiative costs, net of payments	2.3	7.7
Deferred income taxes	36.2	20.9
Share-based compensation	27.2	26.2
Inventory reserves and provision for doubtful accounts	7.5	9.3
Other items	1.4	1.0
Changes in assets and liabilities, net of acquired businesses:
Accounts receivable	29.0	6.1
Inventories	(19.9)	(21.3)
Current liabilities	(121.9)	(138.2)
Taxes	(32.5)	(40.1)
Other, net	(29.9)	(22.5)
Net cash provided by operating activities	140.6	67.2
Cash flows from investing activities:
Capital expenditures	(22.7)	(20.5)
Payments made for purchases of businesses, net of cash acquired	(5.4)	(202.8)
Payments made for intangibles	(0.2)	(0.2)
Net cash used in investing activities	(28.3)	(223.5)
Cash flows from financing activities:
Change in short-term borrowings, net	110.0	525.6
Payment of long-term debt	0.0	(250.0)
Proceeds from exercises under share-based compensation plans, net	(9.1)	(6.5)
Excess tax benefit relating to share-based compensation plans	0.0	19.0
Purchases of common stock	(232.3)	(167.4)
Dividends paid	(19.3)	(18.0)
Payments of contingent consideration	(0.1)	(0.1)
Net cash (used in) provided by financing activities	(150.8)	102.6
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	1.8	(1.6)
Decrease in cash, cash equivalents, and restricted cash during the period	(36.7)	(55.3)
Balance at January 1	1,106.5	1,030.9
Balance at March 31	1,069.8	975.6
Cash paid for:
Interest	15.0	16.6
Income taxes	19.7	26.9
Non-cash transactions:
Purchases of businesses and related costs	$ 0.0	$ 17.1

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Basis of Presentation

3 Months Ended

Mar. 31, 2017

Basis of Presentation

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of C. R. Bard, Inc. and its subsidiaries (the “company” or “Bard”) should be read in conjunction with the audited consolidated financial statements and notes thereto included in Bard’s 2016 Annual Report on Form 10-K. These financial statements have been prepared on a basis that is substantially consistent with the accounting principles applied in the financial statements in Bard’s 2016 Annual Report on Form 10-K. The preparation of these financial statements requires the company to make estimates and judgments that affect reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities at the date of the financial statements. These financial statements include all normal and recurring adjustments necessary for a fair presentation. The accounts of most foreign subsidiaries are consolidated as of and for the quarters ended February 28, 2017 and February 29, 2016 and as of November 30, 2016. No events occurred related to these foreign subsidiaries during the months of March 2017, March 2016 or December 2016 that materially affected the financial position or results of operations of the company. The results for the interim periods presented are not necessarily indicative of the results expected for the year.

Reclassifications

Certain prior year amounts have been reclassified to conform to current year presentation.

Recently Adopted Accounting Pronouncements

In January 2017, the Financial Accounting Standards Board (“FASB”) issued an accounting standard update that clarifies the definition of a business by providing a more robust framework to evaluate whether transactions should be accounted for as an acquisition of assets or a business. This update is expected to reduce the number of transactions that will be accounted for as an acquisition of a business. The effects of this update will depend on future acquisitions. In 2017, the company adopted this update early.

In November 2016, the FASB issued an accounting standard update that requires the change in the total of cash, cash equivalents, and restricted cash to be shown in the statement of cash flows. As a result, transfers between cash, cash equivalents, and restricted cash will no longer be presented in the statement of cash flows. In 2017, the company adopted this update early on a retrospective basis. As a result of the adoption, changes in restricted cash of $130.2 million are no longer presented as a reduction in cash flows from investing activities in the prior period statement of cash flows. Restricted cash is now included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts.

In October 2016, the FASB issued an accounting standard update that requires the immediate recognition of the income tax effects of intra-entity transfers of assets other than inventory at the time of the transfer. In 2017, the company adopted this update early on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. As a result of the adoption, accumulated deficit was increased by $5.2 million and other current assets and deferred tax liabilities were reduced by $5.4 million and $0.2 million, respectively, as of the beginning of 2017.

In March 2016, the FASB issued an accounting standard update that includes multiple provisions intended to simplify various aspects of the accounting for share-based payments, including the income tax items and the classification of these items on the statement of cash flows. This update will result in the recognition of excess tax benefits to the consolidated statements of income (formerly recorded to capital in excess of par value) upon settlement of share-based compensation awards, which is largely dependent on the exercise/vesting of awards and variables such as the company’s stock price at the time of the exercise/vesting of awards and the exercise price of the underlying awards. This provision of the new guidance, which was required to be applied prospectively, resulted in the recognition of $27.0 million of excess tax benefits in the income tax provision. In addition, cash flows related to these excess tax benefits are now classified as cash flows from operating activities (formerly included as cash flows from financing activities). The company elected to adopt this provision of the new guidance prospectively. Lastly, in the diluted earnings per share available to common shareholders calculation, when applying the treasury stock method for shares that could be repurchased, the assumed proceeds no longer include the amount of excess tax benefits. This did not have a material impact on the company’s diluted earnings per share available to common shareholders calculation.

New Accounting Pronouncements Not Yet Adopted

In March 2017, the FASB issued an accounting standard update that requires that the service cost component of net periodic pension cost be reported in the same income statement line items in which other compensation costs are reported and all other components of net periodic pension cost be reported elsewhere in the income statement. This update will be effective as of the beginning of Bard’s 2018 fiscal year and is not expected to have a material impact on the company’s consolidated financial statements.

In February 2016, the FASB issued a new lease accounting standard. The new standard will require, among other items, lessees to recognize most leases on the balance sheet by recording a right-of-use asset and a lease liability. This standard will be effective as of the beginning of Bard’s 2019 fiscal year. Other than this impact to the company’s consolidated balance sheet, the new standard is not expected to have a material impact on the company’s consolidated financial statements.

In May 2014, the FASB issued an accounting standard that provides for a comprehensive model to use in the accounting for revenue arising from contracts with customers. Under this standard, revenue will be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued an accounting standard update to defer this standard’s effective date for one year, which will now begin with Bard’s 2018 fiscal year. Under this standard, the company expects to recognize royalty revenue in earlier periods than under its current policy, and to recognize revenue earlier for other contracts that do not meet the new criteria for recognizing revenue over time. In addition, revenue will be recognized in earlier periods where the company maintains risk of loss for products that are in-transit to the customer. The company has made substantial progress in its evaluation of the new standard, and other than these items, this standard is not expected to have a material impact on the company’s consolidated financial statements. The company will continue to assess the new standard, as well as updates to the standard that have been proposed by the FASB. The company intends to adopt the standard under the modified retrospective approach beginning with Bard’s 2018 fiscal year.

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Becton Dickinson Transaction

3 Months Ended

Mar. 31, 2017

Becton Dickinson Transaction

2. Becton Dickinson Transaction

On April 23, 2017, Bard entered into Agreement and Plan of Merger (the “Merger Agreement”) with Becton, Dickinson and Company (“BD”) and Lambda Corp., a wholly owned subsidiary of BD (“Merger Corp”), pursuant to which Bard will merge with Merger Corp and become a wholly owned subsidiary of BD (the “Merger”). Under the agreement, each outstanding share of common stock of Bard will be converted into the right to receive $222.93 in cash and 0.5077 of a share of common stock of BD, as may be adjusted pursuant to the terms of the Merger Agreement. Completion of the Merger is subject to customary closing conditions, including, among others, (1) the approval of the Merger Agreement by a majority of the votes cast by Bard’s shareholders at a special meeting held to vote on the Merger Agreement, among other items, (2) declaration of the effectiveness by the U.S. Securities and Exchange Commission (the “SEC”) of the Registration Statement on Form S-4 to be filed with the SEC by BD in connection with the shares of the stock of BD to be issued in the Merger, (3) approval for listing on the New York Stock Exchange of the stock of BD to be issued in the Merger, (4) obtaining antitrust approvals in the United States and certain other jurisdictions, (5) subject to certain exceptions, the accuracy of the representations and warranties of the other party and (6) material compliance by the other party with its obligations under the Merger Agreement. The transaction is expected to close in the fourth quarter of 2017. If the Merger Agreement is terminated, Bard may be required to pay BD an amount equal to fifty percent of BD’s out-of-pocket expenses incurred in connection with the Merger Agreement and the Merger and in certain other circumstances, Bard may be required to pay BD a termination fee of $750 million. The foregoing description of the Merger Agreement is qualified in its entirety by reference to the full text of the Merger Agreement attached as Exhibit 2.1 to the Form 8-K filed on April 24, 2017.

