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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
Form 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 2000 Commission file number 1-4802
Becton, Dickinson and Company
(Exact name of registrant as specified in its charter)
New Jersey 22-0760120
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1 Becton Drive
Franklin Lakes, New Jersey 07417-1880
(Address of principal executive offices) (Zip code)
(201) 847-6800
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO
SECTION 12(b) OF THE ACT:
Name of each exchange on
Title of each class which registered
-------------------------------- --------------------------
Common Stock, Par Value $1.00 New York Stock Exchange
Preferred Stock Purchase Rights New York Stock Exchange
SECURITIES REGISTERED PURSUANT TO
SECTION 12(g) OF THE ACT:
None
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [_]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]
As of November 30, 2000, 254,803,900 shares of the registrant's common stock
were outstanding and the aggregate market value of such common stock held by
nonaffiliates of the registrant was approximately $8,635,443,522.
DOCUMENTS INCORPORATED BY REFERENCE
(1) Portions of the registrant's Annual Report to Shareholders for the fiscal
year ended September 30, 2000 are incorporated by reference into Parts I and II
hereof.
(2) Portions of the registrant's Proxy Statement for the Annual Meeting of
Shareholders to be held February 13, 2001 are incorporated by reference into
Part III hereof.
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PART I
Item 1. Business.
General
Becton, Dickinson and Company was incorporated under the laws of the State
of New Jersey in November 1906, as successor to a New York business started in
1897. Its executive offices are located at 1 Becton Drive, Franklin Lakes, New
Jersey 07417-1880 and its telephone number is (201) 847-6800. All references
herein to "BD" refer to Becton, Dickinson and Company and its domestic and
foreign subsidiaries unless otherwise indicated by the context.
BD is engaged principally in the manufacture and sale of a broad range of
supplies, devices and systems used by healthcare professionals, medical research
institutions and the general public.
Business Segments
BD's operations consist of three worldwide business segments: Medical
Systems, Biosciences, and Preanalytical Solutions. In June 2000, the Company
initiated a plan to change the structure of its internal organization in a
manner that, beginning October 1, 2000, will cause the composition of the
reportable segments to change. During the first quarter of fiscal 2001,
execution of the planned changes will be finalized so that for the quarter
ending December 31, 2000, decisions about resource allocations and performance
assessment will be made separately for the reorganized Medical and Biosciences
segments, and the new Clinical Laboratory Solutions segment. Information with
respect to BD's business segments appears on page 47 of BD's Annual Report to
Shareholders for the fiscal year ended September 30, 2000 (the "2000 Annual
Report"), and is incorporated herein by reference as part of Exhibit 13.
Medical Systems
The major products in this segment are hypodermic products, specially
designed devices for diabetes care, prefillable drug delivery systems and
infusion therapy products. This segment also includes anesthesia and surgical
products, ophthalmic surgery devices, critical care systems, elastic support
products and thermometers.
Biosciences
The major products in this segment are clinical and industrial microbiology
products, cellular analysis systems, research and clinical reagents for cellular
and nucleic acid analysis, cell culture labware, and growth media, hematology
instruments and other diagnostic systems, including immunodiagnostic test kits.
Preanalytical Solutions
The major products in this segment are specimen collection products and
services, including specimen management systems. This segment also includes
consulting services and customized, automated bar-code systems for patient
identification and point-of-care data capture.
Foreign Operations
BD's products are manufactured and sold worldwide. The principal markets
for BD's products outside the United States are Europe, Japan, Mexico, Asia
Pacific, Canada and Brazil. The principal products sold by BD outside of the
United States are hypodermic needles and syringes, diagnostic systems,
VACUTAINER(R) brand blood collection products, HYPAK(R) brand prefillable
syringe systems, and infusion therapy products. BD has manufacturing operations
outside the United States in Brazil, China, France, Germany, India, Ireland,
Japan, Korea, Mexico, Pakistan, Singapore, Spain, Sweden and the United Kingdom.
Information with respect to BD's geographic areas appears on page 48 of the 2000
Annual Report, and is incorporated herein by reference as part of Exhibit 13.
Foreign economic conditions and exchange rate fluctuations have caused the
profitability from foreign revenues to fluctuate more than the profitability
from domestic revenues. BD believes its activities in some countries outside of
the United States involve greater risk than its domestic business due to the
foregoing factors, as well as local commercial and economic policies and
political uncertainties.
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Revenues and Distribution
BD's products and services are marketed in the United States and
internationally through sales representatives and independent distribution
channels, and directly to end-users. Sales to a distributor, which supplies BD
products from all business segments to many end-users, accounted for
approximately 10% of total BD revenues in fiscal 2000. Order backlog is not
material to BD's business inasmuch as orders for BD products generally are
received and filled on a current basis, except for items temporarily out of
stock. Substantially all revenue is recognized when products are shipped to
customers.
Research and Development
BD conducts its research and development activities at its operating units,
at Becton Dickinson Technologies in Research Triangle Park, North Carolina, and
in collaboration with selected universities, medical centers and other entities.
BD also retains individual consultants to support its efforts in specialized
fields. BD spent $223,782,000 on research and development during the fiscal year
ended September 30, 2000, and $254,016,000 and $217,900,000, respectively,
during the two immediately preceding fiscal years. Research and development
spending in fiscal years 1999 and 1998 included the write-off of in-process
research and development from acquisitions of $48,800,000 and $30,000,000,
respectively. Information with respect to BD's write-off of in-process research
and development from acquisitions appears on page 33 of the 2000 Annual Report,
and is incorporated herein by reference as part of Exhibit 13.
