Let's Congratulate Pfizer On The Birth Of Its New Baby Tax Rate
an inversion by any other name
Merry Black Friday, America! Don't forget what's hot this season:
In: Stupid watches. 9/11. Adele.
Also Always In: Pills. Lots and lots of pills. Or so say us and our friends at Big Pharma.
Pfizer hopes to find pot of tax gold at end merger
Hey Pfizer, what's good? Gonna merge with Irish drug maker Allergan, become an Irish citizen, and be all 'Fer feck's sake, Uncle Sam. we're not gonna pay yer taxes ya feckin bastards. kiss mah blarney stones'?
Earlier this week, Pfizer announced it's going forward with plans to merge with Allergan and move to the Republic of Ireland Brought To You By Bono. How did this happen? Well, kids. When two Corporate Persons love each other but mostly love money and their shareholders, one company's lawyers and executives penetrate another company's board room. After 9 months or so of ensuring government and shareholder approval, out pops a merged corporation. Which Corporate Person will the new Merge Baby look like? Well in this case, the new Corporate Person is likely to have Pfizer's name but Allergan's 12.5 percent Irish tax rate.
Congratulations to the proud parents on the impending birth of your Big Pharma baby, an industry-record setting 106 billion pound ($160 billion dollar) new kid.
Pfizer toiled for years under the yoke of an oppressive 26 percent American tax rate, only managing to secure $9.1 billion in 2014 net income. We certainly can't expect this company -- started 150 years ago by German-American immigrants -- to maintain any sort of corporate patriotism when Allergan paid a 5 percent tax rate over the same period. You would do the same thing if you weren't too busy watching cat videos and not being a gigantic pharmaceutical corporation.
But this move isn't merely to secure future earnings and tell America, "thanks for the memories." These dickbags have buried treasure they need to excavate. There's gold in them there overseas accounts!
Pfizer kept overseas $74 billion in profits that were earned abroad last year, because bringing them home would have racked up billions of dollars in taxes.
SOME might call this a merger of tax convenience for the tax-dodging company. But SOME are just looking at the facts and not listening to Pfizer CEO Ian Read. Because losing this Corporate Person to the Emerald Isle in a shameless money-grabbing scamper to beat the glacial pace of change desired by some upset legislators and regulators is ACTUALLY a good thing for us:
The New York Times reports that CEO Ian Read called the Obama administration and argued that the merger “would significantly cut Pfizer’s tax bill and give it more cash that it could invest in the United States and ultimately add jobs.”
Sure, Pfizer could invest in the American workforce. It could bring more research and development to the States. It could turn back time and take back those words that hurt you. Or it could hire simpering gombeen Eric Cantor to smooth things over with former colleagues long enough for the merger to be finalized.
Yeah, definitely that last one, ayup.
Novartis caught bullying people to do more drugs, kind of gets punished
While We The People lose billions to Pfizer, don't fret. Millions are coming back from Swiss Corporate Person Novartis. Win some, lose a lot more.
Novartis was looking at $3.3 billion in fines for using its influence over patient referrals (and also bribes) to strong-arm pharmacies into encouraging patients to refill drugs they didn't need. This includes Exjade, a drug that lowers blood iron but can also cause some pretty rough side effects maybe related to blood regulation. We don't know, we only play doctor, we're not really doctors.
Thanks to a whistleblower, this widespread fraud, which ran from 2007 to 2012, was uncovered and brought to the attention of authorities who previously settled with the specific pharmacy culprits. While Novartis did $57 billion in sales last year, we're sure the measly $390 million settlement will deter future malfeasance, or so says self-congratulatory US Attorney Preet Bharara:
"Drugmakers and their relationships with health care providers - whether they are doctors, pharmacists, or nurses - must comply with the Anti-Kickback Statute. If they don't, we will bring all appropriate law enforcement tools to bear."
And "all appropriate law enforcement tools" includes eschewing painful litigation and settling with the big bad drug company for a fraction of the original fine. Imagine if you protested a speeding or public urination ticket and the authorities dropped the fine by 90 percent. You would walk out of that administrative court with arms raised, a tear streaming down your cheek, triumphant and emotional as Daniel Day Lewis in "In The Name of The Father."
We guess if the punishment doesn't fit the crime, just move the appropriate goal posts. Good job, good effort. Happy holidays!