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Earnings per Common Share

3 Months Ended

Mar. 31, 2017

Earnings per Common Share

3. Earnings per Common Share

Earnings per share (“EPS”) is computed under the two-class method using the following common share information:

	Three Months Ended March 31,
	2017		2016
(dollars and shares in millions)
EPS Numerator:
Net income	$	178.1	$	116.2
Less: Income allocated to participating securities		0.9		0.6
Net income available to common shareholders	$	177.2	$	115.6
EPS Denominator:
Weighted average common shares outstanding		73.1		74.0
Dilutive common share equivalents from share-based compensation plans		1.6		1.2
Weighted average common and common equivalent shares outstanding, assuming dilution		74.7		75.2

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Income Taxes

3 Months Ended

Mar. 31, 2017

Income Taxes

4. Income Taxes

The effective tax rate for the quarter ended March 31, 2017 was 11.6%. As discussed in Note 1 of the notes to condensed consolidated financial statements, the company adopted an accounting standard update that resulted in the recognition of excess tax benefits to the income tax provision upon settlement of share-based compensation awards. As a result, the effective tax rate for the quarter ended March 31, 2017 reflected a benefit of $27.0 million partially offset by the discrete tax effects of litigation charges.

The effective tax rate for the quarter ended March 31, 2016 was 18.7% which reflected the discrete tax effects of litigation charges related to product liability claims, which were incurred in a high tax jurisdiction. See Note 7 of the notes to condensed consolidated financial statements.

At March 31, 2017, the total amount of liability for unrecognized tax benefits related to federal, state and foreign taxes was $21.9 million (of which $18.8 million would impact the effective tax rate, if recognized) plus $2.9 million of accrued interest. At December 31, 2016, the liability for unrecognized tax benefits was $21.5 million plus $2.6 million of accrued interest. Depending upon the result of open tax examinations and/or the expiration of applicable statutes of limitation, the company believes it is reasonably possible that the total amount of unrecognized tax benefits may decrease by up to $4.9 million within the next 12 months.

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Financial Instruments

3 Months Ended

Mar. 31, 2017

Financial Instruments

5. Financial Instruments

For further discussion regarding the company’s use of derivative instruments, see Note 1 of the notes to consolidated financial statements in Bard’s 2016 Annual Report on Form 10-K.

Foreign Exchange Derivative Instruments

The company enters into readily marketable forward and option contracts with financial institutions to help reduce its exposure to foreign currency exchange rate fluctuations. These contracts limit volatility because gains and losses associated with foreign currency exchange rate movements are generally offset by movements in the underlying hedged item. The notional value of the company’s forward currency contracts was $218.6 million and $243.2 million at March 31, 2017 and December 31, 2016, respectively.

The location and fair value of derivative instruments that are designated as hedging instruments recognized in the condensed consolidated balance sheets are as follows:

	Balance Sheet Location		Fair Value of Derivatives
Derivatives Designated as Hedging Instruments			March 31, 2017		December 31, 2016
(dollars in millions)
Forward currency contracts		Other current assets	$	9.2	$	10.9
Forward currency contracts		Other assets		4.2		3.9
			$	13.4	$	14.8
Forward currency contracts		Accrued expenses	$	0.6	$	6.2
			$	0.6	$	6.2

The location and amounts of gains and losses on derivative instruments designated as cash flow hedges and the impact on shareholders’ investment are as follows:

	Gain/(Loss) Recognized in Other Comprehensive Income (Loss)					Location of Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income		Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
	Three Months Ended March 31,							Three Months Ended March 31,
	2017		2016					2017			2016
(dollars in millions)
Forward currency contracts	$	5.2	$	(0.8	)		Cost of goods sold	$	(3.3	)	$	(2.4	)
Option currency contracts		—		(1.7	)		Cost of goods sold		(0.4	)		1.8
Interest rate swap contract		—		(14.5	)		Interest expense		(0.6	)		—
	$	5.2	$	(17.0	)			$	(4.3	)	$	(0.6	)

Financial Instruments Measured at Fair Value on a Recurring Basis

Fair value is defined as the exit price that would be received to sell an asset or paid to transfer a liability. Fair value is a market-based measurement that is determined using assumptions that market participants would use in pricing an asset or liability. The fair value guidance establishes a three-level hierarchy which maximizes the use of observable inputs and minimizes the use of unobservable inputs used in measuring fair value. The levels within the hierarchy range from Level 1 having observable inputs to Level 3 having unobservable inputs.

The fair values of the company’s forward currency contracts of $12.8 million and $8.6 million at March 31, 2017 and December 31, 2016, respectively, were measured using significant other observable inputs and valued by reference to similar financial instruments, adjusted for restrictions and other terms specific to each instrument. These financial instruments are categorized as Level 2 under the fair value hierarchy.

The fair value of the liability for contingent consideration related to acquisitions was $14.8 million and $14.9 million at March 31, 2017 and December 31, 2016, respectively. The fair value was measured using significant unobservable inputs and is categorized as Level 3 under the fair value hierarchy.

Financial Instruments Not Measured at Fair Value

The company maintains a $1 billion five-year committed syndicated bank credit facility that expires in November 2021. The credit facility supports the company’s commercial paper program and can be used for general corporate purposes. The facility includes pricing based on the company’s long-term credit ratings and includes a financial covenant that limits the amount of total debt to total capitalization. At March 31, 2017 the company was in compliance with this covenant. The fair value of commercial paper borrowings outstanding of $110.0 million at March 31, 2017 approximated its carrying value. There were no commercial paper borrowings outstanding at December 31, 2016.

The estimated fair value of long-term debt (including current maturities) was approximately $1,695.2 million and $1,688.0 million at March 31, 2017 and December 31, 2016, respectively. The fair value was estimated using dealer quotes for similarly-rated debt instruments over the remaining contractual term of the company’s obligation and is categorized as Level 2 under the fair value hierarchy.

The fair value of the deferred future payments related to the Medicon, Inc. acquisition of $54.8 million and $52.3 million at March 31, 2017 and December 31, 2016, respectively, approximated the carrying value. At March 31, 2017 and December 31, 2016, future payments of $41.4 million and $39.5 million, respectively, were recorded to other long-term liabilities. These payments will be paid in Japanese Yen and are subject to exchange rate fluctuations. The fair value was estimated by discounting the future payments based upon the timing of such payments and is categorized as Level 2 under the fair value hierarchy.

Concentration Risk

Accounts receivable balances include sales to government-supported healthcare systems outside the United States. The company monitors economic conditions and evaluates accounts receivable in certain countries for potential collection risks. Economic conditions and other factors in certain countries, particularly in Spain, Italy, Greece and Portugal, have resulted in, and may continue to result in, an increase in the average length of time that it takes to collect these accounts receivable and may require the company to re-evaluate the collectability of these receivables in future periods. At March 31, 2017, the company’s accounts receivable, net of allowances, from the national healthcare systems and private sector customers in these four countries was $40.1 million, of which $1.9 million was greater than 365 days past due.

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Inventories

3 Months Ended

Mar. 31, 2017

Inventories

6. Inventories

Inventories consisted of:

	March 31, 2017		December 31, 2016
(dollars in millions)
Finished goods	$	296.9	$	292.8
Work in process		35.5		27.0
Raw materials		164.8		163.2
	$	497.2	$	483.0

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Contingencies

3 Months Ended

Mar. 31, 2017

Contingencies

7. Contingencies

In the ordinary course of business, the company is subject to various legal proceedings, investigations and claims, including, for example, environmental matters, employment disputes, disputes on agreements and other commercial disputes. In addition, the company operates in an industry susceptible to significant product liability and patent legal claims. The company accounts for estimated losses with respect to legal proceedings and claims when such losses are probable and reasonably estimable. If the estimate of a probable loss is a range and no amount within the range is more likely, the company accrues the minimum amount of the range. Legal costs associated with these matters are expensed as incurred. At any given time, in the ordinary course of business, the company is involved as either a plaintiff or defendant in a number of patent infringement actions. If a third party’s patent infringement claim were to be determined against the company, the company might be required to make significant royalty or other payments or might be subject to an injunction or other limitation on its ability to manufacture or distribute one or more products. If a patent owned by or licensed to the company is found to be invalid or unenforceable, the company might be required to reduce the value of certain intangible assets on the company’s balance sheet and to record a corresponding charge, which could be significant in amount. Many of the company’s legal proceedings and claims could have a material adverse effect on its business, results of operations, financial condition and/or liquidity.