Competition
A number of companies, some of which are more specialized than BD, compete
in the medical technology field. In each such case, competition involves only a
part of BD's product lines. Competition in BD's markets is based on a
combination of factors, including price, quality, service, reputation,
distribution and promotion. Ongoing investments in research, quality management,
quality improvement, product innovation and productivity improvement are
required to maintain an advantage in the competitive environments in which BD
operates.
New companies have entered the medical technology field and established
companies have diversified their business activities into this area. Other firms
engaged in the distribution of medical technology products have become
manufacturers as well. Some of BD's competitors have greater financial resources
than BD. BD also is faced with competition from products manufactured outside
the United States.
Intellectual Property and Licenses
BD owns significant intellectual property, including patents, patent
applications, technology, trade secrets, know-how, copyrights and trademarks in
the United States and other countries. BD is also licensed under domestic and
foreign patents, patent applications, technology, trade secrets, know-how,
copyrights and trademarks owned by others. In the aggregate, these intellectual
property assets and licenses are of material importance to BD's business. BD
does not believe, however, that any single patent, technology, trademark,
intellectual property asset or license is material in relation to BD's business
as a whole.
Raw Materials
BD purchases many different types of raw materials, including plastics,
glass, metals, yarn and yarn goods, paper products, agricultural products,
electronic and mechanical sub-assemblies and various biological, chemical and
petrochemical products. All but a few of BD's principal raw materials are
available from multiple sources.
Regulation
BD's medical technology products and operations are subject to regulation
by the federal Food and Drug Administration and various other federal and state
agencies, as well as by a number of foreign governmental agencies. BD believes
it is in compliance in all material respects with the regulations promulgated by
such agencies, and that such compliance has not had, and is not expected to
have, a material adverse effect on its business.
BD also believes that its operations comply in all material respects with
applicable environmental laws and regulations. Such compliance has not had, and
is not expected to have, a material adverse effect on BD's capital expenditures,
earnings or competitive position.
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Employees
As of September 30, 2000, BD had approximately 25,000 employees, of whom
approximately 12,200 were employed in the United States. BD believes that its
employee relations are satisfactory.
CAUTIONARY STATEMENT PURSUANT TO PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995 -- "SAFE HARBOR" FOR FORWARD-LOOKING STATEMENTS
The Private Securities Litigation Reform Act of 1995 (the "Act") provides a
safe harbor for forward-looking statements made by or on behalf of BD. BD and
its representatives may from time to time make certain forward-looking
statements in publicly-released materials, both written and oral, including
statements contained in this report and filings with the Securities and Exchange
Commission and in our other reports to shareowners. Forward-looking statements
may be identified by the use of words like "plan," "expect," "believe,"
"intend," "will," "anticipate," "estimate" and other words of similar meaning in
conjunction with, among other things, discussions of future operations and
financial performance, as well as our strategy for growth, product development,
regulatory approvals, market position and expenditures. All statements which
address operating performance or events or developments that we expect or
anticipate will occur in the future -- including statements relating to volume
growth, sales and earnings per share growth and statements expressing views
about future operating results - are forward-looking statements within the
meaning of the Act.
Forward-looking statements are based on current expectations of future
events. The forward-looking statements are and will be based on management's
then current views and assumptions regarding future events and operating
performance, and speak only as of their dates. Investors should realize that if
underlying assumptions prove inaccurate or unknown risks or uncertainties
materialize, actual results could vary materially from our expectations and
projections. Investors are therefore cautioned not to place undue reliance on
any forward-looking statements. Furthermore, we undertake no obligation to
update or revise any forward-looking statements whether as a result of new
information, future events and developments or otherwise.
The following are some important factors that could cause our actual results
to differ from our expectations in any forward-looking statements:
. Regional, national and foreign economic factors, including inflation and
fluctuations in interest rates and foreign currency exchange rates and the
potential effect of such fluctuations on revenues, expenses and resulting
margins.
. Competitive product and pricing pressures and our ability to gain or
maintain market share in the global market as a result of actions by
competitors, including technological advances achieved and patents attained
by competitors as patents on our products expire. While we believe our
opportunities for sustained, profitable growth are considerable, actions of
competitors could impact our earnings, share of sales and volume growth.
. Changes in domestic and foreign healthcare resulting in pricing pressures,
including the continued consolidation among healthcare providers, trends
toward managed care and healthcare cost containment and government laws
and regulations relating to sales and promotion, reimbursement and pricing
generally.
. Fluctuations in the cost and availability of raw materials and the ability
to maintain favorable supplier arrangements and relationships.
. Government laws and regulations affecting domestic and foreign operations,
including those relating to trade, monetary and fiscal policies, taxation,
environmental matters, price controls, licensing and regulatory approval of
new products.
. Difficulties inherent in product development, including the potential
inability to successfully continue technological innovation, complete
clinical trials, obtain regulatory approvals in the United States and
abroad, or gain and maintain market approval of products, and the
possibility of encountering infringement claims by competitors with respect
to patent or other intellectual property rights, all of which can preclude
or delay commercialization of a product.
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. Significant litigation adverse to BD, including product liability claims,
patent infringement claims, and antitrust claims, as well as other risks
and uncertainties detailed from time to time in our Securities and Exchange
Commission filings.
. Our ability to achieve earnings forecasts, which are generated based on
projected volumes and sales of many product types, some of which are more
profitable than others. There can be no assurance that we will achieve a
projected level or mix of product sales.
. Product efficacy or safety concerns resulting in product recalls,
regulatory action on the part of the Federal Drug Administration (or
foreign counterparts) or declining sales.
. Economic and political conditions in international markets, including civil
unrest, governmental changes and restrictions on the ability to transfer
capital across borders.
. Our ability to penetrate developing and emerging markets, which also
depends on economic and political conditions, and how well we are able to
acquire or form strategic business alliances with local companies and make
necessary infrastructure enhancements to production facilities,
distribution networks, sales equipment and technology.
