United states securities and exchange commission

Table of Contents
BIOGEN INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
F- 51
Deferred Tax Assets and Liabilities
Significant components of our deferred tax assets and liabilities are summarized as follows:
 
As of December 31,
(In millions)
2017
2016
Deferred tax assets:
Tax credits
$
60.0
$
201.1
Inventory, other reserves and accruals
147.8
250.6
Intangibles, net
378.8
459.8
Net operating loss
209.8
65.9
Share-based compensation
26.9
61.5
Other
25.1
49.0
Valuation allowance
(16.6)
(16.1)
Total deferred tax assets
$
831.8
$
1,071.8
Deferred tax liabilities:
Purchased intangible assets
$
(250.7)
$
(376.6)
Depreciation, amortization and other
(107.9)
(113.5)
Total deferred tax liabilities
$
(358.6)
$
(490.1)
In addition to deferred tax assets and liabilities, we have recorded prepaid tax and deferred charges related to 
intercompany transactions. As of December 31, 2017 and 2016, the total deferred charges and prepaid taxes were 
$617.7 million and $989.8 million, respectively.
In October 2016 the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfer of Assets 
Other Than Inventory. This new standard eliminates the deferral of the tax effects of intra-entity asset transfers other 
than inventory. As a result, the income tax consequences from the intra-entity transfer of an asset other than 
inventory and associated changes to deferred taxes will be recognized when the transfer occurs. 
This new standard becomes effective for us on January 1, 2018. We will adopt this standard using the modified 
retrospective method, through a cumulative-effect adjustment directly to retained earnings as of that date. Based on 
currently enacted tax rates, upon adoption in 2018, we will record additional deferred tax assets of approximately 
$0.5 billion and an increase to retained earnings of approximately $0.5 billion. We will recognize incremental 
deferred income tax expense thereafter as these net deferred tax assets are utilized.
Tax Rate
A reconciliation between the U.S. federal statutory tax rate and our effective tax rate is summarized as follows:
 
For the Years Ended December 31,
 
2017
2016
2015
Statutory rate
35.0%
35.0%
35.0%
State taxes
0.8
0.9
0.5
Taxes on foreign earnings
(11.1)
(9.6)
(10.0)
Credits and net operating loss utilization
(0.8)
(1.4)
(1.3)
Purchased intangible assets
1.4
1.2
1.0
Manufacturing deduction
(1.9)
(1.9)
(1.8)
2017 Tax Act
22.9
—
—
Impairment of ZINBRYTA related tax assets
0.9
—
—
Other permanent items
0.7
0.5
0.7
Other
—
0.4
0.3
Effective tax rate
47.9%
25.1%
24.4%

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Table of Contents
BIOGEN INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
F- 52
Changes in Tax Rate
The most significant factors contributing to the increase in our effective tax rate for the year ended 
December 31, 2017, as compared to 2016 is the effect of the enactment of the 2017 Tax Act and the impairment of 
certain ZINBRYTA related tax assets, both of which are discussed above. Excluding the effect of these items, our 
income tax rate would have decreased due to a lower percentage of our earnings being recognized in the U.S., a 
higher tax jurisdiction. The geographic split of our earnings was affected by milestone and upfront payments in the 
current year and the spin-off of our hemophilia business, partially offset by growth from the U.S. launch of SPINRAZA 
and increases in our revenues from anti-CD20 therapeutic programs in the U.S. In addition, in 2017 we earned a 
lower benefit from the orphan drug credit due to the FDA's approval of SPINRAZA.
Our effective tax rate for 2016 compared to 2015 increased primarily due to a net state tax benefit in 2015 
resulting from the remeasurement of one of our uncertain tax positions, described below, and a higher relative 
percentage of our earnings being attributed to the U.S., a higher tax jurisdiction.
Tax Attributes
As of December 31, 2017, we had net operating losses and general business credit carry forwards for federal 
income tax purposes of approximately $1.4 million and $1.3 million, respectively, which begin to expire in 2020. 
Additionally, for state income tax purposes, we had net operating loss carry forwards of approximately $19.3 million 
that begin to expire in 2018. For state income tax purposes, we also had research and investment credit carry 
forwards of approximately $129.7 million that begin to expire in 2018. For foreign income tax purposes, we had $2.1 
billion of net operating loss carryforwards that begin to expire in 2021.
In assessing the realizability of our deferred tax assets, we have considered whether it is more likely than not 
that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets 
is dependent upon the generation of future taxable income during the periods in which those temporary differences 
become deductible. In making this determination, under the applicable financial reporting standards, we are allowed 
to consider the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning 
strategies. Our estimates of future taxable income take into consideration, among other items, our estimates of 
future income tax deductions related to the exercise of stock options. Based upon the level of historical taxable 
income and income tax liability and projections for future taxable income over the periods in which the deferred tax 
assets are utilizable, we believe it is more likely than not that we will realize the net benefits of the deferred tax 
assets of our wholly owned subsidiaries. In the event that actual results differ from our estimates or we adjust our 
estimates in future periods, we may need to establish a valuation allowance, which could materially impact our 
consolidated financial position and results of operations.
Accounting for Uncertainty in Income Taxes
A reconciliation of the beginning and ending amount of our unrecognized tax benefits is summarized as follows:
(In millions)
2017
2016
2015
Balance at January 1,
$
32.4
$
67.9 $
131.5
Additions based on tax positions related to the current period
5.7
7.2
10.5
Additions for tax positions of prior periods
7.3
36.3
19.5
Reductions for tax positions of prior periods
(21.8)
(13.3)
(49.9)
Statute expirations
(1.4)
(1.4)
(1.2)
Settlement refund (payment)
44.6
(64.3)
(42.5)
Balance at December 31,
$
66.8
$
32.4 $
67.9
Our 2017 activity above reflects a refund received from a state, related to the settlement of an uncertain tax 
position.
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 2013 or state, local or non-U.S. income tax examinations for years 
before 2010.

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