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Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2024

Summary of Financial Items Carried at Fair Value

Financial items carried at fair value on a recurring basis as of September 30, 2024 and December 31, 2023 are classified in the tables below in one of the three categories of fair value levels:

		September 30, 2024
		Level 1				Level 2				Level 3				Total
		(U.S. $ in millions)
Cash and cash equivalents:
Money markets		$	1,822			$	—			$	—			$	1,822
Cash, deposits and other			1,497				—				—				1,497
Investment in securities:
Equity securities			13				—				—				13
Other			3				—				—				3
Derivatives:
Asset derivatives:
Options and forward contracts			—				32				—				32
Liability derivatives:
Options and forward contracts			—				(33	)			—				(33	)
Bifurcated embedded derivatives			—				—			§					—
Contingent consideration*			—				—				(552	)			(552	)
Total		$	3,335			$	(1	)		$	(552	)		$	2,782

		December 31, 2023
		Level 1				Level 2				Level 3				Total
		(U.S. $ in millions)
Cash and cash equivalents:
Money markets		$	1,704			$	—			$	—			$	1,704
Cash, deposits and other			1,522				—				—				1,522
Investment in securities:
Investment in convertible bond security											40				40
Equity securities			7				—				—				7
Other			1				—				—				1
Restricted cash			1				—				—				1
Derivatives:
Asset derivatives:
Options and forward contracts			—				38				—				38
Cross-currency interest rate swap							8								8
Liability derivatives:
Options and forward contracts			—				(39	)			—				(39	)
Bifurcated embedded derivatives			—				—			§					—
Contingent consideration*		$	—				—				(517	)			(517	)
Total			3,235			$	7			$	(477	)		$	2,765

§ Represents an amount less than $0.5 million.

* Contingent consideration represents liabilities recorded at fair value in connection with acquisitions.

Summary of Fair Value of Financial Liabilities Measured Using Level 3 Inputs

The following table summarizes the activity for the financial assets and liabilities where fair value measurements are estimated utilizing Level 3 inputs:

		Nine months ended September 30, 2024				Nine months ended September 30, 2023
		(U.S. $ in millions)
Fair value at the beginning of the period		$	(477	)			(250	)
Investment in convertible bond**			—				25
Conversion option**			—				15
Redemption of convertible bond security**			(40	)			—
Bifurcated embedded derivatives		§				§
Adjustments to provisions for contingent consideration:
Allergan transaction*			(267	)			(111	)
Eagle transaction			(37	)			(35	)
Novetide transaction			(1	)			2
Settlement of contingent consideration:
Allergan transaction			227				132
Eagle transaction			41				61
Novetide transaction			2				2
Fair value at the end of the period		$	(552	)		$	(159	)

§ Represents an amount less than $0.5 million.

* The financial data presented in the tables above with respect to adjustments to provisions for contingent consideration related to Allergan for the nine months ended September 30, 2023 have been revised as discussed in note 1c.

** On September 29, 2023, Teva purchased $40 million of subordinated convertible bonds of Alvotech. On June 26, 2024, Alvotech announced its intention to exercise its redemption rights and redeemed the convertible bonds, which were paid to Teva in July 2024 (see note 2).

Summary of Financial Instrument Measured on a Basis Other Than Fair Value

Financial instruments measured on a basis other than fair value mostly consist of senior notes, sustainability-linked senior notes and convertible senior debentures (see note 7) and are presented in the table below in terms of fair value (level 1 inputs):

		Estimated fair value*
		September 30, 2024				December 31, 2023
		(U.S. $ in millions)
Senior notes and sustainability-linked senior notes included under senior notes and loans		$	16,129			$	17,214
Senior notes and convertible senior debentures included under short-term debt			2,572				1,651
Total		$	18,701			$	18,865

* The fair value was estimated based on quoted market prices.

X

- Definition

Tabular disclosure of assets measured at fair value measured on a recurring or nonrecurring basis. Includes, but is not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
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-Publisher FASB
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X

- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-3

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-2

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
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Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
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-Publisher FASB
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