. The impact of business combinations, including acquisitions and
divestitures, both internally for BD and externally in the healthcare
industry.
. Issuance of new or revised accounting standards by the American Institute
of Certified Public Accountants, the Financial Accounting Standards Board
or the Securities and Exchange Commission.
The foregoing list sets forth many, but not all, of the factors that could
impact our ability to achieve results described in any forward-looking
statements. Investors should understand that it is not possible to predict or
identify all such factors and should not consider this list to be a complete
statement of all potential risks and uncertainties.
Item 2. Properties.
BD's executive offices are located in Franklin Lakes, New Jersey. BD owns
and leases approximately 13,320,000 square feet of manufacturing, warehousing,
administrative and research facilities throughout the world. The domestic
facilities, including Puerto Rico, comprise approximately 5,453,500 square feet
of owned and 2,130,200 square feet of leased space. The foreign facilities
comprise approximately 3,557,600 square feet of owned and 2,178,700 square feet
of leased space. Sales offices and distribution centers included in the total
square footage are also located throughout the world.
Operations in each of BD's business segments are conducted at both domestic
and foreign locations. Particularly in the international marketplace, facilities
often serve more than one business segment and are used for multiple purposes,
such as administrative/sales, manufacturing and/or warehousing/distribution. BD
generally seeks to own its manufacturing facilities, although some are leased.
Most of BD's administrative, sales and warehousing/distribution facilities are
leased.
BD believes that its facilities are of good construction and in good
physical condition, are suitable and adequate for the operations conducted at
those facilities, and are, with minor exceptions, fully utilized and operating
at normal capacity.
The domestic facilities include facilities in Arizona, California,
Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Kentucky, Maryland,
Massachusetts, Michigan, Missouri, Nebraska, New Jersey, New York, North
Carolina, Ohio, South Carolina, Tennessee, Texas, Utah, Virginia, Wisconsin and
Puerto Rico.
The foreign facilities are grouped as follows:
--Canada includes approximately 105,900 square feet of leased space.
--Europe and Eastern Europe, Middle East and Africa include facilities
in Austria, Belgium, the Czech Republic, Denmark, Egypt, England,
Finland, France, Germany, Greece, Hungary, Ireland, Italy, Ivory
Coast, Kenya, the Netherlands, Poland, Russia, South Africa, Spain,
Sweden, Switzerland, Turkey and
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the United Arab Emirates, and are comprised of approximately
1,726,900 square feet of owned and 935,300 square feet of leased
space.
--Latin America includes facilities in Argentina, Bolivia, Brazil,
Chile, Colombia, Guatemala, Mexico, Panama, Paraguay, Peru, Uruguay
and Venezuela, and is comprised of approximately 775,500 square feet
of owned and 730,700 square feet of leased space.
--Asia Pacific includes facilities in Australia, China, Hong Kong,
India, Indonesia, Japan, Malaysia, New Zealand, Pakistan, the
Philippines, Singapore, South Korea, Taiwan, Thailand and Vietnam,
and is comprised of approximately 1,054,900 square feet of owned and
407,000 square feet of leased space.
The table below summarizes property information by business segment:
<TABLE>
<CAPTION>
Medical Preanalytical
Category Corporate Biosciences Systems Solutions Mixed(A) Total
--------------------------------------- --------- ----------- --------- ------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Leased
Facilities........................... 3 22 137 9 15 186
Square feet.......................... 45,055 489,437 2,152,328 187,663 1,434,396 4,308,879
Manufacturing facilities............. 0 5 11 4 1 21
Manufacturing square footage......... 0 94,318 353,429 60,978 8,640 517,365
Owned
Facilities........................... 4 5 27 18 10 64
Square feet.......................... 431,260 613,203 4,104,332 2,027,609 1,834,739 9,011,143
Manufacturing facilities............. 0 5 24 14 5 48
Manufacturing square footage......... 0 265,133 2,456,985 1,148,263 545,585 4,415,966
Total
Facilities........................... 7 27 164 27 25 250
Square feet.......................... 476,315 1,102,640 6,256,660 2,215,272 3,269,135 13,320,022
Manufacturing facilities............. 0 10 35 18 6 69
Manufacturing square footage......... 0 359,451 2,810,414 1,209,241 554,225 4,933,331
</TABLE>
_________________
(A) Facilities used by all business segments.
Item 3. Legal Proceedings.
BD, along with a number of other manufacturers, has been named as a
defendant in approximately 415 product liability lawsuits related to natural
rubber latex that have been filed in various state and Federal courts. Cases
pending in Federal Court are being coordinated under the matter In re Latex
Gloves Products Liability Litigation (MDL Docket No. 1148) in Philadelphia, and
analogous procedures have been implemented in the state courts of California,
Pennsylvania, New Jersey and New York. Generally, these actions allege that
medical personnel have suffered allergic reactions ranging from skin irritation
to anaphylaxis as a result of exposure to medical gloves containing natural
rubber latex. In 1986, we acquired a business which manufactured, among other
things, latex surgical gloves. In 1995, we divested this glove business. We are
vigorously defending these lawsuits.
We, along with another manufacturer and several medical product
distributors, have been named as a defendant in eleven product liability
lawsuits relating to healthcare workers who allegedly sustained accidental
needlesticks, but have not become infected with any disease.
. The case brought in California under the caption Chavez vs. Becton
Dickinson (Case No. 722978, San Diego County Superior Court), filed on
August 4, 1998 was dismissed in a judgment filed March 19, 1999. On August
29, 2000, the appellate court affirmed the dismissal of the product
liability claims, leaving only a pending statutory claim for which the
court has stated the plaintiff cannot recover damages.
