The following table provides the components of Income from continuing operations before provision for taxes on income: | ||||||||||||
Year Ended December 31, | ||||||||||||
(MILLIONS OF DOLLARS) | 2013 | 2012 | 2011 | |||||||||
United States | $ | (1,678 | ) | $ | (5,148 | ) | $ | (2,655 | ) | |||
International | 17,394 | 16,390 | 14,136 | |||||||||
Income from continuing operations before provision for taxes on income(a), (b) | $ | 15,716 | $ | 11,242 | $ | 11,481 | ||||||
(a) | 2013 v. 2012––The decrease in the domestic loss was primarily due to income from a litigation settlement in the second quarter of 2013 with Teva and Sun for patent-infringement damages resulting from their “at-risk” launches of generic Protonix in the U.S., lower charges related to other legal matters, lower restructuring charges and other costs associated with acquisitions and cost-reduction/productivity initiatives, partially offset by lower revenues. The increase in international income is primarily related to the gain associated with the transfer of certain product rights to Pfizer’s equity-method investment in China (Hisun Pfizer) in 2013, lower charges related to other legal matters, lower restructuring charges and other costs associated with acquisitions and cost-reduction/productivity Initiatives and lower amortization of intangible assets, partially offset by lower revenues and higher asset impairments and related charges. For additional information about the litigation settlement with Teva and Sun, see Note 17A5. Commitments and Contingencies: Legal Proceedings––Certain Matters Resolved During 2013. For additional information about Hisun Pfizer, see Note 2D. Acquisitions, Divestitures, Collaborative Arrangements and Equity-Method Investments: Equity-Method Investments. |
(b) | 2012 v. 2011––The increase in the domestic loss was primarily due to the reduction in revenues resulting from the loss of exclusivity of Lipitor, Geodon and certain other biopharmaceutical products; certain legal settlements and related charges, primarily associated with Rapamune, Celebrex, hormone-replacement therapy and Chantix; higher costs associated with the separation of Zoetis; and the payment to AstraZeneca to obtain the exclusive global OTC rights to Nexium, partially offset by lower acquisition-related costs. The increase in international income was due to lower amortization of intangible assets and charges resulting from fair value adjustments to inventory sold during the period, lower restructuring charges and other costs associated with acquisitions and cost-reduction/productivity initiatives, partially offset by the reduction in revenues resulting from the loss of exclusivity of Lipitor, Geodon and certain other biopharmaceutical products. |
The following table provides the components of Provision for taxes on income based on the location of the taxing authorities: | ||||||||||||
Year Ended December 31, | ||||||||||||
(MILLIONS OF DOLLARS) | 2013 | 2012 | 2011 | |||||||||
United States | ||||||||||||
Current income taxes: | ||||||||||||
Federal | $ | 142 | $ | (941 | ) | $ | 1,162 | |||||
State and local | (106 | ) | (54 | ) | 177 | |||||||
Deferred income taxes: | ||||||||||||
Federal | 2,124 | 869 | 380 | |||||||||
State and local | (33 | ) | (339 | ) | (232 | ) | ||||||
Total U.S. tax provision/(benefit) | 2,127 | (465 | ) | 1,487 | ||||||||
International | ||||||||||||
Current income taxes | 2,544 | 2,430 | 2,046 | |||||||||
Deferred income taxes | (365 | ) | 256 | 88 | ||||||||
Total international tax provision | 2,179 | 2,686 | 2,134 | |||||||||
Provision for taxes on income | $ | 4,306 | $ | 2,221 | $ | 3,621 | ||||||