INCOME TAXES

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The following table summarizes our Income tax (benefit) expense:

	Three Months Ended
	March 31,
(in millions, except percentages)	2024			2023
(Loss) income before income taxes	$	(4,486)		$	1,300
Income tax (benefit) expense	$	(315)		$	316
Effective tax rate	7.0		%	24.3		%

Our effective income tax rate of 7.0% for the three months ended March 31, 2024 differed from the U.S. federal statutory rate of 21% primarily due to $3.9 billion of non-deductible acquired IPR&D expense recorded in connection with our acquisition of CymaBay, partially offset by a decrease in state deferred tax liabilities associated with the $2.4 billion NSCLC IPR&D intangible asset impairment charge and settlements with tax authorities.

Our effective income tax rate of 24.3% for the three months ended March 31, 2023 differed from the U.S. federal statutory rate of 21% primarily due to $244 million of non-deductible acquired IPR&D expense recorded in connection with our acquisition of Tmunity.

Our income tax returns are subject to audit by federal, state and foreign tax authorities. We are currently under examination by the Internal Revenue Service for our 2019 to 2021 tax years. There are differing interpretations of tax laws and regulations, and as a result, significant disputes may arise with these tax authorities involving issues on the timing and amount of deductions and allocations of income among various tax jurisdictions. We periodically evaluate our exposures associated with our tax filing positions.

During the three months ended March 31, 2024, our unrecognized tax benefits balance as of December 31, 2023 decreased by approximately $400 million. This reduction was due to the conclusion of a tax audit.