. The case brought in Florida under the caption Delgado vs. Becton Dickinson
et al. (Case No. 98-5608, Hillsborough County Circuit Court) filed on July
24, 1998 was voluntarily withdrawn by the plaintiffs on March 8, 1999.
. The case brought in Pennsylvania under the caption McGeehan vs. Becton
Dickinson (Case No. 3474, Court of Common Pleas, Philadelphia County) filed
on November 27, 1998, was dismissed without leave to amend in an order
dated December 18, 2000.
. Cases have been filed on behalf of an unspecified number of healthcare
workers in eight other states, seeking class action certification under the
laws of these states. To date, no class has been certified in any of these
cases. The eight remaining actions are pending in state court in Texas,
under the caption Usrey vs. Becton Dickinson et al. (Case No. 342-173329-
98, Tarrant County District Court), filed on April 9, 1998; in Federal
Court in Ohio, under the caption Grant vs. Becton Dickinson et al. (Case
No. C2 98-844, Southern District of Ohio), filed on July 22, 1998; in state
court in Illinois, under the caption McCaster vs. Becton Dickinson et al.
(Case No. 98L09478, Cook County Circuit Court), filed on August 13, 1998;
in state court in Oklahoma, under the caption Palmer vs. Becton Dickinson
et al. (Case No. CJ-98-685, Sequoyah County District Court), filed on
October 27, 1998; in state court in Alabama, under the caption Daniels vs.
Becton Dickinson et al. (Case No. CV 1998 2757, Montgomery County Circuit
Court), filed on October 30, 1998; in state court in South Carolina, under
the caption Bales vs. Becton Dickinson et al. (Case No. 98-CP-40-4343,
Richland County Court of Common Pleas), filed on
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November 25, 1998; in state court in New Jersey, under the caption Pollak,
Swartley vs. Becton Dickinson et al. (Case No. L-9449-98, Camden County
Superior Court), filed on December 7, 1998; and in state court in New York,
under the caption Benner vs. Becton Dickinson et al. (Case No. 99-111372,
Supreme Court of the State of New York), filed on June 1, 1999. Generally,
these remaining actions allege that healthcare workers have sustained
needle sticks using hollow-bore needle devices manufactured by BD and, as a
result, require medical testing, counseling and/or treatment. Several
actions additionally allege that the healthcare workers have sustained
mental anguish. Plaintiffs seek money damages in all remaining actions.
In June 1999, a class certification hearing was held in the matter of Usrey
vs. Becton Dickinson et al., which was first filed in Texas state court on
April 9, 1998, under the caption Calvin vs. Becton Dickinson et al. The
Court has advised the parties by letter received October 27, 1999, that it
believes it is appropriate to address the issues in the case by way of a
class action under Texas procedural law. We have filed an interlocutory
appeal from that ruling. This appeal is currently pending.
We continue to oppose class action certification in these cases and will
continue vigorously to defend these lawsuits, including pursuing all
appropriate rights of appeal.
BD has insurance policies in place, and believes that a substantial portion
of defense costs and potential liability, if any, in the latex and class action
matters will be covered by insurance. In order to protect its rights to
coverage, we have filed an action for declaratory judgement under the caption
Becton Dickinson and Company vs. Adriatic Insurance Company et al. (Docket No.
MID-L-3649-99MT, Middlesex County Superior Court) in New Jersey state court. We
have established reserves to cover reasonably anticipated defense costs in all
product liability lawsuits, including the needlestick class action and latex
matters.
We, along with another manufacturer, a group purchasing organization
("GPO") and three hospitals, have been named as a defendant in an antitrust
action brought pursuant to the Texas Free Enterprise Act ("TFEA"). The action is
pending in state court in Texas, under the caption Retractable Technologies Inc.
vs. Becton Dickinson and Company et al. (Case No. 533*JG98, Brazoria County
District Court), filed on August 4, 1998. Plaintiff, a manufacturer of
retractable syringes, alleges that our contracts with GPOs exclude plaintiff
from the market in syringes and blood collection products, in violation of the
TFEA. Plaintiff also alleges that we have conspired with other manufacturers
to maintain its market share in these products. Plaintiff seeks money damages.
This action is in preliminary stages. We intend to mount a vigorous defense in
this action.
We, also with another patent holder, have filed an action for patent
infringement under the caption Becton Dickinson and Company et al. vs. B. Braun
Medical, Inc. (Case No. 2:99-CV-00987J, United States District Court for the
District of Utah) on December 15, 1999. The defendant has filed a counterclaim
against us, and alleges, among other things, that our contracts with group
purchasing organizations exclude defendant from the market in IV catheters, in
violation of the Sherman, Clayton, and Lanham acts. Defendant also alleges that
we have conspired with other manufacturers to maintain our market share in these
products. Defendant seeks money damages. The pending action is in preliminary
stages. We intend to prosecute our claim and vigorously defend against this
counterclaim.
In the patent infringement litigation under the caption Critikon, Inc. vs.
Becton Dickinson Vascular Access, Inc. (Civ. 93-108 (JJF), United States
District Court for the District of Delaware) the Court, on May 19, 2000, entered
judgment in favor of the plaintiff in the aggregate amount of $5,700,000,
excluding interest charges. We have filed pending postjudgment motions seeking
recalculation of damages on the basis of perceived error in the calculation of
damages, in both amount and duration. On December 11, 2000, we agreed to a
settlement in principle of this suit. Under the terms of the settlement in
principle, we have agreed to pay a minimum of $3,000,000 and have limited our
maximum potential liability in this matter, including interest charges, to
$8,000,000.
