AbbVie 2013 Annual Report Download - page 75

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including performance-based awards not otherwise included in the calculation of EPS under the
treasury-stock method, was excluded from the numerator for the calculation of basic and diluted
earnings per share under the two-class method. Earnings allocable to participating securities for the
year ended December 31, 2013 was $26 million.
For the year ended December 31, 2013, approximately 1 million common shares issuable under stock-
based compensation plans were excluded from the computation of earnings per common share
assuming dilution because the effect would have been antidilutive.
For periods prior to the separation, the numerator for both basic and diluted EPS was net earnings
attributable to AbbVie. The denominator for basic and diluted EPS was calculated using the
1,577 million AbbVie common shares outstanding immediately following the separation. The same
number of shares was used to calculate basic and diluted earnings per share since no AbbVie equity
awards were outstanding prior to the separation.
Note 5 Acquisitions, Collaborations and Other Arrangements
In 2013, 2012 and 2011, cash outflows related to collaborations, the acquisition of product rights and
other arrangements totaled $405 million, $688 million and $273 million, respectively. AbbVie recorded
IPR&D charges of $338 million, $288 million and $673 million in 2013, 2012 and 2011, respectively.
Significant arrangements impacting 2013, 2012 and 2011, some of which require contingent milestone
payments, include the following:
Collaborations and Other Arrangements
Ablynx NV
In September 2013, AbbVie entered into a global collaboration agreement with Ablynx NV to develop
and commercialize the anti-IL-6R Nanobody, ALX-0061, to treat inflammatory diseases including
rheumatoid arthritis and systemic lupus erythematosus, resulting in a charge to IPR&D of $175 million.
Upon the achievement of certain development, regulatory and commercial milestones, AbbVie could
make additional payments of up to $665 million, as well as royalties on net sales.
Galapagos NV
In September 2013, AbbVie recorded a charge to IPR&D of $45 million as a result of entering into a
global collaboration with Galapagos NV (Galapagos) to discover, develop and commercialize cystic
fibrosis therapies. Upon the achievement of certain development, regulatory and commercial
milestones, AbbVie could make additional payments of up to $360 million, as well as royalties on net
sales.
In February 2012, AbbVie recorded a charge to IPR&D of $150 million as a result of entering into a
global collaboration with Galapagos to develop and commercialize a next-generation, oral Janus
Kinase 1 (JAK1) inhibitor in Phase II development with the potential to treat multiple autoimmune
diseases. Additional payments of approximately $1.3 billion could be required for the achievement of
certain development, regulatory and commercial milestones under this agreement.
Alvine Pharmaceuticals, Inc.
In May 2013, AbbVie entered into a global collaboration with Alvine Pharmaceuticals, Inc. to develop
ALV003, a novel oral treatment for patients with celiac disease. As part of the agreement, AbbVie
made an initial upfront payment of $70 million, which was expensed to IPR&D in the second quarter
of 2013. AbbVie could make additional payments totaling up to $275 million pursuant to this
arrangement.
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