Pfizer merging with Allergan: is a move to Ireland in the works?

By Cinch Translations

The healthcare world is going through a major shakeup. Pfizer Inc. has announced that it is merging with Allergan plc, an Irish business better known as the maker of Botox, in a move that would create the largest pharma company in the world.

Valued at $160 billion, the deal is said to be the second-largest merger deal of all time. According to Pfizer, the deal will bring together significant synergies between two businesses ready for the next stage of growth.

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“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, Pfizer Chairman and Chief Executive Officer, in a statement from the company.

“Allergan’s businesses align with and enhance Pfizer’s businesses, creating best-in-class, sustainable, innovative and established businesses that are poised for growth,” he added. “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.” 

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Pfizer and Allergan are doing some fancy footwork within this merger. According to the statement, the companies will be combined under Allergan plc—as though Allergan is acquiring Pfizer—and then the resulting entity will be renamed “Pfizer plc.” This tactic allows the new entity to claim Ireland as its legal home for its executive offices (though Pfizer plans to also retain global operational headquarters in New York). Because of this, the merger is gaining publicity as a tax inversion strategy to avoid paying taxes at higher U.S. business rates.

That’s if the merger is approved—it is still subject to review, and Pfizer was unsuccessful in its previous attempt to acquire UK-based AstraZeneca. If it is approved, the merger should be completed by the second half of 2016. 


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