Product Liability Matters

Hernia Product Claims

As of March 31, 2017, approximately 25 federal and 80 state lawsuits involving individual claims by approximately 105 plaintiffs, as well as one putative class action in the United States, are currently pending against the company with respect to its Composix^® Kugel^® and certain other hernia repair implant products (collectively, the “Hernia Product Claims”). The company voluntarily recalled certain sizes and lots of the Composix^® Kugel^® products beginning in December 2005. In June 2007, the Composix^® Kugel^® lawsuits and, subsequently, other hernia repair product lawsuits, pending in federal courts nationwide were transferred into one Multidistrict Litigation (“MDL”) for coordinated pre-trial proceedings in the United States District Court for the District of Rhode Island. The MDL stopped accepting new cases in the second quarter of 2014 and was terminated in November 2016, at which time the remaining federal lawsuits were remanded to their courts of original jurisdiction for trial. As of March 31, 2017, all but one of the putative class actions pending against the company was dismissed. The remaining putative class action pending against the company has not been certified and seeks: (i) medical monitoring; (ii) compensatory damages; (iii) punitive damages; (iv) a judicial finding of defect and causation; and/or (v) attorneys’ fees. In April 2014, a settlement was reached with respect to the three putative Canadian class actions within amounts previously recorded by the company. Approximately 70 of the state lawsuits, involving individual claims by approximately 70 plaintiffs, are pending in the Superior Court of the State of Rhode Island, with the remainder in various other jurisdictions. The Hernia Product Claims also generally seek damages for personal injury resulting from use of the products.

The company has resolved the majority of its historical Hernia Product Claims, including through agreements or agreements in principle with various plaintiffs’ law firms to settle their respective inventories of cases. Each agreement involving the settlement of a firm’s inventory of claims was subject to certain conditions, including requirements for participation in the proposed settlements by a certain minimum number of plaintiffs. In addition, the company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Hernia Product Claims, and intends to vigorously defend Hernia Product Claims that do not settle, including through litigation. The company expects additional trials of Hernia Product Claims to take place over the next 12 months. The company cannot give any assurances that the resolution of the Hernia Product Claims that have not settled, including asserted and unasserted claims and the putative class action lawsuit, will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Women’s Health Product Claims

As of March 31, 2017, product liability lawsuits involving individual claims by approximately 5,305 plaintiffs are currently pending against the company in various federal and state jurisdictions alleging personal injuries associated with the use of certain of the company’s surgical continence products for women, which includes products manufactured by both the company and two subsidiaries of Medtronic plc (as successor in interest to Covidien plc) (“Medtronic”), each a supplier of the company. Medtronic has an obligation to defend and indemnify the company with respect to any product defect liability for products its subsidiaries had manufactured. As described below, in July 2015 the company reached an agreement with Medtronic regarding certain aspects of Medtronic’s indemnification obligation. In addition, five putative class actions in the United States and five putative class actions in Canada have been filed against the company, and a limited number of other claims have been filed or asserted in various non-U.S. jurisdictions. The foregoing lawsuits, unfiled or unknown claims, putative class actions and other claims, together with claims that have settled or are the subject of agreements or agreements in principle to settle, are referred to collectively as the “Women’s Health Product Claims”. The Women’s Health Product Claims generally seek damages for personal injury resulting from use of the products. The putative class actions, none of which has been certified, seek: (i) medical monitoring; (ii) compensatory damages; (iii) punitive damages; (iv) a judicial finding of defect and causation; and/or (v) attorneys’ fees. In April 2015, the Ontario Superior Court of Justice dismissed the plaintiffs’ motion for class certification in one Canadian putative class action. In March 2016, the company reached an agreement in principle to resolve all Canadian putative class actions, with the exception of a Quebec class action, within amounts previously recorded by the company, which settlement was finalized in September 2016. In January 2017, the court approved the discontinuance of the proposed Quebec class action.

In October 2010, the Women’s Health Product Claims involving solely Avaulta^® products pending in federal courts nationwide were transferred into an MDL in the United States District Court for the Southern District of West Virginia (the “WV District Court”), the scope of which was later expanded to include lawsuits involving all women’s surgical continence products that are manufactured or distributed by the company. The first trial in a state court was completed in California in July 2012 and resulted in a judgment against the company of approximately $3.6 million. On appeal the decision was affirmed by the appellate court in November 2014. The company filed a petition for review to the California Supreme Court on December 24, 2014, which was denied on February 18, 2015. The judgment in this matter, including interest and costs, was paid on March 20, 2015 within the amounts previously recorded by the company. The first trial in the MDL commenced in July 2013 and resulted in a judgment against the company of approximately $2 million, which was upheld by the Fourth Circuit on January 14, 2016. The company does not believe that any verdicts entered to date are representative of potential outcomes of all Women’s Health Product Claims. On January 16, 2014 and July 31, 2014, the WV District Court ordered that the company prepare 200 and then an additional 300 individual cases, respectively, for trial (the “2014 WHP Pre-Trial Orders”). The 2014 WHP Pre-Trial Orders resulted in significant additional litigation-related defense costs beginning in the second quarter of 2014 and continuing through the second quarter of 2015. In February 2015, the WV District Court appointed a Special Master to assist with settlement resolution. In June 2015, the WV District Court issued an order staying the requirement to prepare a significant portion of the cases covered by the 2014 WHP Pre-Trial Orders. Substantially all of the 500 individual cases that are the subject of the 2014 WHP Pre-Trial Orders have been part of agreements or agreements in principle to settle with various plaintiff law firms. In December 2016, the WV District Court lifted the stay of the 2014 WHP Pre-Trial Orders and remanded five of the unsettled cases to their courts of original jurisdiction for trial. In the first quarter of 2017, an additional 11 cases were remanded for trial for a total of 16 remanded cases. Five of those cases have been assigned trial dates between the third quarter of 2017 and the first quarter of 2018. In response to court orders on January 27, 2017 and March 3, 2017, the company is required to prepare an additional approximately 540 individual cases for trial (together with the 2014 WHP Pre-Trial Orders, the “WHP Pre-Trial Orders”). The WHP Pre-Trial Orders may result in material additional cost in future periods in defending Women’s Health Product Claims. The WV District Court may also order that the company prepare additional cases for trial, which could result in material additional costs in future periods.

As of March 31, 2017, the company reached agreements or agreements in principle with various plaintiffs’ law firms to settle their respective inventories of cases totaling approximately 11,005 Women’s Health Product Claims, including approximately: 560 during 2014, 6,215 during 2015, 4,155 during 2016 and approximately 75 during 2017. The company believes that these Women’s Health Product Claims are not the subject of Medtronic’s indemnification obligation. These settlement agreements and agreements in principle include unfiled and previously unknown claims held by various plaintiffs’ law firms, which have not been included in the approximate number of lawsuits set forth in the first paragraph of this section. Each agreement is subject to certain conditions, including requirements for participation in the proposed settlements by a certain minimum number of plaintiffs. The company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Women’s Health Product Claims, which may include additional inventory settlements. Notwithstanding these settlement efforts, the company anticipates additional trials over the next 12 months. In addition, one or more possible consolidated trials may occur in the future.

In July 2015, as part of the agreement noted above, Medtronic agreed to take responsibility for pursuing settlement of certain of the Women’s Health Product Claims that relate to products distributed by the company under supply agreements with Medtronic and the company has paid Medtronic $121 million towards these potential settlements. The company also may, in its sole discretion, transfer responsibility for settlement of additional Women’s Health Product Claims to Medtronic on similar terms. The agreement does not resolve the dispute between the company and Medtronic with respect to Women’s Health Product Claims that do not settle, if any. As part of the agreement, Medtronic and the company agreed to dismiss without prejudice their previously filed litigation with respect to Medtronic’s obligation to defend and indemnify the company.

