Drug merger aimed at more medicines: CEOs

The Guardian (Charlottetown) - - BUSINESS -

TREN­TON, N.J. — The heads of drug­mak­ers Pfizer and Al­ler­gan said Tues­day that the record $160 bil­lion com­bi­na­tion they're plan­ning is meant to pro­duce more medicines and boost rev­enue, not to just slash jobs and other costs as the com­pa­nies pre­vi­ously have done. The deal an­nounced last Novem­ber would move Pfizer's of­fi­cial head­quar­ters for tax pur­poses from New York to Al­ler­gan's base in Ire­land. The strat­egy, called a tax in­ver­sion, would sharply de­crease Pfizer's in­come tax bill com­pared to cur­rent U.S. tax rates, though the drug­maker's op­er­a­tions would still be run from New York. Pfizer has a his­tory of mak­ing such huge ac­qui­si­tions of other drug­mak­ers, then clos­ing some fa­cil­i­ties and elim­i­nat­ing thou­sands of jobs to boost profit quickly, though usu­ally just tem­po­rar­ily. Over the last 15 years, along with many smaller ac­qui­si­tions, Pfizer has gob­bled up Top 20 drug­mak­ers Warner-Lambert, Phar­ma­cia and Wyeth, pay­ing $68 bil­lion for Wyeth alone in 2009.

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