What does Pfizer's merger mean for drug development?
During the past 15 years, Pfizer has cumulatively spent US$230 billion to buy up big drug developers including Warner Lambert, Pharmacia, Wyeth, and Hospira. At the end of 2015, Pfi zer struck again, announcing plans to merge with Allergan, the maker of botox, in a $160 billion deal. The transaction, the biggest in the history of health care, is set to make Pfi zer the world's largest drug company by sales. The main driver behind the deal, say analysts, was Pfizer's desire to reduce its tax exposure. Whereas the company headquarters are currently in New York, NY, USA, Allergan is currently based in Dublin, Ireland. Pfi zer, as a result of the merger, will move its corporate headquarters to Ireland, where it will face a lower tax rate. Pfi zer's current tax rate is around 25% but will drop to below 20% after the deal closes, saving the company billions of dollars. In 2014, Pfizer made a similarly huge but ultimately rebuffed bid to buy UK based AstraZeneca to achieve tax savings.
The Lancet