Pfizer-Allergen Merger Now Investigated By US Anti-Trust Officials

Pfizer and Allergen might have not reached completion like hoped; this merger is now being investigated by the antitrust officials of the United States.

Pfizer is not getting the easy way out of US taxes, as Allergen Plc merger is now a matter of investigation by the antitrust officials. The drug maker company might have to provide the antitrust with more information regarding the merger that is worth $300 billion.

The pharmaceutical company and Allergen decided to tie the knot in past November making it one of the biggest deals ever. This deal was an inversion transaction transferring the company’s address into Ireland, since Allergen is situated there. This would lead it to avoid the huge US tax bills around 17% to 18% instead of the current 25%. This is not the only thing US is concerned about but even the fact that many jobs will be ripped away from the State if this happens.

The FTC (Federal Trade Commission) has issued another request to both the companies involved in the deal for further information to review, according to a statement on Wednesday. Both organizations will be working together and showing corporation to the FTC for the review to go on efficiently. The deal between the drug maker and the Botox maker reached an agreement a year ago worth $160 billion. The antitrust officials will also be reviewing for overlaps in the companies portfolios.

The review of portfolios might lead to problems for both companies, as it would even see for unfair advantages, if any, on the rivals. These companies might even have to divest products that are concluded to be a threat to the rivals by the officials. The FTC filed this deal on February 29 for a 30-day review, later it filed a second request. The second request stated that the FTC wants to conduct a detailed investigation regarding the merger.

Pfizer Inc. and Allergen Plc’s deal now lays at the mercy of the FTC. No predictions can be made as to what is really going to happen now. It is also waiting for the Botox maker to sell one of its generic drugs to Teva Pharmaceuticals. This is not the only hurdle faced by the merger now but it also awaits the approval of shareholders.

Pfizer stock was reported to decline by 6.6% right after the company announced the deal, which raised the concerns of investors. Even Allergen shares declined by 12% after the merger were made public.

Pfizer is not going to get its way out of the United States as easily as it had hoped. This merger has been a victim of criticism for a very long time. Now the matter belongs to the officials, with both companies keeping their fingers crossed.