AZ ‘consulted first’ by UK government after Pfizer bid
pharmafile | May 12, 2014 | News story | Manufacturing and Production, Medical Communications, Research and Development, Sales and Marketing | AstraZeneca, George Osborne, Pfizer, Wellcome Trust, david cameron
UK prime minister David Cameron has rejected claims that his government is prioritising discussions with Pfizer over its proposed acquisition of AstraZeneca.
“Ministers were talking to AstraZeneca before anyone spoke to Pfizer,” he said in a recent BBC interview. “Clearly the best thing is to engage early on and get stuck in and make sure we get the best deal for Britain. We have made progress.”
Pfizer has already appealed directly to Cameron, promising to retain significant manufacturing operations in Macclesfield, as well as headquarter its European business and regulatory functions in the UK.
The firm has also said it will locate 20% of merged R&D activities in Britain if a deal goes through.
However, these measures are guaranteed only for ‘a minimum of five years’, prompting parliamentary opposition and Labour leader Ed Miliband to dismiss Pfizer’s assurances as ‘not enough’.
Pfizer chief executive Ian Read will appear before two separate House of Commons select committees this week to face further questions about his firm’s intentions.
Despite this grilling of Read, the extent to which the government is willing to intervene in the deal remains unclear. When asked if Whitehall should ‘pull up the drawbridge’ on the proposed acquisition, Cameron responded: “I don’t think there is a drawbridge to pull up.”
Merger worries
Various figures in the British scientific community have voiced concern about the long-term impact of a possible deal on the UK’s research landscape.
Earlier this month, former AZ chief executive Sir David Barnes warned against the merger, saying that he had ‘great concern’ that the American pharma firm would “act like a praying mantis and suck the lifeblood out of their prey”.
More recently, in a letter to UK chancellor George Osborne, medical research charity the Wellcome Trust suggested that the acquisition of AZ by Pfizer could curb R&D activity in Britain and lead to significant job losses.
Alarm over a possible deal stems largely from Pfizer’s recent track record of high-profile acquisitions – and in particular its $68 billion buyout of Philadelphia-based Wyeth in 2009.
As Pharmafile contributor and former Pfizer R&D head John LaMattina points out in a recent blog post, the deal had a drastic impact on merged R&D spend. The year before the acquisition, both companies spent a combined $13 billion on research. By 2013, Pfizer was spending just slightly more than half that amount.
FiercePharma also reports that since the Pfizer-Wyeth merger, a combined workforce of nearly 130,000 has been axed by around 40% – constituting almost 52,000 job cuts in 7 years.
AZ has been largely unreceptive to Pfizer’s advances, with the firm stating that Pfizer’s bid of more than $100 billion ‘very significantly undervalued’ the company.
Hugh McCafferty
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