the Voice of
The Communist League of Revolutionary Workers–Internationalist
“The emancipation of the working class will only be achieved by the working class itself.”
— Karl Marx
Jan 4, 2016
Pfizer, the pharmaceutical giant, is on the eve of buying its competitor Allergan, for the small sum of $160 billion!
The merged company would be the biggest pharmaceutical maker in the world, ahead of Novartis, the Swiss company. Pfizer, with $50 billion in sales, is known for Viagra, while Allergan, with $13 billion in sales, is known for Botox.
It’s said this merger will give the company new means to develop its research and maybe discover new medicines, which could be a real therapeutic advance. But this isn’t the main problem for the directors and stocks owners of both companies, who put together the merger so the new company would pay the least taxes.
So while Pfizer is by far the bigger of the two companies, Allergan will exchange one of its shares for 11.3 Pfizer shares and cash. As a result, the Allergan stockholders will own 45% of the capital of Pfizer and the new company will become, on paper, an Irish company. Its headquarters will be in Dublin, allowing it to benefit from a 12.5% tax on corporate profits, while in the U.S. the official rate is 35%. But the CEO of Pfizer will be the CEO of the new company. According to Barclays Bank, this merger acquisition will save the company 1.4 billion dollars a year.
The capitalists of the pharmaceutical sector have no need to envy other companies when it comes to seeking maximum profit!