Pfizer seals tax-friendly deal with Allergan
Big pharma player Pfizer has inked its long-rumoured deal to buy botox maker Allergan, in what the BBC describes as “the biggest pharmaceuticals deal in history”
US-based Pfizer and Irish firm Allergan will be combined under Allergan plc, which will be renamed “Pfizer plc.” Upon the closing of the transaction, the combined company is expected to maintain Allergan’s Irish legal domicile. Pfizer will have its global operational headquarters in New York and its principal executive offices in Ireland.
According to The Guardian newspaper, the move represents a significant tax cut for the pharma giant as tax on foreign earnings is far lower than in the US.
“The proposed combination of Pfizer and Allergan will create a leading global pharmaceutical company with the strength to research, discover and deliver more medicines and therapies to more people around the world,” stated Ian Read, chairman and chief executive officer, Pfizer.
“Allergan’s businesses align with and enhance Pfizer’s businesses, creating best-in-class, sustainable, innovative and established businesses that are poised for growth. Through this combination, Pfizer will have greater financial flexibility that will facilitate our continued discovery and development of new innovative medicines for patients, direct return of capital to shareholders, and continued investment in the United States, while also enabling our pursuit of business development opportunities on a more competitive footing within our industry.”
Pfizer says its businesses will also be “significantly enhanced” by the addition of a growing revenue stream from Allergan’s flagship brands in aesthetics and dermatology, eye care, gastrointestinal, neuroscience and urology.
From an R&D perspective, Pfizer will likely gain access to new molecular entities and product line extensions.
Pfizer’s statement confirms: “A combined pipeline of more than 100 mid-to-late stage programs in development and greater resources to invest in R&D and manufacturing is expected to sustain the growth of the innovative business over the long term. Through product approvals, launches and inline performance the combined company aspires to be a leader in growth.”
Brent Saunders, presently chief executive officer at Allergan said: “The combination of Allergan and Pfizer is a highly strategic, value-enhancing transaction that brings together two biopharma powerhouses to change lives for the better. This bold action is the next chapter in the successful transformation of Allergan allowing us to operate with greater resources at a much bigger scale.
"Joining forces with Pfizer matches our leading products in seven high growth therapeutic areas and our robust R&D pipeline with Pfizer’s leading innovative and established businesses, vast global footprint and strength in discovery and development research to create a new biopharma leader.”