Table of Contents laws are sought in the United States and other countries through reform of patent and other relevant laws and implementation of international treaties.
The Company has the following key U. S.  patent protection for drug candidates under review in the United States by the FDA.
Additional patent term may be provided for these pipeline candidates based on Patent Term Restoration and Pediatric Exclusivity.
## Table 0 ##
The Company also has the following key U. S.  patent protection for drug candidates in Phase 3 development:
## Table 1 ##
Unless otherwise noted, the patents in the above charts are compound patents.
Each patent is subject to any future patent term restoration of up to five years and six month pediatric market exclusivity, either or both of which may be available.
In addition, depending on the circumstances surrounding any final regulatory approval of the compound, there may be other listed patents or patent applications pending that could have relevance to the product as finally approved; the relevance of any such application would depend upon the claims that ultimately may be granted and the nature of the final regulatory approval of the product.
Also, regulatory exclusivity tied to the protection of clinical data is complementary to patent protection and, in some cases, may provide more effective or longer lasting marketing exclusivity than a compound’s patent estate.
In the United States, the data protection generally runs five years from first marketing approval of a new chemical entity, extended to seven years for an orphan drug indication and 12 years from first marketing approval of a biological product.
For further information with respect to the Company’s patents, see Item 1A.
“Risk Factors” and Item 8.
“Financial Statements and Supplementary Data,” Note 10.
“Contingencies and Environmental Liabilities” below.
Worldwide, all of the Company’s important products are sold under trademarks that are considered in the aggregate to be of material importance.
Trademark protection continues in some countries as long as used; in other countries, as long as registered.
Registration is for fixed terms and can be renewed indefinitely.
Royalty income in 2014 on patent and know-how licenses and other rights amounted to $274 million.
Merck also incurred royalty expenses amounting to $1.1 billion in 2014 under patent and know-how licenses it holds.
Research and Development The Company’s business is characterized by the introduction of new products or new uses for existing products through a strong research and development program.
Approximately 11,400 people are employed in the Company’s research activities.
Research and development expenses were $7.2 billion in 2014, $7.5 billion in 2013 and $8.2 billion in 2012 (which included restructuring costs and acquisition-related costs in all years).
The Company
A summary of nonvested RSU and PSU activity (shares in thousands) is as follows:
## Table 2 ##
At December 31, 2014, there was $401 million of total pretax unrecognized compensation expense related to nonvested stock options, RSU and PSU awards which will be recognized over a weighted average period of 1.9 years.
For segment reporting, share-based compensation costs are unallocated expenses.13.
Pension and Other Postretirement Benefit Plans The Company has defined benefit pension plans covering eligible employees in the United States and in certain of its international subsidiaries.
As a result of plan design changes approved in 2011, beginning on January 1, 2013, active participants in Merck’s primary U. S.  defined benefit pension plans are accruing pension benefits using new cash balance formulas based on age, service, pay and interest.
However, during a transition period from January 1, 2013 through December 31, 2019, participants will earn the greater of the benefit as calculated under the employee’s legacy final average pay formula or their new cash balance formula.
For all years of service after December 31, 2019, participants will earn future benefits under only the cash balance formula.
In addition, the Company provides medical benefits, principally to its eligible U. S.  retirees and their dependents, through its other postretirement benefit plans.
The Company uses December 31 as the year-end measurement date for all of its pension plans and other postretirement benefit plans.
Net Periodic Benefit Cost The net periodic benefit cost for pension and other postretirement benefit plans consisted of the following components
## Table 3 ##
The decrease in net periodic benefit cost for pension and other postretirement benefit plans in 2014 as compared with 2013 is largely attributable to a change in the discount rate.
In connection with restructuring actions (see Note 3), termination charges were recorded in 2014, 2013 and 2012 on pension and other postretirement benefit plans related to expanded eligibility for certain employees exiting Merck.