We are a party to a number of Federal proceedings in the United States
brought under the Comprehensive Environental Response, Compensation and
Liability Act, also known as "Superfund," and similar state laws. For all sites,
there are other potentially responsible parties that may be jointly or severally
liable to pay all cleanup costs. We accrue costs for estimated environmental
liabilities based upon our best estimate within the range of probable losses,
without considering possible third-party recoveries.
We also are involved in other legal proceedings and claims which arise in
the ordinary course of business, both as a plaintiff and a defendant.
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While it is not possible to predict or determine the outcome of the patent,
product liability, antitrust or other legal actions brought against BD, upon
resolution of such matters, BD may incur charges in excess of presently
established reserves. While such future charges, individually and in the
aggregate, could have a material adverse impact on our net income and net cash
flows in the period in which they are recorded or paid, in our opinion, the
results of the above matters, individually and in the aggregate, are not
expected to have a material adverse effect on our consolidated financial
condition.
Item 4. Submission of Matters to a Vote of Security Holders.
Not applicable.
Executive Officers of the Registrant (as of December 1, 2000)
The following is a list of the executive officers of BD, their ages and all
positions and offices held by each of them during the past five years. There is
no family relationship between any of the named persons.
<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Edward J. Ludwig.......................... 49 Director since 1999; President and Chief Executive Officer
since January 2000; President from May 1999 to January 2000;
Executive Vice President from July 1998 to May 1999; Senior
Vice President--Finance and Chief Financial Officer from July
1995 to June 1998; Vice President--Finance from May 1995 to
June 1995; Vice President--Finance and Controller from January
1995 to May 1995; and prior thereto, President--Becton
Dickinson Diagnostic Instrument Systems.
Richard O. Brajer......................... 40 President--Worldwide Clinical Laboratory Solutions since November 2000
President--Worldwide Preanalytical Solutions from July 1999 to
November 2000; President--Worldwide Sample Collection from October 1998
to July 1999; President--Infusion Therapy Europe from February
1998 to September 1998; Vice President/General
Manager--Consumer Products Europe from October 1995 to January
1998; Director, North America Marketing, Diabetes Health Care
from October 1994 to September 1995.
Gilberto Bulcao........................... 53 President - North and South Latin American since January
2000; President - South Latin America from October 1996 to
December 1999; and prior thereto, Division President - BD Brazil.
</TABLE>
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<TABLE>
<S> <C> <C>
Gary M. Cohen................... 41 President--Worldwide Medical Systems
since May 1999; Executive Vice President
from July 1998 to May 1999; President--
Becton Dickinson Europe and Worldwide
Sample Collection from October 1997 to
June 1998; President--Worldwide Sample
Collection from October 1996 to September
1997; and prior thereto President--Becton
Dickinson Division/Worldwide Hypodermic.
John R. Considine............... 50 Executive Vice President and Chief
Financial Officer since June 2000; Senior
Vice President, Finance of American Home
Products Corporation from February to
June 2000; and prior thereto, Vice
President, Finance of American Home
Products Corporation.
Vincent A. Forlenza............. 47 Senior Vice President-Technology,
Strategy and Development since February
1999; President--Worldwide
Microbiology Systems from October 1996 to
January 1999; President--Diagnostic
Instrument Systems from October 1995
to September 1996; and prior thereto,
Division President--Becton Dickinson
Advanced Diagnostics.
A. John Hanson.................. 56 President - Becton Dickinson Europe since
October 1998; Vice President Becton
Dickinson Vacutainer Systems Europe from
May 1997 to October 1998; and prior
thereto, Director of Operations.
Bridget M. Healy................ 45 Vice President, General Counsel and
Corporate Secretary since June 2000; Vice
President and Corporate Secretary from
February 1997 to June 2000; Assistant
Corporate Secretary, Associate General
Counsel and Senior Corporate Attorney
from September 1995 to February 1997.
James V. Jerbasi................ 62 Vice President--Human Resources since
February 1999, and prior thereto,
Director of International Human
Resources.
William A. Kozy................. 48 Senior Vice President - Company
Operations since November 2000; Senior
Vice President -- Manufacturing from
October 1998 to November 2000, President
-Worldwide Injection Systems from October
1996 to October 1998; President -
Worldwide Blood Collection from July 1995
to September 1996; and prior thereto;
Division President -Vacutainer Systems.
Deborah J. Neff................. 47 President--Worldwide Biosciences since
February 1999; President--Worldwide
Immunocytometry Systems from October 1996
to January 1999; President--Becton
Dickinson Immunocytometry Systems from
January 1995 to September 1996; and prior
thereto, Vice President--General Manager.
Rex C. Valentine................ 49 President - Becton Dickinson Japan since
January 1997, and prior thereto General
Manager, Diabetes Health Care, Becton
Dickinson Japan.
James R. Wessel................. 60 President - Becton Dickinson Asia - Pacific
since May 2000; President - Becton
Dickinson Canada from October 1996 to May
2000; President - BDRIA from April 1994
to September 1996; and prior thereto
Vice President Human Resources.
</TABLE>
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PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters.
BD's common stock is listed on the New York Stock Exchange. As of November
30, 2000, there were approximately 10,690 shareholders of record. The balance of
the information required by this item appears under the caption "Common Stock
Prices and Dividends" on the inside back cover of BD's 2000 Annual Report and is
incorporated herein by reference as part of Exhibit 13.
Item 6. Selected Financial Data.
The information required by this item is included under the caption "Nine-
Year Summary of Selected Financial Data" on pages 18 and 19 of BD's 2000 Annual
Report and is incorporated herein by reference as part of Exhibit 13.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
The information required by this item is included in the text contained
under the caption "Financial Review" on pages 20-26 of BD's 2000 Annual Report
and is incorporated herein by reference as part of Exhibit 13.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
The information required by this item is included in the text contained on
page 22 of the "Financial Review" section of BD's 2000 Annual Report, and in
notes 1 and 11 to the consolidated financial statements contained in BD's 2000
Annual Report, and each is incorporated herein by reference as part of Exhibit
13.