The approximate number of lawsuits set forth in the first paragraph of this section does not include approximately 590 generic complaints involving women’s health products where the company cannot, based on the allegations in the complaints, determine whether any of those cases involve the company’s women’s health products. In addition, the approximate number of lawsuits set forth in the first paragraph of this section does not include approximately 865 claims that have been threatened against the company but for which complaints have not yet been filed. In addition, the company has limited information regarding the nature and quantity of these and other unfiled or unknown claims. During the course of engaging in settlement discussions with plaintiffs’ law firms, the company has learned, and may in future periods learn, additional information regarding these and other unfiled or unknown claims, or other lawsuits, which could materially impact the company’s estimate of the number of claims or lawsuits against the company. While the company continues to engage in discussions with other plaintiffs’ law firms regarding potential resolution of unsettled Women’s Health Product Claims and intends to vigorously defend the Women’s Health Product Claims that do not settle, including through litigation, it cannot give any assurances that the resolution of these claims will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Filter Product Claims

As of March 31, 2017, product liability lawsuits involving individual claims by approximately 1,755 plaintiffs are currently pending against the company in various federal and state jurisdictions alleging personal injuries associated with the use of the company’s vena cava filter products (all lawsuits, collectively, the “Filter Product Claims”). In August 2015, the Judicial Panel for Multi-District Litigation (“JPML”) ordered the creation of a Multi-District Litigation for all federal Filter Product Claims (the “IVC Filter MDL”) in the District of Arizona. There are approximately 1,705 Filter Product Claims that have been, or shortly will be, transferred to the IVC Filter MDL, including one medical monitoring class action. The remaining approximately 45 Filter Product Claims are pending in various state courts. In March 2016, a putative Canadian class action was filed against the company in Quebec. In April 2016 and May 2016, putative Canadian class actions were filed in Ontario and British Columbia, respectively. In November 2016, a putative Canadian class action was filed in Saskatchewan. The approximate number of lawsuits set forth above does not include approximately 25 claims that have been threatened against the company but for which complaints have not yet been filed. In addition, the company has limited information regarding the nature and quantity of these and other unfiled or unknown claims. The company continues to receive claims and lawsuits and may in future periods learn additional information regarding other unfiled or unknown claims, or other lawsuits, which could materially impact the company’s estimate of the number of claims or lawsuits against the company. The company expects that trials of Filter Product Claims may take place over the next 12 months. While the company intends to vigorously defend Filter Product Claims that do not settle, including through litigation, it cannot give any assurances that the resolution of these claims will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

General

In most product liability litigations (like those described above), plaintiffs allege a wide variety of claims, ranging from allegations of serious injury caused by the products to efforts to obtain compensation notwithstanding the absence of any injury. In many of these cases, the company has not yet received and reviewed complete information regarding the plaintiffs and their medical conditions and, consequently, is unable to fully evaluate the claims. The company expects that it will receive and review additional information regarding any remaining unsettled product liability matters.

The company believes that some settlements and judgments, as well as some legal defense costs, relating to product liability matters are or may be covered in whole or in part under its product liability insurance policies with a limited number of insurance carriers, or, in some circumstances, indemnification obligations to the company from other parties, which if disputed, the company intends to vigorously contest. Amounts recovered under the company’s product liability insurance policies or indemnification arrangements may be less than the stated coverage limits or less than otherwise expected and may not be adequate to cover damages and/or costs relating to claims. In addition, there is no guarantee that insurers or other parties will pay claims or that coverage or indemnity will be otherwise available.

In January 2017, the company reached an agreement to resolve litigation filed in the Southern District of New York by its insurance carriers in connection with Women’s Health Product Claims and Filter Product Claims. The agreement requires the insurance carriers to reimburse the company for certain future costs incurred in connection with Filter Product Claims up to an agreed amount. For certain product liability claims or lawsuits, the company does not maintain or has limited remaining insurance coverage.

Other Legal Matters

Since early 2013, the company has received subpoenas or Civil Investigative Demands from a number of State Attorneys General seeking information related to the sales and marketing of certain of the company’s products that are the subject of the Hernia Product Claims and the Women’s Health Product Claims. The company is cooperating with these requests. Although the company has had discussions with the State Attorneys General with respect to overall potential resolution of this matter, there can be no assurance that a resolution will be reached or what the terms of any such resolution may be. In the first quarter of 2017, the company recorded a charge to other (income) expense, net, of $7.5 million ($7.5 million after tax). Since it is not feasible to predict the outcome of these proceedings, the company cannot give any assurances that the resolution of these proceedings will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

In November 2015, the Department of Defense Inspector General issued an investigative subpoena to the company. The Department of Health and Human Services is also participating in this investigation. The subpoena seeks documents related to the company’s sales and marketing of certain filter products, drug coated balloon catheters, and peripheral arterial disease detection products. The company is cooperating with these requests. Since it is not feasible to predict the outcome of these proceedings, the company cannot give any assurances that the resolution of these proceedings will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

In June 2011, W. L. Gore & Associates, Inc. (“Gore”) filed suit in the U.S. District Court in Delaware alleging the company had infringed several of Gore’s patents. The trial began March 1, 2017, and was phased such that liability issues would be heard and decided by the jury first, with damages and willfulness to be heard immediately thereafter, if necessary. The liability phase was completed on March 8, 2017 with the jury finding the asserted Gore patent not valid and not infringed. Gore has the option to appeal and/or request a new trial or that the jury’s verdict be set aside. It is unclear what options Gore may choose or the outcome of the matter. The company intends to vigorously defend the allegations asserted by Gore. The company cannot give any assurances that an adverse resolution of this matter will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

The company is subject to numerous federal, state, local and foreign environmental protection laws governing, among other things, the generation, storage, use and transportation of hazardous materials and emissions or discharges into the ground, air or water. The company is or may become a party to proceedings brought under various federal laws including the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), commonly known as Superfund, the Resource Conservation and Recovery Act, the Clean Water Act, the Clean Air Act and similar state or foreign laws. These proceedings seek to require the owners or operators of contaminated sites, transporters of hazardous materials to the sites and generators of hazardous materials disposed of at the sites to clean up the sites or to reimburse the government for cleanup costs. In most cases, there are other potentially responsible parties that may be liable for remediation costs. In these cases, the government alleges that the defendants are jointly and severally liable for the cleanup costs; however, these proceedings are frequently resolved so that the allocation of cleanup costs among the parties more closely reflects the relative contributions of the parties to the site contamination. The company’s potential liability varies greatly from site to site. For some sites, the potential liability is de minimis and for others the costs of cleanup have not yet been determined. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than completion of the remedial feasibility study and are adjusted as further information develops or circumstances change. Costs of future expenditures for environmental remediation obligations are not discounted to their present value. Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed probable. The company believes that the proceedings and claims described above will likely be resolved over an extended period of time. While it is not feasible to predict the outcome of these proceedings, based upon the company’s experience, current information and applicable law, the company does not expect these proceedings to have a material adverse effect on its financial condition and/or liquidity. However, one or more of the proceedings could be material to the company’s business and/or results of operations.

Litigation Reserves

The company regularly monitors and evaluates the status of product liability and other legal matters, and may, from time-to-time, engage in settlement and mediation discussions taking into consideration developments in the matters and the risks and uncertainties surrounding litigation. These discussions could result in settlements of one or more of these claims at any time.

In the second quarter of 2015, the company recorded an additional charge related to these matters, net of estimated recoveries to other (income) expense, net, of approximately $337 million ($325 million after tax). The company recorded this charge based on additional information obtained during the quarter, including with respect to the factors noted above. Specifically the company considered the agreement and the agreement in principle by the company to settle approximately 2,880 Women’s Health Product Claims, the involvement of the Special Master in settlement resolution, additional settlements by other manufacturers subject to product liability claims with respect to similar products, and the continued rate of claims being filed (which led the company to increase its estimate of future Women’s Health Product Claims).

In the third quarter of 2015, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $241 million ($228 million after tax). The company recorded this charge based on additional information obtained with respect to the quarter, including with respect to the factors noted above. Specifically, the company considered the agreements and the agreement in principle by the company to settle approximately 3,030 Women’s Health Product Claims, discussions with plaintiffs’ counsel, additional information learned regarding the nature and quantity of unfiled and unknown claims (which led the company to increase its estimate of future Women’s Health Product Claims), a reconciliation of claims in connection with settlements, additional settlements by other manufacturers subject to product liability claims with respect to similar products, the rate of claims being filed, and the creation of the IVC Filter MDL.

In the first quarter of 2016, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $49 million ($31 million after tax). The company recorded this charge based on additional information obtained with respect to the quarter. Specifically, the company considered, among other factors, additional information learned regarding the nature and quantity of unfiled and filed claims, the increase in advertising by plaintiffs’ counsel with respect to IVC filters and an increase in the rate of claims being filed in Filter Product Claims (which led the company to increase its estimate of future Filter Product Claims).

In the third quarter of 2016, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $111 million ($77 million after tax). The company recorded this charge based on additional information obtained with respect to the quarter, including with respect to the factors noted above. Specifically, the company considered, among other factors, additional information learned regarding Product Liability Matters, including regarding the nature and quantity of unfiled and filed claims and the continued rate of claims being filed in certain Product Liability Matters (which led the company to increase its estimate of future claims for certain Product Liability Matters, including Filter Product Claims).