Also, in connection with these restructuring activities, curtailments were recorded in 2014, 2013 and 2012 on pension and other postretirement benefit plans
Table of Contents Affiliate Information” below).
Revenue from AZLP, primarily relating to sales of Nexium and Prilosec, was $463 million in 2014 through the termination date on June 30, 2014, $920 million in 2013 and $915 million in 2012.
Consumer Care As noted above, on October 1, 2014, the Company divested its Consumer Care segment.
Consumer Care products included over-the-counter, foot care and sun care products.
Global sales of Consumer Care were $1.5 billion in 2014, $1.9 billion in 2013 and $2.0 billion in 2012.
## Table 4 ##
* 100% or greater.
(1) Includes $49 million, $279 million and $200 million of IPR&D impairment charges in 2014, 2013 and 2012, respectively.
Materials and Production Materials and production costs were $16.8 billion in 2014, $17.0 billion in 2013 and $16.4 billion in 2012.
Costs include expenses for the amortization of intangible assets recorded in connection with mergers and acquisitions which totaled $4.2 billion in 2014, $4.7 billion in 2013 and $4.9 billion in 2012.
Costs in 2014 and 2013 include intangible asset impairment charges of $1.1 billion and $486 million, respectively, related to marketed products (see Note 7 to the consolidated financial statements).
The Company may recognize additional non-cash impairment charges in the future related to product intangibles that were measured at fair value and capitalized in connection with mergers and acquisitions and such charges could be material.
Additionally, costs in 2013 include a $41 million intangible asset impairment charge related to a licensing agreement.
Also included in materials and production were costs associated with restructuring activities which amounted to $482 million, $446 million and $188 million in 2014, 2013 and 2012, respectively, including accelerated depreciation and asset write-offs related to the planned sale or closure of manufacturing facilities.
Separation costs associated with manufacturing-related headcount reductions have been incurred and are reflected in Restructuring costs as discussed below.
Gross margin was 60.3% in 2014 compared with 61.5% in 2013 and 65.2% in 2012.
The amortization of intangible assets, as well as the restructuring and impairment charges noted above reduced gross margin by 13.6 percentage points in 2014, 12.8 percentage points in 2013 and 10.7 percentage points in 2012.
Excluding these impacts, the gross margin decline in 2014 as compared with 2013 was driven primarily by the unfavorable effects of inventory write-offs largely related to Victrelis, as well as by changes in product mix, partially offset by the sale of the U. S.  marketing rights to Saphris.
The gross margin decline in 2013 as compared with 2012 was driven in part by the loss of Singulair sales as result of patent expiries in the United States in August 2012 and in major European markets in February 2013.
In addition, generic competition in the United States coupled with changes in product mix and continued pricing pressures in mature markets also negatively affected gross margin in 2013 as compared with 2012.
Marketing and Administrative Marketing and administrative expenses declined 3% in 2014 to $11.6 billion driven primarily by lower selling costs and promotional spending, the divestiture of MCC and the favorable effect of foreign exchange, partially offset by an additional year of expense related to the health care reform fee as discussed below, as well as higher acquisition and divestiture-related costs.
Marketing and administrative expenses decreased 7% in 2013 to $11.9 billion largely due to lower promotional spending and selling costs resulting from restructuring activities, and also reflecting the favorable effect of foreign exchange.
Expenses for 2014, 2013 and 2012 include restructuring costs of $200 million, $145 million and $90 million, respectively, related primarily to accelerated depreciation for facilities to be closed or
value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired as of December 31, 2005 and 2004.
Gross realized gains and losses for 2005 were $15,000 and $75,000, respectively.
Gross realized gains and losses for 2004 were $628,000 and $205,000, respectively.
Gross realized gains for 2003 were $1,249,000.
There were no gross realized losses for 2003.
Maturities stated are effective maturities.
F.  Restricted Cash At December 31, 2005 and 2004, the Company held $41,482,000 and $49,847,000, respectively, in restricted cash.
