After AbbVie (ABBV 0.98%) reported its third-quarter results in October, all the signs pointed to the big biotech enjoying its best year ever in 2017. The company was on a roll.

Investors fully expected that the positive momentum would continue when AbbVie announced its fourth-quarter and full-year 2017 results before the market opened on Friday. Their expectations were met -- and then some. AbbVie yet again knocked the ball out of the park, with shares jumping 6% in early trading. And one number stood out as more important than any other.

Two people in white coats looking at a computer screen.

Image source: Getty Images.

By the numbers

Up, up, and way down -- but with an asterisk. That's the quick version of AbbVie's fourth-quarter numbers.

The big biotech reported revenue of $7.7 billion, an increase of nearly 14% over the prior-year period. This top-line performance was boosted a bit by a favorable 1.5% impact from foreign exchange. As usual, Humira generated the lion's share of AbbVie's total revenue, with sales of the autoimmune disease drug totaling nearly $4.9 billion in the fourth quarter. During the full-year 2017, Humira raked in $18.4 billion, making it the best-selling drug in the world in yet another year.

However, AbbVie's fastest-growing product was Imbruvica. Sales for the cancer drug soared nearly 58% year over year to $708 million. Imbruvica ended 2017 with close to $2.6 billion in annual revenue.

AbbVie announced adjusted diluted earnings per share (EPS) of $1.48 in the fourth quarter, a year-over-year jump of 23%. That result handily topped the consensus Wall Street estimate of $1.44.

But AbbVie's net income for the fourth quarter of 2017 was a puny $52 million. In the same quarter of 2016, the company reported net income of nearly $1.4 billion. This is where the asterisk comes into play, though. While AbbVie's bottom-line performance appears to have significantly worsened, the big drop stemmed from the one-time impact of around $4.5 billion in taxes on cash parked offshore.

This hefty tax payment is actually good news because it means AbbVie was able to bring a lot of money back into the U.S. That money will be spent in several ways, including investing $2.5 billion over the next five years in capital projects in the U.S. and contributing around $350 million to charities in 2018.

Most important number

While AbbVie's fourth-quarter numbers were strong, the most important number announced by the company related to the future rather than the past. AbbVie now projects 32% year-over-year adjusted EPS growth in 2018 at the midpoint of its guidance range.

Previously, the company provided adjusted EPS guidance for 2018 between $6.37 and $6.57. AbbVie raised that guidance to a range of $7.33 to $7.43. Tax reform was the catalyst for the change.

The effects of U.S. corporate tax reform are going to be really positive for AbbVie. The company's GAAP tax rate in 2017 was 95.6%. However, that was skewed by the big repatriation tax, so AbbVie's adjusted tax rate was 18.9%. AbbVie predicts its 2018 effective tax rate will be around 9% as a result of a one-time tax benefit related to the timing of the phase-in of provisions of the new tax reform act for some of its subsidiaries. Over the next five years, AbbVie expects its adjusted tax rate to be around 13%.

Remember that AbbVie operates throughout the world, so its effective tax rates include more than the U.S. However, there's no question that the company will make a lot more money as a result of lower U.S. taxes. If you're an AbbVie shareholder, that's good news.

Looking ahead

AbbVie CEO Rick Gonzalez said at the recent J. P. Morgan Healthcare Conference that the company expects to launch at least 20 new products or indications by 2020. Gonzalez also said that AbbVie expects non-Humira sales (adjusted for risk) totaling $35 billion by 2025. To put that into perspective, combined sales for all of the company's drugs outside of Humira totaled less than $9.8 billion last year.

I have thought for a while that AbbVie was the best big pharma stock on the market. After the company's outstanding fourth-quarter performance and tremendous outlook for 2018, my view has solidified.