In the fourth quarter of 2016, the company recorded an additional charge related to these matters to other (income) expense, net, of approximately $46 million ($31 million after tax). The company recorded this charge based on additional information obtained with respect to the quarter, including regarding cases settled by certain other manufacturers, public information available from the court, unfiled and filed claims, the status of certain settlement discussions and information regarding plaintiff law firm inventories.

These charges recognized the estimated costs for the product liability matters discussed above, including (with respect to such matters) filed and an estimate of unfiled and unknown claims, and costs to administer the settlements related to such matters. These charges exclude any costs associated with certain of the putative class action lawsuits in the United States and Canada.

The company cannot give any assurances that the actual costs incurred with respect to these product liability matters will not exceed the related amounts accrued. With respect to product liability claims that are not resolved through settlement, the company intends to vigorously defend against such claims, including through litigation. The company cannot give any assurances that the resolution of any of its product liability matters, including filed, unfiled and unknown claims and the putative class action lawsuits, will not have a material adverse effect on the company’s business, results of operations, financial condition and/or liquidity.

Accruals for product liability and other legal matters amounted to $1,150.6 million, of which $563.4 million was recorded to accrued expenses, and $1,201.5 million, of which $605.3 million was recorded to accrued expenses, at March 31, 2017 and December 31, 2016, respectively. The company has made total payments of $795.0 million to qualified settlement funds (“QSFs”), subject to certain settlement conditions, for certain product liability matters since 2011, of which $32.6 million were made to QSFs during the three months ended March 31, 2017. Payments to QSFs are recorded as a component of restricted cash. Total payments of $617.7 million from these QSFs have been made to qualified claimants, of which $55.0 million were made during the three months ended March 31, 2017. In addition, other payments of $78.1 million have been made to qualified claimants, of which $4.8 million were made during the three months ended March 31, 2017.

The company recorded expected recoveries related to product liability matters amounting to $261.6 million, of which $163.3 million was recorded to other current assets, and $267.3 million, of which $156.2 million was recorded to other current assets, at March 31, 2017 and December 31, 2016, respectively. A substantial amount of these expected recoveries at March 31, 2017 and December 31, 2016 relate to the company’s agreements with Medtronic related to certain Women’s Health Product Claims. The terms of the company’s agreement with Medtronic are substantially consistent with the assumptions underlying, and the manner in which, the company has recorded expected recoveries related to the indemnification obligation. The expected recoveries at March 31, 2017 and December 31, 2016 related to the indemnification obligation are not in dispute with respect to claims that Medtronic settles pursuant to the agreement. As described above, the agreement does not resolve the dispute between the company and Medtronic with respect to Women’s Health Product Claims that do not settle, if any, and the company also may, in its sole discretion, transfer responsibility for settlement of additional Women’s Health Product Claims to Medtronic on similar terms.

The company is unable to estimate the reasonably possible losses or range of losses, if any, arising from certain existing product liability matters and other legal matters. Under U.S. generally accepted accounting principles, an event is “reasonably possible” if “the chance of the future event or events occurring is more than remote but less than likely” and an event is “remote” if “the chance of the future event or events occurring is slight”. With respect to putative class action lawsuits in the United States and certain of the Canadian lawsuits relating to product liability matters, the company is unable to estimate a range of reasonably possible losses for the following reasons: (i) all or certain of the proceedings are in early stages; (ii) the company has not received and reviewed complete information regarding all or certain of the plaintiffs and their medical conditions; and/or (iii) there are significant factual issues to be resolved. In addition, there is uncertainty as to the likelihood of a class being certified or the ultimate size of the class. With respect to the investigative subpoena issued by the Department of Defense Inspector General and the Department of Health and Human Services, the company is unable to estimate a range of reasonably possible losses for the following reasons: (i) all or certain of the proceedings are in early stages; and/or (ii) there are significant factual and legal issues to be resolved.

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Share-Based Compensation Plans

3 Months Ended

Mar. 31, 2017

Share-Based Compensation Plans

8. Share-Based Compensation Plans

The company may grant a variety of share-based payments under the 2012 Long Term Incentive Plan of C. R. Bard, Inc., as amended and restated (the “LTIP”) and the 2005 Directors’ Stock Award Plan of C. R. Bard, Inc., as amended and restated (the “Directors’ Plan”) to certain directors, officers and employees. The total number of remaining shares at March 31, 2017 that may be issued under the LTIP was 2,899,995 and under the Directors’ Plan was 21,890. Awards under the LTIP may be in the form of stock options, stock appreciation rights, limited stock appreciation rights, restricted stock, unrestricted stock and other stock-based awards. Awards under the Directors’ Plan may be in the form of stock awards, stock options or stock appreciation rights. The company also has two employee stock purchase programs.

For the quarters ended March 31, 2017 and 2016, amounts charged against income for share-based payment arrangements were $27.2 million and $26.2 million, respectively.

In the first quarter of each of 2017 and 2016, the company granted performance restricted stock units to certain officers. These units have requisite service periods of three years and have no dividend rights. The actual payout of these units varies based on the company’s performance over the three-year period based on pre-established targets over the period and a market condition modifier based on total shareholder return (“TSR”) compared to an industry peer group. The actual payout under these awards may exceed an officer’s target payout; however, compensation cost initially recognized assumes that the target payout level will be achieved and may be adjusted for subsequent changes in the expected outcome of the performance-related condition. The fair values of these units are based on the market price of the company’s stock on the date of the grant and use a Monte Carlo simulation model for the TSR component. The fair values of the TSR components of the 2017 and 2016 grants were estimated based on the following assumptions: risk-free interest rate of 1.37% and 0.83%, respectively; dividend yield of 0.47% and 0.52%, respectively; and expected life of 2.89 for both valuations.

As of March 31, 2017, there were $141.5 million of unrecognized compensation expenses related to share-based payment arrangements. These costs are expected to be recognized over a weighted-average period of approximately three years. The company has sufficient shares to satisfy expected share-based payment arrangements in 2017.

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Pension Plans

3 Months Ended

Mar. 31, 2017

Pension Plans

9. Pension Plans

The company has both tax-qualified and nonqualified, noncontributory defined benefit pension plans, that together cover certain domestic and foreign employees. These plans provide benefits based upon a participant’s compensation and years of service.

The components of net periodic pension cost are as follows:

	Three Months Ended March 31,
	2017			2016
(dollars in millions)
Service cost, net of employee contributions	$	6.6		$	7.3
Interest cost		4.8			4.7
Expected return on plan assets		(8.3	)		(8.1	)
Amortization		3.3			2.6
Net periodic pension cost	$	6.4		$	6.5

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Shareholders' Investment

3 Months Ended

Mar. 31, 2017

Shareholders' Investment

10. Shareholders’ Investment

The company repurchased approximately 1.0 million shares of common stock for $232.3 million in the three months ended March 31, 2017 under its previously announced share repurchase authorization.

Other Comprehensive Income (Loss)

The changes in accumulated other comprehensive income (loss) by component are as follows:

	Derivative Instruments Designated as Cash Flow Hedges			Foreign Currency Translation Adjustments			Benefit Plans			Total
(dollars in millions)
Balance at December 31, 2015	$	(8.7	)	$	(94.2	)	$	(105.1	)	$	(208.0	)
Other comprehensive income (loss) before reclassifications		(15.9	)		1.6			—			(14.3	)
Tax (provision) benefit (a)		5.5			—			—			5.5
Other comprehensive income (loss) before reclassifications, net of taxes		(10.4	)		1.6			—			(8.8	)
Reclassifications		0.6	(b)		—			2.6	(c)		3.2
Tax provision (benefit)		0.6			—			(0.9	)		(0.3	)
Reclassifications, net of tax		1.2			—			1.7			2.9
Other comprehensive income (loss)		(9.2	)		1.6			1.7			(5.9	)
Balance at March 31, 2016	$	(17.9	)	$	(92.6	)	$	(103.4	)	$	(213.9	)
Balance at December 31, 2016	$	(9.9	)	$	(116.0	)	$	(109.6	)	$	(235.5	)
Other comprehensive income (loss) before reclassifications		1.4			4.6			—			6.0
Tax (provision) benefit (a)		1.6			—			—			1.6
Other comprehensive income (loss) before reclassifications, net of taxes		3.0			4.6			—			7.6
Reclassifications		4.3	(b)		—			3.3	(c)		7.6
Tax provision (benefit)		(0.7	)		—			(1.1	)		(1.8	)
Reclassifications, net of tax		3.6			—			2.2			5.8
Other comprehensive income (loss)		6.6			4.6			2.2			13.4
Balance at March 31, 2017	$	(3.3	)	$	(111.4	)	$	(107.4	)	$	(222.1	)

(a) Income taxes are not provided for foreign currency translation adjustment.