At December 31, 2005 and 2004 the balance was held in deposit with certain banks predominantly to collateralize conditional stand-by letters of credit in the names of the Company's landlords pursuant to certain operating lease agreements.
G.  Property and Equipment Property and equipment consist of the following at December 31 (in thousands):
## Table 5 ##
Depreciation expense for the years ended December 31, 2005, 2004 and 2003 was $26,307,000, $28,353,000 and $27,988,000 respectively.
In 2005 and 2004, the Company wrote off certain assets that were fully depreciated and no longer utilized.
There was no effect on the Company's net property and equipment.
Additionally, the Company wrote off or sold certain assets that were not fully depreciated.
The net loss on disposal of those assets was $344,000 for 2005 and $43,000 for 2004.
H.  Investments In accordance with the Company's policy, as outlined in Note B, "Accounting Policies," the Company assessed its investment in Altus Pharmaceuticals, Inc.  ("Altus"), which it accounts for using the cost method, and determined that there had not been any adjustments to the fair values of that investment which would indicate a decrease in its fair value below the carrying value that would require the Company to write down the investment basis of the asset, as of December 31, 2005 and December 31, 2004.
The Company's cost basis carrying value in its outstanding equity and warrants of Altus was $18,863,000 at December 31, 2005 and 2004.

<table><tr><td>Under Review</td><td>Currently AnticipatedYear of Expiration (in the U.S.)</td></tr><tr><td>MK-8962 (corifollitropin alfa injection)</td><td>2018 (formulation/use)</td></tr><tr><td>V419 (pediatric hexavalent combination vaccine)</td><td>2020 (method of making/vectors)</td></tr><tr><td>MK-8616 (sugammadex) Injection</td><td>2021</td></tr></table>
<table><tr><td>Phase 3 Drug Candidate</td><td rowspan="8">Currently AnticipatedYear of Expiration (in the U.S.) 2016 (use) 2024 2025 2025 2026 (use) 2027 2028</td></tr><tr><td>V212 (inactivated varicella zoster virus (“VZV”) vaccine)</td></tr><tr><td>MK-0822 (odanacatib)</td></tr><tr><td>MK-8228 (letermovir)</td></tr><tr><td>MK-2402 (bevenopran)</td></tr><tr><td>MK-8237 (allergy, house dust mites)</td></tr><tr><td>MK-0859 (anacetrapib)</td></tr><tr><td>MK-3415A (actoxumab/bezlotoxumab)</td></tr><tr><td>MK-5172A (grazoprevir/elbasvir)</td><td>2030</td></tr><tr><td>MK-3102 (omarigliptin)</td><td>2030</td></tr><tr><td>MK-8931 (BACE Inhibitor)</td><td>2030</td></tr><tr><td>MK-8835 (ertugliflozin)</td><td>2031</td></tr><tr><td>MK-1439 (doravirine)</td><td>2031</td></tr><tr><td>MK-4261 (surotomycin)</td><td>2031</td></tr></table>
<table><tr><td></td><td colspan="2">RSUs</td><td colspan="2">PSUs</td></tr><tr><td></td><td>Numberof Shares</td><td>WeightedAverageGrant DateFair Value</td><td>Numberof Shares</td><td>WeightedAverageGrant DateFair Value</td></tr><tr><td>Nonvested January 1, 2014</td><td>19,134</td><td>$40.07</td><td>1,673</td><td>$35.98</td></tr><tr><td>Granted</td><td>4,776</td><td>58.13</td><td>1,224</td><td>62.94</td></tr><tr><td>Vested</td><td>-6,866</td><td>36.36</td><td>-723</td><td>33.97</td></tr><tr><td>Forfeited</td><td>-1,410</td><td>46.22</td><td>-292</td><td>45.49</td></tr><tr><td>Nonvested December 31, 2014</td><td>15,634</td><td>$46.66</td><td>1,882</td><td>$52.81</td></tr></table>