Item 8. Financial Statements and Supplementary Data.
The information required by this item is included on pages 27-48 of BD's
2000 Annual Report and is incorporated herein by reference as part of Exhibit
13.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
Not applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The information relating to directors required by this item will be
contained under the captions "Board of Directors", "Election of Directors" and
"Continuing Directors" in a definitive Proxy Statement involving the election of
directors which the registrant will file with the Securities and Exchange
Commission not later than 120 days after September 30, 2000 (the "Proxy
Statement"), and such information is incorporated herein by reference.
The information relating to executive officers required by this item is
included herein in Part I under the caption "Executive Officers of the
Registrant".
The information required pursuant to Item 405 of Regulation S-K will be
contained under the caption "Section 16(a) Beneficial Ownership Reporting
Compliance" in BD's Proxy Statement, and such information is incorporated herein
by reference.
Item 11. Executive Compensation.
The information required by this item will be contained under the captions
"Board of Directors" and "Executive Compensation" in BD's Proxy Statement, and
such information is incorporated herein by reference.
10
<PAGE>
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The information required by this item will be contained under the caption
"Share Ownership of Management and Certain Beneficial Owners" in BD's Proxy
Statement, and such information is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions.
The information required by this item will be contained under the caption
"Certain Transactions" in BD's Proxy Statement, and such information is
incorporated herein by reference.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a)(1) Financial Statements
The following consolidated financial statements of BD included in BD's 2000
Annual Report at the pages indicated in parentheses, are incorporated by
reference in Item 8 hereof:
Report of Independent Auditors (page 27)
Consolidated Statements of Income--Years ended September 30, 2000,
1999 and 1998 (page 28)
Consolidated Statements of Comprehensive Income--Years ended September
30, 2000, 1999 and 1998 (page 29)
Consolidated Balance Sheets--September 30, 2000 and 1999 (page 30)
Consolidated Statements of Cash Flows--Years ended September 30, 2000,
1999 and 1998 (page 31)
Notes to Consolidated Financial Statements (pages 32-48)
(a)(2) Financial Statement Schedules
The following consolidated financial statement schedule of BD is included
herein at the page indicated in parentheses:
Schedule II--Valuation and Qualifying Accounts (page 13)
All other schedules for which provision is made in the applicable
accounting regulations of the Securities Exchange Act of 1934 are not required
under the related instructions or are inapplicable, and therefore have been
omitted.
(a)(3) Exhibits
See Exhibit Index on pages 14, 15, 16 and 17 hereof for a list of all
management contracts, compensatory plans and arrangements required by this item
(Exhibit Nos. 10(a)(i) through 10(o)(ii)), and all other Exhibits filed or
incorporated by reference as a part of this report.
(b) Reports on Form 8-K
On July 20, 2000, BD filed a report on Form 8-K for purposes of reporting
its results for the third quarter ended June 30, 2000. On September 27, 2000, BD
filed a report on Form 8-K for purposes of reporting its program to reduce
costs, improve financial performance and support major product initiatives.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Becton, Dickinson and Company
By: /s/ Bridget M. Healy
----------------------------------
Bridget M. Healy
Vice President, General Counsel and Corporate Secretary
Dated: December 21, 2000
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below on the 21st day of December, 2000 by the following persons
on behalf of the registrant and in the capacities indicated.
<TABLE>
<CAPTION>
Name Capacity
---- --------
<S> <C>
/s/ Clateo Castellini Chairman of the Board
--------------------------------------------
Clateo Castellini
/s/ Edward J. Ludwig Director, President and Chief Executive Officer
-------------------------------------------- (Principal Executive Officer)
Edward J. Ludwig
/s/ John R. Considine Executive Vice President and
-------------------------------------------- Chief Financial Officer
John R. Considine (Principal Financial Officer)
/s/ Richard M. Hyne Vice President and Controller
-------------------------------------------- (Chief Accounting Officer)
Richard M. Hyne
/s/ Harry N. Beaty, M.D. Director
--------------------------------------------
Harry N. Beaty, M.D.
/s/ Henry P. Becton, Jr. Director
--------------------------------------------
Henry P. Becton, Jr.
/s/ Albert J. Costello Director
--------------------------------------------
Albert J. Costello
/s/ Gerald M. Edelman, M.D. Director
--------------------------------------------
Gerald M. Edelman, M.D.
/s/ Frank A. Olson Director
--------------------------------------------
Frank A. Olson
/s/ Willard J. Overlock, Jr. Director
--------------------------------------------
Willard J. Overlock, Jr.