(b) See Note 5 of the notes to condensed consolidated financial statements.

(c) These components are included in the computation of net periodic pension cost. See Note 9 of the notes to condensed consolidated financial statements.

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Segment Information

3 Months Ended

Mar. 31, 2017

Segment Information

11. Segment Information

The company’s management considers its business to be a single segment entity – the manufacture and sale of medical devices. The company’s products generally share similar distribution channels and customers. The company designs, develops, manufactures, packages, distributes and sells medical, surgical, diagnostic and patient care devices. The company sells a broad range of products to hospitals, individual healthcare professionals, extended care health facilities and alternate site facilities on a global basis. In general, the company’s products are intended to be used once and then discarded or either temporarily or permanently implanted. The company’s chief operating decision makers evaluate their various global product portfolios on a net sales basis and generally evaluate profitability and associated investment on an enterprise-wide basis due to shared geographic infrastructures.

Net sales based on the location of external customers by geographic region are:

	Three Months Ended March 31,
	2017		2016
(dollars in millions)
United States	$	657.2	$	625.4
Europe		103.2		104.3
Asia-Pacific(A)		126.3		97.9
Other(A)		52.1		45.9
	$	938.8	$	873.5

(A) Beginning in the fourth quarter of 2016, net sales for Asia-Pacific are separately reported. Prior year amount have been reclassified to conform to current year presentation.

Total net sales by product group category are:

	Three Months Ended March 31,
	2017		2016
(dollars in millions)
Vascular	$	256.6	$	239.5
Urology		237.7		216.7
Oncology		255.5		241.9
Surgical Specialties		165.1		151.4
Other		23.9		24.0
	$	938.8	$	873.5

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Earnings per Common Share (Tables)

3 Months Ended

Mar. 31, 2017

Earnings Per Share Computation

Earnings per share (“EPS”) is computed under the two-class method using the following common share information:

	Three Months Ended March 31,
	2017		2016
(dollars and shares in millions)
EPS Numerator:
Net income	$	178.1	$	116.2
Less: Income allocated to participating securities		0.9		0.6
Net income available to common shareholders	$	177.2	$	115.6
EPS Denominator:
Weighted average common shares outstanding		73.1		74.0
Dilutive common share equivalents from share-based compensation plans		1.6		1.2
Weighted average common and common equivalent shares outstanding, assuming dilution		74.7		75.2

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Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2017

Location and Fair Value of Derivative Instruments Designated as Hedging Instruments

The location and fair value of derivative instruments that are designated as hedging instruments recognized in the condensed consolidated balance sheets are as follows:

	Balance Sheet Location		Fair Value of Derivatives
Derivatives Designated as Hedging Instruments			March 31, 2017		December 31, 2016
(dollars in millions)
Forward currency contracts		Other current assets	$	9.2	$	10.9
Forward currency contracts		Other assets		4.2		3.9
			$	13.4	$	14.8
Forward currency contracts		Accrued expenses	$	0.6	$	6.2
			$	0.6	$	6.2

Location and Amounts of Gains and Losses on Derivative Instruments Designated as Cash Flow Hedges

The location and amounts of gains and losses on derivative instruments designated as cash flow hedges and the impact on shareholders’ investment are as follows:

	Gain/(Loss) Recognized in Other Comprehensive Income (Loss)					Location of Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income		Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
	Three Months Ended March 31,							Three Months Ended March 31,
	2017		2016					2017			2016
(dollars in millions)
Forward currency contracts	$	5.2	$	(0.8	)		Cost of goods sold	$	(3.3	)	$	(2.4	)
Option currency contracts		—		(1.7	)		Cost of goods sold		(0.4	)		1.8
Interest rate swap contract		—		(14.5	)		Interest expense		(0.6	)		—
	$	5.2	$	(17.0	)			$	(4.3	)	$	(0.6	)

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Inventories (Tables)

3 Months Ended

Mar. 31, 2017

Inventories

Inventories consisted of:

	March 31, 2017		December 31, 2016
(dollars in millions)
Finished goods	$	296.9	$	292.8
Work in process		35.5		27.0
Raw materials		164.8		163.2
	$	497.2	$	483.0

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Pension Plans (Tables)

3 Months Ended

Mar. 31, 2017

Components of Net Periodic Pension Cost

The components of net periodic pension cost are as follows:

	Three Months Ended March 31,
	2017			2016
(dollars in millions)
Service cost, net of employee contributions	$	6.6		$	7.3
Interest cost		4.8			4.7
Expected return on plan assets		(8.3	)		(8.1	)
Amortization		3.3			2.6
Net periodic pension cost	$	6.4		$	6.5

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Shareholders' Investment (Tables)

3 Months Ended

Mar. 31, 2017

Changes in Accumulated Other Comprehensive Income (Loss) by Component

The changes in accumulated other comprehensive income (loss) by component are as follows:

	Derivative Instruments Designated as Cash Flow Hedges			Foreign Currency Translation Adjustments			Benefit Plans			Total
(dollars in millions)
Balance at December 31, 2015	$	(8.7	)	$	(94.2	)	$	(105.1	)	$	(208.0	)
Other comprehensive income (loss) before reclassifications		(15.9	)		1.6			—			(14.3	)
Tax (provision) benefit (a)		5.5			—			—			5.5
Other comprehensive income (loss) before reclassifications, net of taxes		(10.4	)		1.6			—			(8.8	)
Reclassifications		0.6	(b)		—			2.6	(c)		3.2
Tax provision (benefit)		0.6			—			(0.9	)		(0.3	)
Reclassifications, net of tax		1.2			—			1.7			2.9
Other comprehensive income (loss)		(9.2	)		1.6			1.7			(5.9	)
Balance at March 31, 2016	$	(17.9	)	$	(92.6	)	$	(103.4	)	$	(213.9	)
Balance at December 31, 2016	$	(9.9	)	$	(116.0	)	$	(109.6	)	$	(235.5	)
Other comprehensive income (loss) before reclassifications		1.4			4.6			—			6.0
Tax (provision) benefit (a)		1.6			—			—			1.6
Other comprehensive income (loss) before reclassifications, net of taxes		3.0			4.6			—			7.6
Reclassifications		4.3	(b)		—			3.3	(c)		7.6
Tax provision (benefit)		(0.7	)		—			(1.1	)		(1.8	)
Reclassifications, net of tax		3.6			—			2.2			5.8
Other comprehensive income (loss)		6.6			4.6			2.2			13.4
Balance at March 31, 2017	$	(3.3	)	$	(111.4	)	$	(107.4	)	$	(222.1	)

(a) Income taxes are not provided for foreign currency translation adjustment.

(b) See Note 5 of the notes to condensed consolidated financial statements.

(c) These components are included in the computation of net periodic pension cost. See Note 9 of the notes to condensed consolidated financial statements.

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2017

Net Sales Based on the Location of External Customers by Geographic Region

Net sales based on the location of external customers by geographic region are:

	Three Months Ended March 31,
	2017		2016
(dollars in millions)
United States	$	657.2	$	625.4
Europe		103.2		104.3
Asia-Pacific(A)		126.3		97.9
Other(A)		52.1		45.9
	$	938.8	$	873.5

(A) Beginning in the fourth quarter of 2016, net sales for Asia-Pacific are separately reported. Prior year amount have been reclassified to conform to current year presentation.

