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Income Taxes
 6 Months Ended
Jun. 30, 2023
Income Tax Disclosure [Abstract]  
Income Taxes
Inflation Reduction Act
In August 2022 the IRA was signed into law in the U.S. The IRA introduced new tax provisions, including a 15.0% corporate alternative minimum tax and a 1.0% excise tax on stock repurchases. The provisions of the IRA are effective for periods after December 31, 2022. The IRA did not result in any material adjustments to our income tax provision or other income tax balances as of June 30, 2023 and December 31, 2022. We expect additional guidance and regulations to be issued in future periods and will continue to assess its potential impact on our business and results of operations as further information becomes available.
Tax Rate
A reconciliation between the U.S. federal statutory tax rate and our effective tax rate is summarized as follows:
For the Three Months Ended June 30,For the Six Months Ended June 30,
 2023202220232022
Statutory rate21.0 %21.0 %21.0 %21.0 %
State taxes1.2 0.6 1.2 0.4 
Taxes on foreign earnings(4.7)(3.8)(5.0)(5.3)
Tax credits(2.0)(1.4)(3.7)(1.6)
Purchased intangible assets0.3 0.1 0.3 0.2 
GILTI0.2 0.2 0.3 0.2 
Sale of Samsung Bioepis— (3.7)— (2.9)
Litigation settlement agreement— 8.5 — 6.7 
Neurimmune tax impacts— — — 5.2 
International reorganization— (4.0)— (3.1)
Other0.2 (0.4)0.3 0.4 
Effective tax rate16.2 %17.1 %14.4 %21.2 %
Changes in Tax Rate
For the three and six months ended June 30, 2023, compared to the same periods in 2022, the decreases in our effective tax rates were primarily due to the combined net unfavorable tax rate impacts during the second quarter of 2022 related to a litigation settlement agreement, the sale of our equity interest in Samsung Bioepis, the non-cash tax effects of changes in the value of our equity investments and an international reorganization to align with global tax developments.
The decrease in our effective tax rate for the six months ended June 30, 2023, also reflects the resolution of an uncertain tax matter during the first quarter of 2023 related to tax credits as well as the impact of the Neurimmune valuation allowance recorded in the first quarter of 2022, as discussed below.
Neurimmune Deferred Tax Asset
During the first quarter of 2022, upon issuance of the final NCD related to ADUHELM, we recorded an increase in a valuation allowance of approximately $85.0 million to reduce the net value of a previously recorded deferred tax asset to zero.
This adjustment to our net deferred tax asset is recorded with an equal and offsetting amount assigned to net income (loss) attributable to noncontrolling interests, net of tax in our condensed consolidated statements of income, resulting in a zero net impact to net income attributable to Biogen Inc.
For additional information on our collaboration arrangement with Neurimmune, please read Note 17, Investments in Variable Interest Entities, to these condensed consolidated financial statements.
Accounting for Uncertainty in Income Taxes
We and our subsidiaries are routinely examined by various taxing authorities. We file income tax returns in various U.S. states and in U.S. federal and other foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal tax examination for years before 2019 or state, local or non-U.S. income tax examinations for years before 2013.
The U.S. Internal Revenue Service and other national tax authorities routinely examine our intercompany transfer pricing with respect to intellectual property related transactions and it is possible that they may disagree with one or more positions we have taken with respect to such valuations.
It is reasonably possible that we will adjust the value of our uncertain tax positions related to certain transfer pricing, collaboration matters and other issues as we receive additional information from various taxing authorities, including reaching settlements with such authorities.
We estimate that it is reasonably possible that our gross unrecognized tax benefits, exclusive of interest, could
decrease by up to approximately $470.0 million, including approximately $460.0 million related to the unrecognized
tax benefits related to Neurimmune's tax basis in ADUHELM, as discussed above, in the next 12 months as a result of various audit closures, settlements and expiration of the statute of limitations. Any changes to our gross unrecognized tax benefits related to Neurimmune's tax basis in ADUHELM would result in a zero net impact to net income attributable to Biogen, Inc., as we have recorded a full valuation allowance against the relevant deferred tax assets.