/s/ James E. Perrella Director
--------------------------------------------
James E. Perrella
/s/ Alfred Sommer Director
--------------------------------------------
Alfred Sommer
/s/ Margaretha af Ugglas Director
--------------------------------------------
Margaretha af Ugglas
</TABLE>
12
<PAGE>
BECTON, DICKINSON AND COMPANY
SCHEDULE II--VALUATION AND QUALIFYING ACCOUNTS
YEARS ENDED SEPTEMBER 30, 2000, 1999, and 1998
(Thousands of dollars)
<TABLE>
<CAPTION>
=======================================================================================================================
Col. A Col. B Col. C Col. D Col. E
-----------------------------------------------------------------------------------------------------------------------
Additions
Charged
Balance at to Costs Balance at
Beginning and End of
Description of Period Expenses Deductions Period
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
2000
Against trade receivables:
For doubtful accounts...................... $34,775 $ 691 $ 2,480(A) $32,986
For cash discounts......................... 14,261 28,022 31,627 10,656
------- ------- ------- -------
Total.............................. $49,036 $28,713 $34,107 $43,642
======= ======= ======= =======
1999
Against trade receivables:
For doubtful accounts........................... $24,739 $13,244 $ 3,208(A) $34,775
For cash discounts.............................. 10,779 38,292 34,810 14,261
------- ------- ------- -------
Total..................................... $35,518 $51,536 $38,018 $49,036
======= ======= ======= =======
1998
Against trade receivables:
For doubtful accounts........................... $20,234 $ 9,406 $ 4,901(A) $24,739
For cash discounts.............................. 8,499 33,646 31,366 10,779
------- ------- ------- -------
Total..................................... $28,733 $43,052 $36,267 $35,518
======= ======= ======= =======
</TABLE>
_________________
(A) Accounts written off.
13
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
-------
Number Description Method of Filing
------ ----------- ----------------
<S> <C> <C>
3(a)(i) Restated Certificate of Incorporation, as Incorporated by reference to Exhibit 3(a) to
amended January 22, 1990 the registrant's Annual Report on Form 10-K
for fiscal year ended September 30, 1990
3(a)(ii) Amendment to the Restated Certificate of Incorporated by reference to Exhibit 3(a) to
Incorporation, as of August 5, 1996 the registrant's Quarterly Report on Form
10-Q for the period ended June 30, 1996
3(a)(iii) Amendment to the Restated Certificate of Incorporated by reference to Exhibit 3(a)(iii)
Incorporation, as of August 10, 1998 to the registrant's Quarterly Report on
Form 10-Q for the period ended June 30, 1998
3(b) By-Laws, as amended and restated as of Incorporated by reference to Exhibit 3(b) to
July 25, 2000 the registrant's Quarterly Report on Form
10-Q for the period ended June 30, 2000
4(a) Indenture, dated as of December 1, 1982, Incorporated by reference to Exhibit 4 to
between the registrant and Manufacturers Registration Statement No. 2-80707 on Form
Hanover Trust Company S-3 filed by the registrant
4(b) First Supplemental Indenture, dated as of Incorporated by reference to Exhibit 4(b) to
May 15, 1986, between the registrant and Registration Statement No. 33-5663 on Form
Manufacturers Hanover Trust Company S-3 filed by the registrant
4(c) Second Supplemental Indenture, dated as of Incorporated by reference to Exhibit 4(c) to
January 10, 1995, between the registrant Form 8-K filed by the registrant on January
and The Chase Manhattan Bank (formerly 12, 1995
known as Chemical Bank, the successor by
merger to Manufacturers Hanover Trust
Company)
4(d) Indenture, dated as of March 1, 1997, Incorporated by reference to Exhibit 4(a) to
between the registrant and The Chase Form 8-K filed by the registrant on July 31,
Manhattan Bank 1997 (the registrant hereby agrees to furnish
to the Commission upon request a copy of any
other instruments which define the rights of
holders of long-term debt of the registrant)
4(e)(i) Rights Agreement, dated November 28, 1995, Incorporated by reference to Exhibit 4(e)(i)
as amended and restated as of March 28, 2000, to the registrant's Quarterly Report on Form
between the registrant and First Chicago 10-Q for the period ended March 31, 2000
Trust Company of New York, which includes as
Exhibit A thereto, the Form of Right
Certificate, and as Exhibit B thereto, the
Summary of Rights to Purchase Preferred Stock
(the "Amended and Restated Rights Agreement")
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
Exhibit
-------
Number Description Method of Filing
------ ----------- ----------------
<S> <C> <C>
4(e)(ii) Amendment No. 1 to the Amended and Incorporated by reference to Exhibit 4(e)(ii)
Restated Rights Agreement, dated as of to the registrant's Quarterly Report on Form
April 24, 2000 10-Q for the period ended March 31, 2000
10(a)(i) Form of Employment Agreement providing Incorporated by reference to Exhibit 10(b)(i)
for certain payments to Executive Officers to the registrant's Quarterly Report on Form
in the event of a discharge or significant 10-Q for the period ended March 31, 2000
change in such officers' respective duties
after a change of control of the registrant
10(a)(ii) Form of Employment Agreement providing for Incorporated by reference to Exhibit 10(b)(ii)
certain payments to Corporate Officers in the to the registrant's Quarterly Report on Form
event of a discharge or significant change in 10-Q for the period ended March 31, 2000
such officers' respective duties after a change
of control of the registrant
10(b)(i) Form of Split Dollar Agreement and related Incorporated by reference to Exhibit 10(e) to
Collateral Assignment covering the providing to the registrant's Annual Report on Form 10-K
certain corporate officers of a life insurance for the fiscal year ended September 30, 1987
policy in an amount equal to two times base
salary in lieu of full participation in the
registrant's group life insurance program
10(b)(ii) Form of Endorsement Method Split Dollar Incorporated by reference to Exhibit