<table><tr><td></td><td colspan="6">Pension Benefits</td><td></td><td></td><td></td></tr><tr><td></td><td colspan="3">U.S.</td><td colspan="3">International</td><td colspan="3">Other Postretirement Benefits</td></tr><tr><td>Years Ended December 31</td><td>2014</td><td>2013</td><td>2012</td><td>2014</td><td>2013</td><td>2012</td><td>2014</td><td>2013</td><td>2012</td></tr><tr><td>Service cost</td><td>$300</td><td>$386</td><td>$324</td><td>$266</td><td>$296</td><td>$231</td><td>$78</td><td>$102</td><td>$82</td></tr><tr><td>Interest cost</td><td>425</td><td>402</td><td>401</td><td>269</td><td>263</td><td>260</td><td>115</td><td>107</td><td>121</td></tr><tr><td>Expected return on plan assets</td><td>-782</td><td>-721</td><td>-617</td><td>-416</td><td>-376</td><td>-354</td><td>-139</td><td>-126</td><td>-136</td></tr><tr><td>Net amortization</td><td>74</td><td>251</td><td>149</td><td>59</td><td>85</td><td>36</td><td>-71</td><td>-50</td><td>-35</td></tr><tr><td>Termination benefits</td><td>53</td><td>51</td><td>17</td><td>11</td><td>7</td><td>10</td><td>22</td><td>50</td><td>18</td></tr><tr><td>Curtailments</td><td>-69</td><td>-22</td><td>-11</td><td>-4</td><td>-1</td><td>2</td><td>-39</td><td>-11</td><td>-7</td></tr><tr><td>Settlements</td><td>11</td><td>1</td><td>5</td><td>6</td><td>22</td><td>13</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Net periodic benefit cost (credit)</td><td>$12</td><td>$348</td><td>$268</td><td>$191</td><td>$296</td><td>$198</td><td>$-34</td><td>$72</td><td>$43</td></tr></table>
<table><tr><td>($ in millions)</td><td>2014</td><td>Change</td><td>2013</td><td>Change</td><td>2012</td></tr><tr><td>Materials and production</td><td>$16,768</td><td>-1%</td><td>$16,954</td><td>3%</td><td>$16,446</td></tr><tr><td>Marketing and administrative</td><td>11,606</td><td>-3%</td><td>11,911</td><td>-7%</td><td>12,776</td></tr><tr><td>Research and development<sup>-1</sup></td><td>7,180</td><td>-4%</td><td>7,503</td><td>-8%</td><td>8,168</td></tr><tr><td>Restructuring costs</td><td>1,013</td><td>-41%</td><td>1,709</td><td>*</td><td>664</td></tr><tr><td>Equity income from affiliates</td><td>-257</td><td>-36%</td><td>-404</td><td>-37%</td><td>-642</td></tr><tr><td>Other (income) expense, net</td><td>-11,356</td><td>*</td><td>815</td><td>-27%</td><td>1,116</td></tr><tr><td></td><td>$24,954</td><td>-35%</td><td>$38,488</td><td>—%</td><td>$38,528</td></tr></table>
<table><tr><td></td><td>2005</td><td>2004</td></tr><tr><td>Furniture and equipment</td><td>$98,387</td><td>$90,893</td></tr><tr><td>Leasehold improvements</td><td>66,318</td><td>65,294</td></tr><tr><td>Computers</td><td>18,971</td><td>18,421</td></tr><tr><td>Software</td><td>18,683</td><td>16,411</td></tr><tr><td>Total property and equipment, gross</td><td>202,359</td><td>191,019</td></tr><tr><td>Less accumulated depreciation and amortization</td><td>147,826</td><td>126,794</td></tr><tr><td>Total property and equipment, net</td><td>$54,533</td><td>$64,225</td></tr></table>

Question: Which year is Interest cost for International the most?