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Investments | 9 Months Ended
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Sep. 30, 2023
Investments, Debt and Equity Securities [Abstract] |
Investments | Investments Available-for-sale investments The amortized cost, gross unrealized gains, gross unrealized losses and fair values of interest-bearing securities, which are considered available-for-sale, by type of security were as follows (in millions):
Types of securities as of September 30, 2023 |  | Amortized cost |  | Gross unrealized gains |  | Gross unrealized losses |  | Fair values
U.S. Treasury bills |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Money market mutual funds |  | 34,208 |  |  | — |  |  | — |  |  | 34,208 |
Total interest-bearing securities |  | $ | 34,208 |  |  | $ | — |  |  | $ | — |  |  | $ | 34,208 |
Types of securities as of December 31, 2022 |  | Amortized cost |  | Gross unrealized gains |  | Gross unrealized losses |  | Fair values
U.S. Treasury bills |  | $ | 1,676 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,676 |
Money market mutual funds |  | 2,659 |  |  | — |  |  | — |  |  | 2,659 |
Total interest-bearing securities |  | $ | 4,335 |  |  | $ | — |  |  | $ | — |  |  | $ | 4,335 |
The fair values of interest-bearing securities by location in the Condensed Consolidated Balance Sheets were as follows (in millions):
Condensed Consolidated Balance Sheets locations |  | September 30, 2023 |  | December 31, 2022
Cash and cash equivalents |  | $ | 34,208 |  |  | $ | 2,659 |
Marketable securities |  | — |  |  | 1,676 |
Total interest-bearing securities |  | $ | 34,208 |  |  | $ | 4,335 |
Cash and cash equivalents in the above table excludes bank account cash of $533 million and $4,970 million as of September 30, 2023 and December 31, 2022, respectively. Cash and cash equivalents as of September 30, 2023, was $34.7 billion, a majority of which was used to acquire Horizon in October 2023. See Note 3, Acquisitions and divestitures. All interest-bearing securities as of September 30, 2023 and December 31, 2022, mature in one year or less. For the three and nine months ended September 30, 2023 and 2022, realized gains and losses on interest-bearing securities were not material. Realized gains and losses on interest-bearing securities are recorded in Other income (expense), net, in the Condensed Consolidated Statements of Income. The cost of securities sold is based on the specific-identification method. The primary objective of our investment portfolio is to maintain safety of principal, prudent levels of liquidity and acceptable levels of risk. Our investment policy limits interest-bearing security investments to certain types of debt and money market instruments issued by institutions with investment-grade credit ratings, and it places restrictions on maturities and concentration by asset class and issuer. Equity securities BeiGene, Ltd. Effective January 30, 2023, we relinquished our right to appoint a director to BeiGene’s Board of Directors. We no longer have the ability to exert significant influence over BeiGene. As a result, in the first quarter of 2023, we began to account for our ownership interest as an equity security with a readily determinable fair value, with changes in fair value recorded in Other income (expense), net. See Note 12, Fair value measurement. During the three and nine months ended September 30, 2023, we recognized unrealized gains of $30 million and $1.2 billion, respectively, recorded in Other income (expense), net, in our Condensed Consolidated Statements of Income. As of September 30, 2023, the carrying and fair value of our investment in BeiGene was $3.4 billion and was included in Other noncurrent assets in the Condensed Consolidated Balance Sheets. As of December 31, 2022, under the equity method of accounting, the carrying value of our investment in BeiGene was $2.2 billion and was included in Other noncurrent assets in the Condensed Consolidated Balance Sheets, and our ownership percentage was 18.2%. During the three and nine months ended September 30, 2022, under the equity method of accounting, our carrying value in BeiGene was adjusted by our share of BeiGene’s net losses of $104 million and $292 million, respectively, and amortization of the basis difference of $48 million and $143 million, respectively, recorded in Other income (expense), net, in our Condensed Consolidated Statements of Income. Other equity securities Excluding our equity investments in BeiGene and Neumora (discussed below), we held investments in other equity securities with readily determinable fair values (publicly traded securities) of $344 million and $480 million as of September 30, 2023 and December 31, 2022, respectively, which are included in Other noncurrent assets in the Condensed Consolidated Balance Sheets. During the three months ended September 30, 2023 and 2022, net unrealized losses and gains on these publicly traded securities were a net loss of $49 million and a net gain of $17 million, respectively. During the nine months ended September 30, 2023 and 2022, net unrealized losses on these publicly traded securities were $41 million and $259 million, respectively. Realized gains and losses on sales of publicly traded securities for the three and nine months ended September 30, 2023 and 2022, were not material. We held investments of $293 million and $233 million in equity securities without readily determinable fair values as of September 30, 2023 and December 31, 2022, respectively, which are included in Other noncurrent assets in the Condensed Consolidated Balance Sheets. During the three and nine months ended September 30, 2023, upward and downward adjustments on these securities were not material. During the three and nine months ended September 30, 2022, downward adjustments on these securities were $55 million and $64 million, respectively, and upward adjustments for these periods were not material. Adjustments were based on observable price transactions. Equity method investments Neumora Therapeutics, Inc. On September 30, 2021, we acquired an approximately 25.9% ownership interest in Neumora, a then privately held company, for $257 million, which is included in Other noncurrent assets in the Condensed Consolidated Balance Sheets, in exchange for a $100 million cash payment and $157 million in noncash consideration primarily related to future services. During the three months ended September 30, 2023, we made an additional $30 million equity investment in Neumora in connection with their initial public stock offering, and consequently, our investment now has a readily determinable fair value. Although our equity investment provides us with the ability to exercise significant influence over Neumora and therefore qualifies us for the equity method of accounting, we have elected the fair value option to account for our investment. Under the fair value option, changes in the fair value of the investment are recognized through earnings in Other income (expense), net, in our Condensed Consolidated Statements of Income each reporting period. We believe the fair value option best reflects the economics of the underlying transaction. As of September 30, 2023 and December 31, 2022, our ownership interests in Neumora were approximately 23.2% and 24.9%, respectively, and the fair values of our investment were $499 million and $335 million, respectively. During the three months ended September 30, 2023 and 2022, we recognized gains of $153 million and $240 million, respectively, and during the nine months ended September 30, 2023 and 2022, we recognized gains of $134 million and $152 million, respectively. For information on determination of fair values, see Note 12, Fair value measurement. Limited partnerships We held limited partnership investments of $238 million and $249 million as of September 30, 2023 and December 31, 2022, respectively, which are included in Other noncurrent assets in the Condensed Consolidated Balance Sheets. These investments, primarily investment funds of early-stage biotechnology companies, are accounted for by using the equity method of accounting and are measured by using our proportionate share of the net asset values of the underlying investments held by the limited partnerships as a practical expedient. These investments are typically redeemable only through distributions upon liquidation of the underlying assets. As of September 30, 2023, unfunded additional commitments to be made for these investments during the next several years amounted to $138 million. For the three months ended September 30, 2023 and 2022, net unrealized gains and losses from our limited partnership investments were an unrealized gain of $14 million and an unrealized loss of $62 million, respectively. For the nine months ended September 30, 2023 and 2022, net unrealized gains and losses from our limited partnership investments were an unrealized gain of $5 million and an unrealized loss of $282 million, respectively.

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