Senate Finance Committee Chair Ron Wyden (D-Ore.) has announced an investigation of AbbVie’s (NYSE: ABBV) tax practices.
In a statement, the senator argued that the company’s tax rate from 2018 to 2020 was 9.5% — less than half of the 20% rate it paid in 2016.
Wyden has sent a letter to AbbVie CEO Richard Gonzalez seeking information about the company’s tax practices.
In the letter, Wyden questioned why the company reported a U.S. pretax loss of $4.5 billion while an offshore pretax profit of $7.9 billion in 2020. “Despite the United States market being the source of most of AbbVie’s revenues and richest price premiums, it appears that the company has consistently reported net losses in the United States while reporting substantial foreign profits,” he wrote.
AbbVie did not immediately respond to a request for comment regarding Wyden’s investigation.
AbbVie is also the subject of a May report from the House Committee on Oversight and Reform that argued the company aggressively inflated the price of its best-selling drugs Humira and Imbruvica.
Gonzales testified in May before the House Oversight and Reform Committee, where he stressed the company’s role in developing novel treatments for challenging diseases. “Our company alone has invested approximately $50 billion since 2013 to produce cures for diseases like HCV [hepatitis C virus] and therapies that are changing and prolonging lives of patients suffering from cancer, rheumatoid arthritis and other serious diseases,” Gonzelez said. “As we tackle issues associated with drug pricing and access, it is important that we focus on what is working and what needs to change to make sure that patients get the medicines they need.”
Filed Under: Drug Discovery and Development