Agreement covering the providing to certain 10(c)(ii) to the registrant's Annual Report
corporate officers of a life insurance policy on Form 10-K for the fiscal year ended
in an amount equal to two times base salary September 30, 1999
in lieu of full participation in the
registrant's group life insurance program
10(c)(i) Stock Award Plan, as amended and restated Incorporated by reference to Exhibit 10(d) to
effective February 11, 1992 the registrant's Annual Report on Form 10-K
for the fiscal year ended September 30, 1992
10(c)(ii) Amendment dated as of April 24, 2000 to the Incorporated by reference to Exhibit 10(d) to
Stock Award Plan, as amended and restated the registrant's Quarterly Report on Form 10-Q
effective February 11, 1992 for the period ended June 30, 2000
10(d) 1997 Management Incentive Plan Incorporated by reference to Exhibit 10(e) to
the registrant's Annual Report on Form 10-K
for the fiscal year ended September 30, 1997
10(e)(i) 1982 Unqualified Stock Option Plan, as Incorporated by reference to Exhibit 10(f) to
amended and restated February 8, 1994 the registrant's Annual Report on Form 10-K
for the fiscal year ended September 30, 1994
10(e)(ii) Amendment dated as of April 24, 2000 to the Incorporated by reference to Exhibit 10(f) to
1982 Unqualified Stock Option Plan, as amended the registrant's Quarterly Report on Form 10-Q
and restated February 8, 1994 for the period ended June 30, 2000
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
Exhibit
-------
Number Description Method of Filing
------ ----------- ----------------
<S> <C> <C>
10(f)(i) Salary and Bonus Deferral Plan, as amended and Incorporated by reference to Exhibit 4 to
restated August 15, 1996 Registration Statement No. 333-11885 on Form
S-8 filed by the registrant
10(f)(ii) Amendment dated as of April 24, 2000 to the Incorporated by reference to Exhibit 10(g)(i)
Salary and Bonus Deferral Plan, as amended and to the registrant's Quarterly Report on Form
restated as of August 15, 1996 10-Q for the period ended June 30, 2000
10(f)(iii) Amendment dated as of November 27, 2000 to the Filed with this report
Salary and Bonus Deferral Plan, as amended and
restated as of August 15, 1996
10(g)(i) 1996 Directors' Deferral Plan Incorporated by reference to Exhibit 4 to
Registration Statement No. 333-16091 on Form
S-8 filed by the registrant
10(g)(ii) Amendment dated as of April 24, 2000 to the Incorporated by reference to Exhibit
1996 Directors' Deferral Plan, dated November 1, 10(g)(ii) to the registrant's Quarterly
1996 Report on Form 10-Q for the period ended June
30, 2000
10(h)(i) 1990 Stock Option Plan, as amended and restated Incorporated by reference to Exhibit 10(i) to
February 8, 1994 the registrant's Annual Report on Form 10-K
for the fiscal year ended September 30, 1994
10(h)(ii) Amendment dated as of April 24, 2000 to the Incorporated by reference to Exhibit 10(h) to
1990 Stock Option Plan, as amended and restated the registrant's Quarterly Report on Form
February 8, 1994 10-K for the period ended June 30, 2000
10(i)(i) Retirement Benefit Restoration Plan, Filed with this report
as amended and restated as of November 27, 2000
10(i)(ii) Employee Participation Agreement dated Filed with this report
November 27, 2000 between the registrant and
John R. Considine
10(i)(iii) Agreement dated December 18, 2000 between the Filed with this report
registrant and John R. Considine.
10(j)(i) 1994 Restricted Stock Plan for Non-Employee Incorporated by reference to Exhibit A to the
Directors registrant's Proxy Statement dated January 5,
1994
10(j)(ii) Amendment to the 1994 Restricted Stock Incorporated by reference to Exhibit 10(j)(ii)
Plan for Non-Employee Directors as of to the registrant's Annual Report on Form
November 26, 1996 10-K for the fiscal year ended September 30,
1996
10(k)(i) 1995 Stock Option Plan, as amended and restated Incorporated by reference to Exhibit 10(k) to
January 27, 1998 the registrant's Annual Report on Form 10-K
for the fiscal year ended September 30, 1998
10(k)(ii) Amendments dated as of April 24, 2000 to the Incorporated by reference to Exhibit 10(k) to
1995 Stock Option Plan, as amended and restated the registrant's Quarterly Report on Form 10-Q
January 27, 1998 for the period ended June 30, 2000
10(l)(i) 1998 Stock Option Plan Incorporated by reference to Exhibit 10.1 to
the registrant's Quarterly Report on Form
10-Q/A for the period ended March 31, 1998
10(l)(ii) Amendments dated as of April 24, 2000 to the Incorporated by reference to Exhibit 10(l) to
1998 Stock Option Plan the registrant's Quarterly Report on Form
10-Q for the period ended June 30, 2000
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
Exhibit
-------
Number Description Method of Filing
------ ----------- ----------------
<S> <C> <C>
10(m) Australian, French and Spanish addenda to the Incorporated by reference to Exhibit 10(m) to
Becton, Dickinson and Company Stock Option the registrant's Annual Report on Form 10-K
Plans for the fiscal year ended September 30, 1998
10(n) Indian addendum to the Becton, Dickinson and Incorporated by reference to Exhibit 10(n) to
Company Stock Option Plans the registrant's Annual Report on Form 10-K
for the fiscal year ended September 30, 1999
10(o)(i) Non-Employee Directors 2000 Stock Option Plan Incorporated by reference to Exhibit 10(o) to
the registrant's Quarterly Report on Form 10-Q
for the period ended March 31, 2000
10(o)(ii) Amendments dated as of April 24, 2000 to the Incorporated by reference to Exhibit 10(o) to
Non-Employee Directors 2000 Stock Option Plan the registrant's Quarterly Report on Form 10-Q
for the period ended June 30, 2000
13 Portions of the registrant's Annual Report to Filed with this report
Shareholders for fiscal year 2000
21 Subsidiaries of the registrant Filed with this report
23 Consent of independent auditors Filed with this report
27 Financial Data Schedule Filed with this report
</TABLE>
Copies of any Exhibits not accompanying this Form 10-K are available at a charge
of 25 cents per page by contacting: Investor Relations, Becton, Dickinson and
Company, 1 Becton Drive, Franklin Lakes, New Jersey 07417-1880, Phone:
1-800-284-6845.
17
