Illinois-based AbbVie Inc. makes the bulk of its profits from arthritis drug Humira on sales in the U.S., but the company reports almost all its taxable income in foreign subsidiaries, according to a Senate Finance Committee report that criticizes the pharmaceutical company’s use of entities in Bermuda and Puerto Rico to reduce its tax burden.
The Democratic staff report details how AbbVie Biotechnology Ltd., a Bermuda-based AbbVie subsidiary with no employees or significant operations in Bermuda, owns the U.S. intellectual property rights for Humira, one of the world’s top-selling drugs. It manufactures the drug through a branch in low-tax Puerto Rico, which is considered foreign for U.S. tax purposes.
