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costs of $754 million and $126 million expense for the cost associated with the DePuy ASR TM Hip program. The Pharmaceutical
segment includes an additional year of the Branded Prescription Drug Fee of $220 million and a positive adjustment of $0.1 billion to
previous reserve estimates.
(5) Includes $2,276 million of net litigation expense comprised of $1,975 million and $301 million in the Medical Devices and
Pharmaceutical segments, respectively. Includes $683 million of Synthes integration/transaction costs in the Medical Devices
segment. Includes $580 million of in-process research and development expense, comprised of $514 million and $66 million in the
Pharmaceutical and Medical Devices segments, respectively. The Medical Devices segment also includes $251 million expense for
the cost associated with the DePuy ASR TM Hip program. Includes $98 million of income related to other adjustments comprised of
$55 million and $43 million in the Consumer and Pharmaceutical segments, respectively.
(6) Long-lived assets include property, plant and equipment, net for 2015, and 2014 of $15,905 and $16,126, respectively, and
intangible assets and goodwill, net for 2015 and 2014 of $47,393 and $49,054, respectively.
19. Selected Quarterly Financial Data (unaudited)
Selected unaudited quarterly financial data for the years 2015 and 2014 are summarized below:
2015 2014
(Dollars in Millions Except Per Share
Data)
First
Quarter(1)
Second
Quarter(2)
Third
Quarter(3)
Fourth
Quarter(4)
First
Quarter(5)
Second
Quarter(6)
Third
Quarter(7)
Fourth
Quarter(8)
Segment sales to customers
Consumer $3,390 3,483 3,314 3,320 3,557 3,744 3,589 3,606
Pharmaceutical 7,726 7,946 7,694 8,064 7,498 8,509 8,307 7,999
Medical Devices 6,258 6,358 6,094 6,427 7,060 7,242 6,571 6,649
Total sales 17,374 17,787 17,102 17,811 18,115 19,495 18,467 18,254
Gross profit 12,092 12,430 11,878 12,138 12,660 13,456 13,068 12,401
Earnings before provision for taxes on
income 5,575 5,741 4,122 3,758 5,424 5,626 6,810 2,703
Net earnings 4,320 4,516 3,358 3,215 4,727 4,326 4,749 2,521
Basic net earnings per share $1.55 1.63 1.21 1.16 1.67 1.53 1.69 0.90
Diluted net earnings per share $1.53 1.61 1.20 1.15 1.64 1.51 1.66 0.89
(1) The first quarter of 2015 includes a net litigation gain of $253 million after-tax ($402 million before-tax) and $122 million after-tax
($139 million before-tax) for costs associated with the DePuy ASR™ Hip program.
(2) The second quarter of 2015 includes net litigation expense of $23 million after-tax ($134 million before-tax).
(3) The third quarter of 2015 includes net litigation expense of $348 million after-tax ( $409 million before-tax).
(4) The fourth quarter of 2015 includes a restructuring charge of $415 million after-tax ($590 million before-tax), $156 million after-tax
($214 million before-tax) from impairment of in-process research and development and Synthes integration costs of $59 million after-
tax ($83 million before-tax). Additionally, the fourth quarter of 2015 includes the gain on the Cordis divestiture.
(5) The first quarter of 2014 includes Synthes integration costs of $84 million after-tax ($118 million before-tax) and a $398 million tax
benefit associated with Conor Medsystems.
(6) The second quarter of 2014 includes litigation expense of $342 million after-tax ($276 million before-tax) and Synthes integration
costs of $104 million after-tax ($144 million before-tax).
(7) The third quarter of 2014 includes an additional year of the Branded Prescription Drug Fee of $220 million after and before tax,
litigation expense of $231 million after-tax ($285 million before-tax), Synthes integration costs of $130 million after-tax ($167 million
before-tax) and $111 million after-tax ($126 million before-tax) for costs associated with the DePuy ASR™ Hip program. Additionally,
the fiscal third quarter of 2014 includes a net gain of $1.1 billion after-tax ($1.9 billion before-tax) for the divestiture of the Ortho-
Clinical Diagnostics business.
(8) The fourth quarter of 2014 includes litigation expense, primarily related to product liability and patent litigation of $652 million after-
tax ($692 million before-tax), Synthes integration costs of $237 million after-tax ($325 million before-tax) and $115 million after-tax
($156 million before-tax) from impairment of in-process research and development.
20. Business Combinations and Divestitures
Certain businesses were acquired for $954 million in cash and $220 million of liabilities assumed during 2015. The
assumed liabilities primarily represent the fair value of the contingent consideration of $210 million. These acquisitions
were accounted for using the acquisition method and, accordingly, results of operations have been included in the
financial statements from their respective dates of acquisition.
62 •Johnson & Johnson 2015 Annual Report