Intangible Assets and Goodwill

9 Months Ended

Oct. 01, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS AND GOODWILL

Intangible assets that have finite useful lives are amortized over their estimated useful lives. The latest annual impairment assessment of goodwill and indefinite lived intangible assets was completed in the fiscal fourth quarter of 2022. Future impairment tests for goodwill and indefinite lived intangible assets will be performed annually in the fiscal fourth quarter, or sooner, if warranted.


(Dollars in Millions)	October 1, 2023		January 1, 2023
Intangible assets with definite lives:
Patents and trademarks — gross	$	39,284	39,388
Less accumulated amortization	(23,052)		(20,616)
Patents and trademarks — net	16,232		18,772
Customer relationships and other intangibles — gross	19,844		19,764
Less accumulated amortization	(12,159)		(11,363)
Customer relationships and other intangibles — net(1)	7,685		8,401
Intangible assets with indefinite lives:
Trademarks	1,640		1,630
Purchased in-process research and development	9,464		9,686
Total intangible assets with indefinite lives	11,104		11,316
Total intangible assets — net	$	35,021	38,489

(1)The majority is comprised of customer relationships

Goodwill as of October 1, 2023 was allocated by segment of business as follows:


(Dollars in Millions)	Innovative Medicine		MedTech		Total
Goodwill at January 1, 2023	$	10,184	25,863		36,047
Goodwill, related to acquisitions	—		—		—
Goodwill, related to divestitures	—		—		—
Currency translation/Other	(35)		112	*	77
Goodwill at October 1, 2023	$	10,149	25,975		36,124

*Includes purchase price allocation adjustment for Abiomed

The weighted average amortization period for patents and trademarks is 11 years. The weighted average amortization period for customer relationships and other intangible assets is 18 years. The amortization expense of amortizable intangible assets for continuing operations included in cost of products sold was $1.1 billion and $1.0 billion for the fiscal third quarters ended October 1, 2023 and October 2, 2022, respectively. The amortization expense of amortizable intangible assets for continuing operations included in cost of products sold was $3.4 billion and $3.0 billion for the fiscal nine months ended October 1, 2023 and October 2, 2022, respectively. Intangible asset write-downs are included in Other (income) expense, net, with the exception of In-Process research and development which are included in the In-Process research and development impairments line.

The estimated amortization expense for approved products from continuing operations, before tax, for the five succeeding years is approximately:


(Dollars in Millions)
2023	2024	2025	2026	2027
$4,500	4,300	3,500	2,900	2,300

See Note 10 to the Consolidated Financial Statements for additional details related to acquisitions and divestitures.

See Note 12 to the Consolidated Financial Statements for additional details related to discontinued operations.