Total Net Sales by Product Group Category

Total net sales by product group category are:

	Three Months Ended March 31,
	2017		2016
(dollars in millions)
Vascular	$	256.6	$	239.5
Urology		237.7		216.7
Oncology		255.5		241.9
Surgical Specialties		165.1		151.4
Other		23.9		24.0
	$	938.8	$	873.5

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Basis of Presentation - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Income tax provision	$ (23.4)	$ (26.7)
New Accounting Pronouncement, 2016-16
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect on retained earnings, net of tax	5.2
Impact on other current assets	5.4
Deferred tax liability, intra-entity transfer, asset other than inventory	0.2
New Accounting Pronouncement, 2016-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Income tax provision	27.0
New Accounting Pronouncement, 2016-18
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Change in restricted cash	$ 130.2

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Becton Dickinson Transaction - Additional Information (Detail) - Subsequent Event $ / shares in Units, $ in Millions	Apr. 23, 2017 USD ($) $ / shares shares
Business Acquisition [Line Items]
Contingent termination fee payable under agreement | $	$ 750
Out of pocket expenses of acquirer that must be reimbursed by the acquiree in event of deal termination	50.00%
C. R. Bard, Inc. | Becton Dickinson and Company
Business Acquisition [Line Items]
Business combination share price | $ / shares	$ 222.93
Business combination Common stock shares outstanding converted into rights to receive, per share | shares	0.5077

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Earnings Per Share Computation (Detail) - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Net income	$ 178.1	$ 116.2
Less: Income allocated to participating securities	0.9	0.6
Net income available to common shareholders	$ 177.2	$ 115.6
Weighted average common shares outstanding	73.1	74.0
Dilutive common share equivalents from share-based compensation plans	1.6	1.2
Weighted average common and common equivalent shares outstanding, assuming dilution	74.7	75.2

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Income Taxes - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Income Tax [Line Items]
Effective income tax rate	11.60%	18.70%
Income tax provision	$ (23.4)	$ (26.7)
Unrecognized tax benefits related to federal, state and foreign taxes	21.9		$ 21.5
Unrecognized tax benefits that would impact effective tax rate	18.8
Accrued interest	2.9		$ 2.6
Decrease in unrecognized tax benefits within the next 12 months	$ 4.9
Number of months unrecognized tax benefits may decrease	12 months
New Accounting Pronouncement, 2016-09
Income Tax [Line Items]
Income tax provision	$ 27.0

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Financial Instruments - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2017 USD ($) Country	Dec. 31, 2016 USD ($)
Commercial Paper
Derivative [Line Items]
Commercial paper borrowings outstanding	$ 110,000,000	$ 0
Five Year Credit Facility Expiring In November 2021
Derivative [Line Items]
Line of credit facility, borrowing capacity	$ 1,000,000,000
Line of credit facility, expiration date	2021-11
Line of credit facility, term, in years	5 years
National Healthcare Systems and Private Sector Customers | Spain, Italy, Greece, and Portugal
Derivative [Line Items]
Accounts receivable, net	$ 40,100,000
Accounts receivable greater than 365 days past due	$ 1,900,000
The number of countries in Europe in which certain collection risks exist | Country	4
Medicon Inc | Other Long-term Liabilities
Derivative [Line Items]
Liability for deferred future payments for business combinations	$ 41,400,000	39,500,000
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Recurring
Derivative [Line Items]
Fair value of contingent consideration	14,800,000	14,900,000
Fair Value, Inputs, Level 2
Derivative [Line Items]
Fair value of long-term debt including current maturities	1,695,200,000	1,688,000,000
Fair Value, Inputs, Level 2 | Forward currency contracts | Fair Value, Measurements, Recurring
Derivative [Line Items]
Fair values of forward currency contracts	12,800,000	8,600,000
Fair Value, Inputs, Level 2 | Medicon Inc
Derivative [Line Items]
Liability for deferred future payments for business combinations	54,800,000	52,300,000
Foreign Exchange Contract
Derivative [Line Items]
Notional value of derivative contracts	$ 218,600,000	$ 243,200,000

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Location and Fair Value of Derivative Instruments Designated as Hedging Instruments (Detail) - Derivatives Designated as Hedging Instruments - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Derivatives, Fair Value [Line Items]
Fair value of derivative assets	$ 13.4	$ 14.8
Fair value of derivative liability	0.6	6.2
Forward currency contracts | Other Current Assets
Derivatives, Fair Value [Line Items]
Fair value of derivative assets	9.2	10.9
Forward currency contracts | Other Assets
Derivatives, Fair Value [Line Items]
Fair value of derivative assets	4.2	3.9
Forward currency contracts | Accrued Expenses
Derivatives, Fair Value [Line Items]
Fair value of derivative liability	$ 0.6	$ 6.2

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Location and Amounts of Gains and Losses on Derivative Instruments Designated as Cash Flow Hedges (Detail) - Cash flow hedges - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(Loss) Recognized in Other Comprehensive Income (Loss)	$ 5.2	$ (17.0)
Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income	(4.3)	(0.6)
Forward currency contracts
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(Loss) Recognized in Other Comprehensive Income (Loss)	5.2	(0.8)
Forward currency contracts | Cost of Goods Sold
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income	(3.3)	(2.4)
Option currency contracts
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(Loss) Recognized in Other Comprehensive Income (Loss)	0.0	(1.7)
Option currency contracts | Cost of Goods Sold
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income	(0.4)	1.8
Interest rate swap contract
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(Loss) Recognized in Other Comprehensive Income (Loss)	0.0	(14.5)
Interest rate swap contract | Interest Expense
Derivative Instruments, Gain (Loss) [Line Items]
Gain/(Loss) Reclassified from Accumulated Other Comprehensive Loss into Income	$ (0.6)	$ 0.0

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Inventories (Detail) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Inventory [Line Items]
Finished goods	$ 296.9	$ 292.8
Work in process	35.5	27.0
Raw materials	164.8	163.2
Inventory, net, total	$ 497.2	$ 483.0

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Contingencies - Additional Information (Detail) $ in Millions				1 Months Ended							3 Months Ended						4 Months Ended	9 Months Ended	12 Months Ended			75 Months Ended
	Mar. 31, 2017 USD ($) LegalMatter Subsidiary Plaintiff Claim Trial Proceeding	Jul. 31, 2014 LegalMatter	Jan. 16, 2014 LegalMatter	Mar. 03, 2017 LegalMatter	Dec. 31, 2016 USD ($) LegalMatter	Apr. 30, 2015 LegalMatter	Apr. 30, 2014 LegalMatter	Jul. 31, 2013 USD ($)	Jul. 31, 2012 USD ($)	Jun. 30, 2007 LegalMatter	Mar. 31, 2017 USD ($) LegalMatter	Dec. 31, 2016 USD ($)	Sep. 30, 2016 USD ($)	Mar. 31, 2016 USD ($)	Sep. 30, 2015 USD ($) LegalMatter	Jun. 30, 2015 USD ($) LegalMatter	Mar. 31, 2017 USD ($) LegalMatter	Mar. 31, 2016 USD ($)	Dec. 31, 2016 USD ($) LegalMatter	Dec. 31, 2015 LegalMatter	Dec. 31, 2014 LegalMatter	Mar. 31, 2017 USD ($) LegalMatter
Commitments and Contingencies [Line Items]
Product claims, charges incurred after tax | $											$ 7.5	$ 31.0	$ 77.0	$ 31.0	$ 228.0	$ 325.0
Accruals for product liability and other legal matters | $	$ 1,150.6				$ 1,201.5						1,150.6	1,201.5					$ 1,150.6		$ 1,201.5			$ 1,150.6
Payments to qualified settlement fund | $											32.6											795.0
Payments to qualified claimants from qualified settlement funds | $											55.0											617.7
Other payments to qualified claimants from qualified settlement funds | $											4.8											78.1
Minimum
Commitments and Contingencies [Line Items]
Proceedings that could be material to the company | Proceeding	1
Cases that could be settled at any time | Claim	1
Accrued Expenses
Commitments and Contingencies [Line Items]
Accruals for product liability and other legal matters, accrued expenses | $	$ 563.4				605.3						563.4	605.3					563.4		605.3			563.4
Receivables Related to Product Liability Matters
Commitments and Contingencies [Line Items]
Receivables related to product liability matters | $	261.6				267.3						261.6	267.3					261.6		267.3			261.6
Receivables Related to Product Liability Matters | Other Current Assets
Commitments and Contingencies [Line Items]
Receivables related to product liability matters , current | $	$ 163.3				$ 156.2						163.3	156.2					$ 163.3		$ 156.2			$ 163.3
Other (income) expense, net
Commitments and Contingencies [Line Items]
Product claims, charges incurred before taxes | $											$ 7.5	$ 46.0	$ 111.0	$ 49.0	$ 241.0	$ 337.0
Hernia Product Claims
Commitments and Contingencies [Line Items]
Number of individual plaintiffs | Plaintiff	105
Period for additional product claims trials	12 months
Hernia Product Claims | United States
Commitments and Contingencies [Line Items]
Number of putative class actions	1
Hernia Product Claims | Canada
Commitments and Contingencies [Line Items]
Number of putative class actions settled							3
Hernia Product Claims | Federal Law Claims
Commitments and Contingencies [Line Items]
Number of lawsuits	25										25						25					25
Hernia Product Claims | State Law Claims
Commitments and Contingencies [Line Items]
Number of lawsuits	80										80						80					80
Hernia Product Claims | State Law Claims | Superior Court of State of Rhode Island
Commitments and Contingencies [Line Items]
Number of lawsuits	70										70						70					70
Number of individual plaintiffs | Plaintiff	70
Number of multidistrict litigations										1
Women's Health Product Claims
Commitments and Contingencies [Line Items]
Number of individual plaintiffs | Plaintiff	5,305
Period for additional product claims trials	12 months
Number of claims in settlement agreement	11,005										75								4,155	6,215	560
Generic complaints | Claim	590
Number of claims not yet filed	865
The number of claims subject to an agreement or an agreement in principle															3,030	2,880
Women's Health Product Claims | Minimum
Commitments and Contingencies [Line Items]
Number of additional trials | Trial	1
Women's Health Product Claims | United States
Commitments and Contingencies [Line Items]
Number of putative class actions	5
Women's Health Product Claims | Canada
Commitments and Contingencies [Line Items]
Number of putative class actions	5
Women's Health Product Claims | California state case
Commitments and Contingencies [Line Items]
U. S. District Court award for plaintiff's damages | $									$ 3.6
Women's Health Product Claims | Medtronic
Commitments and Contingencies [Line Items]
Number of subsidiaries of a parent company that have an obligation to indemnify | Subsidiary	2
Women's Health Product Claims | Medtronic
Commitments and Contingencies [Line Items]
Total payments made for settlement of indemnification obligation | $																		$ 121.0
Women's Health Product Claims | Ontario Superior Court of Justice | Canada
Commitments and Contingencies [Line Items]
Number of putative class actions with class certifications dismissed						1
Class actions settled											In March 2016, the company reached an agreement in principle to resolve all Canadian putative class actions, with the exception of a Quebec class action, within amounts previously recorded by the company, which settlement was finalized in September 2016.
Class actions discontinued											In January 2017, the court approved the discontinuance of the proposed Quebec class action.
Women's Health Product Claims | Multi District Litigation
Commitments and Contingencies [Line Items]
U. S. District Court award for plaintiff's damages | $								$ 2.0
Number of individual case for trial		300	200	540
Cases part of agreements or agreements in principle											Substantially all of the 500 individual cases that are the subject of the 2014 WHP Pre-Trial Orders have been part of agreements or agreements in principle to settle with various plaintiff law firms.
Number of individual case for trial					5						11						16
Women's Health Product Claims | Multi District Litigation | Unsettled Cases
Commitments and Contingencies [Line Items]
Number of individual case for trial	5
Filter Product Claims
Commitments and Contingencies [Line Items]
Number of individual plaintiffs | Plaintiff	1,755
Number of multidistrict litigations	1
Period for additional product claims trials	12 months
Number of claims not yet filed	25
Filter Product Claims | Canada
Commitments and Contingencies [Line Items]
Number of putative class actions	4
Filter Product Claims | State Law Claims
Commitments and Contingencies [Line Items]
Number of lawsuits	45										45						45					45
Filter Product Claims | Multi District Litigation
Commitments and Contingencies [Line Items]
Number of lawsuits	1,705										1,705						1,705					1,705

