Pfizer 2010 Annual Report Download - page 84

Notes to Consolidated Financial Statements
Pfizer Inc. and Subsidiary Companies
B. Other Intangible Assets
The components of identifiable intangible assets, primarily included in our Biopharmaceutical segment, follow:
AS OF DECEMBER 31,
2010 2009
(MILLIONS OF DOLLARS)
GROSS
CARRYING
AMOUNT
ACCUMULATED
AMORTIZATION
IDENTIFIABLE
INTANGIBLE
ASSETS, LESS
ACCUMULATED
AMORTIZATION
GROSS
CARRYING
AMOUNT
ACCUMULATED
AMORTIZATION
IDENTIFIABLE
INTANGIBLE
ASSETS, LESS
ACCUMULATED
AMORTIZATION
Finite-lived intangible assets(a):
Developed technology rights $68,432 $(26,223) $42,209 $68,870 $(21,223) $47,647
Brands 1,626 (607) 1,019 1,637 (535) 1,102
License agreements 637 (248) 389 622 (119) 503
Trademarks 107 (74) 33 113 (73) 40
Other 429 (250) 179 488 (231) 257
Total amortized finite-lived
intangible assets 71,231 (27,402) 43,829 71,730 (22,181) 49,549
Indefinite-lived intangible assets:
Brands(b) 10,219 — 10,219 12,562 — 12,562
In-process research and
development(b) 3,438 — 3,438 5,834 — 5,834
Trademarks 72 — 72 70 — 70
Total indefinite-lived intangible
assets 13,729 — 13,729 18,466 — 18,466
Total identifiable intangible assets $84,960 $(27,402) $57,558 $90,196 $(22,181) $68,015
(a) The decrease in total Finite-lived intangible assets is primarily related to amortization, the impact of measurement period adjustments (see Note 2.
Acquisition of Wyeth), asset impairment charges (see Note 3B. Other Significant Transactions and Events: Asset Impairment Charges and Note 6.
Other (Income)/Deductions––Net) and the impact of foreign exchange.
(b) The decrease in Indefinite-lived Brands and IPR&D assets reflects the impact of measurement period adjustments (see Note 2. Acquisition of
Wyeth) and asset impairment charges (see Note 3B. Other Significant Transactions and Events: Asset Impairment Charges and Note 6. Other
(Income)/Deductions––Net). For IPR&D assets, the decrease was partially offset by the addition of the IPR&D asset acquired as part of our
acquisition of FoldRx (Note 3D. Other Significant Transactions and Events: Acquisitions).
All of these assets are subject to our review for impairment, as explained in Note 1L. Significant Accounting Policies: Amortization of
Intangible Assets, Depreciation and Certain Long-Lived Assets. For additional information on intangible asset impairments recorded
in 2010 and 2009, see Note 3B. Other Significant Transactions and Events: Asset Impairment Charges and Note 6. Other (Income)/
Deductions––Net.
Developed Technology Rights
Developed technology rights represent the amortized cost associated with developed technology, which has been acquired from
third parties and which can include the right to develop, use, market, sell and/or offer for sale the product, compounds and
intellectual property that we have acquired with respect to products, compounds and/or processes that have been completed. We
possess a well-diversified portfolio of hundreds of developed technology rights across therapeutic categories, primarily representing
the commercialized products included in our Biopharmaceutical segment. Virtually all of these assets were acquired in connection
with our Wyeth acquisition in 2009 and our Pharmacia acquisition in 2003. The more significant components of developed
technology rights are the following (in order of significance): Enbrel and Prevnar/Prevenar 13 Infant and, to a lesser extent,
Premarin, Celebrex, Effexor, Pristiq, Tygacil, BMP-2, BeneFIX, Refacto and Genotropin.
Also included in this category are the post-approval milestone payments made under our alliance agreements for certain
Biopharmaceutical products, such as Rebif and Spiriva.
Brands
Brands represent the amortized or unamortized cost associated with tradenames and know-how, as the products themselves do not
receive patent protection. Most of these assets are associated with our Diversified segment. Virtually all of these assets were
acquired in connection with our Wyeth acquisition in 2009 and our Pharmacia acquisition in 2003. The more significant components
of indefinite-lived brands are the following (in order of significance): Advil, Xanax, Centrum, Medrol, 1st Age Nutrition and 2nd Age
Nutrition. The more significant components of finite-lived brands are the following (in order of significance): Depo-Provera, Advil
Cold and Sinus, and Dimetapp.
In-Process Research and Development
IPR&D assets represent research and development assets that have not yet received regulatory approval and are required to be
classified as indefinite-lived assets until the successful completion or the abandonment of the associated research and development
effort. Accordingly, during the development period after the date of acquisition, these assets will not be amortized until approval is
obtained in a major market, typically either the U.S. or the EU, or in a series of other countries, subject to certain specified conditions
and management judgment. At that time, we will determine the useful life of the asset, reclassify the asset out of in-process research
and development and begin amortization. In 2009, Prevnar/Prevenar 13 Infant received regulatory approval in a major market, and
as a result, we reclassified the asset from IPR&D to Developed Technology Rights and began to amortize the asset.
82 2010 Financial Report