Biggest merger this year

These companies are talking about merging which would cap a remarkable consolidation in the U.S. healthcare industry. The deal between the companies  with an expected price way above Allergan's current stock market value of about $120 billion would be the largest corporate merger this year. This would place firms in a huge presidential election debate over efforts by the U.S. companies to obtain lower tax rates. Thinking about this, this would not benefit us at all. The prices of these medications would go way up. The competitions among all of the manufactures would just end due to the merge.

Three of the largest drug store chains announced on Tuesday a 9.4 billion dollar merger, Walgreens, Boots Alliance INC. and Rite Aid Corp. These companies believe that stocking up can help with better financial terms with many healthcare costumers and making sure that the costs of these products do not go up.

This even effects the employees, thinking they want this to happen? Job cuts for employees of each of these companies are on the line. They don't have a say in what is possibly about to happen. Part of the reason this is even being talked about is because this could help lower Pfizer's corporate tax rate. If Pizer moved its headquarters to Ireland while also keeping the U.S.operation this is known as tax inversion. Everyone would see the costs rise due to marketed branded drugs as well as the introduction of new products. Speaking Thursday at Wall Street Journal, Pfizer Chief Executive  Ian Read said the company is at a “tremendous disadvantage” under the U.S. corporate tax code and added Pfizer is competing against foreign companies “with one hand tied behind our back.”

Donald Trump said "These corporate inversions take capital and, more importantly, jobs offshore,"  "We need leadership in Washington to get the tax code changed so companies will be coming to America, not looking for ways to leave." Carl Icahn, who has endorsed Trump plus launched a $150 million political action advocating tax reform to eliminate inversions, said a Pfizer-Allergan deal would result in loss of the country's 10th largest company to Ireland. Pfizer's has a tax rate of 25 percent, while Allergan's has one of 15 percent. Given that both sides said the talks were "friendly," Pfizer is likely to have a much smoother path outside of the United States.

A purchase of Allergan, which has a market value of more than $113 billion, would be the biggest in Pfizer's long history of  deals, toping the $90 billion Warner-Lambert acquisition through which it gained control of Lipitor.This would restore the Viagra maker as the world's largest pharmaceutical company, worth about $330 billion. Allergan expects to have a revenue of more than $8 billion in the second half of 2015.
Pfizer has annual sales of about $48 billion, with about $27 billion from patent-protected drugs, consumer products and vaccines, and about $21 billion from the business it is considering selling.


Citations:
James. "An Allergan-Pfizer Deal Could Be Biggest Merger This Year." Los Angeles Times. Los Angeles Times, 5 Nov. 2015. Web. 05 Nov. 2015.  


  Rockoff, Johnathan D. "Pfizer and Allergan Begin Merger Talks." WSJ. Wall Street Journal, 29 Oct. 2015. Web. 05 Nov. 2015.     


Berkrot, Bill. "Pfizer, Allergan Drug Merger Talks Raise Tax Hackles in U.S." Reuters. Thomson Reuters, 30 Oct. 2015. Web. 05 Nov. 2015.