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Share-Based Compensation Plans - Additional Information (Detail) $ in Millions	3 Months Ended
	Mar. 31, 2017 USD ($) CompensationPlan shares	Mar. 31, 2016 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of employee stock purchase programs | CompensationPlan	2
Share-based payment arrangements | $	$ 27.2	$ 26.2
Unrecognized compensation expenses related to share-based payment arrangements | $	$ 141.5
Weighted-average period of recognizing unrecognized compensation expenses related to share-based compensation, in years	3 years
Performance Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value assumptions, risk-free interest rate	1.37%	0.83%
Fair value assumptions, dividend yield	0.47%	0.52%
Fair value assumptions, expected life in years	2 years 10 months 21 days	2 years 10 months 21 days
Awards requisite service period	3 years	3 years
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award	These units have requisite service periods of three years and have no dividend rights.
Period over which the company's performance is evaluated	3 years
2012 Long Term Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of remaining shares that may be issued | shares	2,899,995
Directors Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of remaining shares that may be issued | shares	21,890

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Components of Net Periodic Pension Cost (Detail) - Pension Plans, Defined Benefit - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Defined Benefit Plan Disclosure [Line Items]
Service cost, net of employee contributions	$ 6.6	$ 7.3
Interest cost	4.8	4.7
Expected return on plan assets	(8.3)	(8.1)
Amortization	3.3	2.6
Net periodic pension cost	$ 6.4	$ 6.5

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Shareholders' Investment - Additional Information (Detail) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2017 USD ($) shares
Shareholders Equity [Line Items]
Number of shares of common stock purchased | shares	1.0
Purchase of common stock | $	$ 232.3

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Changes in Accumulated Other Comprehensive Income (Loss) by Component (Detail) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2017	Mar. 31, 2016
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		$ 1,675.1
Other comprehensive income (loss) before reclassifications		6.0	$ (14.3)
Tax (provision) benefit	[1]	1.6	5.5
Other comprehensive income (loss) before reclassifications, net of taxes		7.6	(8.8)
Reclassifications		7.6	3.2
Tax provision (benefit)		(1.8)	(0.3)
Reclassifications, net of tax		5.8	2.9
Other comprehensive income (loss)		13.4	(5.9)
Ending balance		1,671.8
Derivative Instruments Designated as Cash Flow Hedges
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		(9.9)	(8.7)
Other comprehensive income (loss) before reclassifications		1.4	(15.9)
Tax (provision) benefit	[1]	1.6	5.5
Other comprehensive income (loss) before reclassifications, net of taxes		3.0	(10.4)
Reclassifications	[2]	4.3	0.6
Tax provision (benefit)		(0.7)	0.6
Reclassifications, net of tax		3.6	1.2
Other comprehensive income (loss)		6.6	(9.2)
Ending balance		(3.3)	(17.9)
Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		(116.0)	(94.2)
Other comprehensive income (loss) before reclassifications		4.6	1.6
Tax (provision) benefit	[1]	0.0	0.0
Other comprehensive income (loss) before reclassifications, net of taxes		4.6	1.6
Reclassifications		0.0	0.0
Tax provision (benefit)		0.0	0.0
Reclassifications, net of tax		0.0	0.0
Other comprehensive income (loss)		4.6	1.6
Ending balance		(111.4)	(92.6)
Benefit Plans
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		(109.6)	(105.1)
Other comprehensive income (loss) before reclassifications		0.0	0.0
Tax (provision) benefit	[1]	0.0	0.0
Other comprehensive income (loss) before reclassifications, net of taxes		0.0	0.0
Reclassifications	[3]	3.3	2.6
Tax provision (benefit)		(1.1)	(0.9)
Reclassifications, net of tax		2.2	1.7
Other comprehensive income (loss)		2.2	1.7
Ending balance		(107.4)	(103.4)
Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance		(235.5)	(208.0)
Ending balance		$ (222.1)	$ (213.9)

[1] Income taxes are not provided for foreign currency translation adjustment.

[2] See Note 5 of the notes to condensed consolidated financial statements.

[3] These components are included in the computation of net periodic pension cost. See Note 9 of the notes to condensed consolidated financial statements.

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Net Sales Based on Location of External Customer by Geographic Region (Detail) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2017	Mar. 31, 2016
Segment Reporting Information [Line Items]
Net sales		$ 938.8	$ 873.5
United States
Segment Reporting Information [Line Items]
Net sales		657.2	625.4
Europe
Segment Reporting Information [Line Items]
Net sales		103.2	104.3
Asia Pacific
Segment Reporting Information [Line Items]
Net sales	[1]	126.3	97.9
Other
Segment Reporting Information [Line Items]
Net sales	[1]	$ 52.1	$ 45.9

[1] Beginning in the fourth quarter of 2016, net sales for Asia-Pacific are separately reported. Prior year amount have been reclassified to conform to current year presentation.

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Total Net Sales by Product Group Category (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting Information [Line Items]
Net sales	$ 938.8	$ 873.5
Vascular
Segment Reporting Information [Line Items]
Net sales	256.6	239.5
Urology
Segment Reporting Information [Line Items]
Net sales	237.7	216.7
Oncology
Segment Reporting Information [Line Items]
Net sales	255.5	241.9
Surgical Specialties
Segment Reporting Information [Line Items]
Net sales	165.1	151.4
Other Product Group
Segment Reporting Information [Line Items]
Net sales	$ 23.9	$ 24.0