PFIZER INC | 2013 | FY | 3


The following table provides additional information about the intangible assets that were impaired during 2013 in Other (income)/deductions––net :
 
 
 
 
 
 
 
 
 
 
Year Ended December 31,
 
 
Fair Value(a)
 
2013
(MILLIONS OF DOLLARS)
 
Amount

 
Level 1
 
Level 2
 
Level 3
 
Impairment
Intangible assets––Developed technology rights(b)
 
$
564

 
$

 
$

 
$
564

 
$
394

Intangible assets––Indefinite-lived Brands(b)
 
1,499

 

 

 
1,499

 
109

Intangible assets––IPR&D(b)
 
218

 

 

 
218

 
227

Intangible assets––Other
 

 

 

 

 
73

Total
 
$
2,281

 
$

 
$

 
$
2,281

 
$
803

(a) 
The fair value amount is presented as of the date of impairment, as these assets are not measured at fair value on a recurring basis. See also Note 1E. Basis of Presentation and Significant Accounting Policies: Fair Value.
(b) 
Reflects intangible assets written down to their fair value in 2013. Fair value was determined using the income approach, specifically the multi-period excess earnings method, also known as the discounted cash flow method. We started with a forecast of all the expected net cash flows associated with the asset and then we applied an asset-specific discount rate to arrive at a net present value amount. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the product and the impact of technological risk associated with IPR&D assets; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows.

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