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GOODWILL AND OTHER INTANGIBLE ASSETS, NET | 12 Months Ended
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Dec. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract] |
GOODWILL AND OTHER INTANGIBLE ASSETS, NET |
GOODWILL AND OTHER INTANGIBLE ASSETS, NET
Goodwill The following is a reconciliation of goodwill by business segment.
(in millions) | Americas | EMEA | APAC | Medical Products & Therapies | Healthcare Systems & Technologies 1 | Pharmaceuticals |  | Total
December 31, 2022 | $ | 1,665 |  | $ | 78 |  | $ | 18 |  | $ | — |  | $ | 3,988 |  | $ | — |  |  | $ | 5,749 |
Currency translation and other | (19) |  | (3) |  | (2) |  | 46 |  | 1 |  | 21 |  |  | 44 |
Reallocation of goodwill | (1,646) |  | (75) |  | (16) |  | 1,195 |  | — |  | 542 |  |  | — |
December 31, 2023 | $ | — |  | $ | — |  | $ | — |  | $ | 1,241 |  | $ | 3,989 |  | $ | 563 |  |  | $ | 5,793 |
Impairment | — |  | — |  | — |  | — |  | (425) |  | — |  |  | (425) |
Currency translation and other | — |  | — |  | — |  | (56) |  | (14) |  | (23) |  |  | (93) |
December 31, 2024 | $ | — |  | $ | — |  | $ | — |  | $ | 1,185 |  | $ | 3,550 |  | $ | 540 |  |  | $ | 5,275 |
1 Prior to the third quarter of 2023, our Healthcare Systems & Technologies segment was referred to as our Hillrom segment. Change in Reportable Segments Our reportable segments were previously comprised of the following geographic segments related to our legacy Baxter business: Americas (North and South America), EMEA (Europe, Middle East and Africa) and APAC (Asia Pacific), and a global segment for our Hillrom business. In the third quarter of 2023, we completed the implementation of a new operating model intended to simplify and streamline our operations and better align our manufacturing and supply chain to our commercial activities. Our segments were changed during the third quarter of 2023 to align with our new operating model. Under this operating model, our business is comprised of three reportable segments: Medical Products & Therapies, Healthcare Systems & Technologies (formerly referred to as our Hillrom segment) and Pharmaceuticals. As a result of this segment change, we reallocated the goodwill from our previous Americas, EMEA and APAC segments to the reporting units within our Medical Products & Therapies and Pharmaceuticals segments based on the relative fair values of those reporting units. We performed goodwill impairment assessments both before and after the reporting unit change and we did not identify any goodwill impairments. Goodwill Impairment In connection with our annual goodwill impairment assessment in the fourth quarter of 2024, we recorded a $425 million goodwill impairment related to our Front Line Care reporting unit within our Healthcare Systems & Technologies segment. The reduction in value was primarily due to lower forecasted operating results and a lower terminal growth rate utilized in valuing this reporting unit which contributed to reduced expected future cash flows, as well as lower earnings multiples. The fair value of the Front Line Care reporting unit was determined based on a discounted cash flow model (an income approach) and earnings multiples (a market approach) based on the guideline public company method. Significant assumptions used in the determination of the fair values of our reporting units generally include revenue growth rates, forecasted EBITDA margins, discount rates, terminal growth rates and earnings multiples. The discounted cash flow model used to determine the fair value of our Front Line Care reporting unit reflected our most recent cash flow projections, a discount rate of 9.5% and a terminal growth rate of 3.25%. Our reporting unit fair value measurements are classified as Level 3 in the fair value hierarchy because they involve significant unobservable inputs. As of December 31, 2024, the carrying amount of goodwill for our Front Line Care reporting unit was $1.99 billion. No goodwill impairments were recorded for our remaining reporting units in connection with our annual goodwill impairment tests because the fair values of those reporting units exceeded their carrying amounts. Other Intangible Assets, Net The following is a summary of our other intangible assets.
|  |  |  |  | Indefinite-lived intangible assets |
(in millions) | Customer relationships | Developed technology, including patents | Trade Names | Other amortized intangible assets | Trade Names | In process Research and Development | Total
December 31, 2023 |  |  |  |  |  |  |
Gross other intangible assets | $ | 3,390 |  | $ | 3,181 |  | $ | 964 |  | $ | 86 |  | $ | 680 |  | $ | 157 |  | $ | 8,458 |
Accumulated amortization | (654) |  | (1,782) |  | (38) |  | (66) |  | — |  | — |  | $ | (2,540) |
Other intangible assets, net | $ | 2,736 |  | $ | 1,399 |  | $ | 926 |  | $ | 20 |  | $ | 680 |  | $ | 157 |  | $ | 5,918 |
December 31, 2024 |  |  |  |  |  |  |
Gross other intangible assets | $ | 3,387 |  | $ | 3,131 |  | $ | 958 |  | $ | 86 |  | $ | 680 |  | $ | 107 |  | $ | 8,349 |
Accumulated amortization | (878) |  | (2,075) |  | (107) |  | (66) |  | — |  | — |  | (3,126) |
Other intangible assets, net | $ | 2,509 |  | $ | 1,056 |  | $ | 851 |  | $ | 20 |  | $ | 680 |  | $ | 107 |  | $ | 5,223 |
Intangible asset amortization expense was $625 million in 2024, $590 million in 2023 and $679 million in 2022. The anticipated annual amortization expense for definite-lived intangible assets recorded as of December 31, 2024 is $586 million in 2025, $562 million in 2026, $412 million in 2027, $400 million in 2028 and $378 million in 2029. During the fourth quarter of 2023, as a result of an update to our long-term branding strategy, we reclassified two trade name intangible assets with carrying amounts of $870 million and $21 million from indefinite-lived intangible assets to amortizing intangible assets. The estimated useful lives assigned to those assets were 15 years and 5 years, respectively. We performed impairment tests of those intangible assets at the time of the reclassification and determined that no impairment had occurred. Intangible Asset Impairments Impairment of Indefinite-Lived Intangible Assets from Our Claris Acquisition In connection with our annual IPR&D impairment assessment in the fourth quarter of 2024, we recognized a pre-tax impairment charge of $50 million to reduce the carrying amount of an IPR&D asset to its fair value. The reduction in value was primarily due to lower forecasted revenues and margins which contributed to reduced expected future cash flows. The intangible asset impairment charge is classified within research and development expenses in the accompanying consolidated statements of income (loss) for the year ended December 31, 2024. The fair value of the IPR&D asset was determined using the multi-period excess earnings method. Significant assumptions used in the determination of the fair value of the IPR&D asset included forecasted cash flows and the discount rate. The multi-period excess earnings model used in our determination of the fair value of the IPR&D asset reflected our most recent cash flow projections and a discount rate of 11%. Our IPR&D intangible asset fair value measurement is classified as Level 3 in the fair value hierarchy because it involves significant unobservable inputs.

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-30/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-20/tableOfContent + Details
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