Sloan Lambastes Pfizer “Inversion” Deal

Allan Sloan, Washington Post journalist and a popular public radio Marketplace commentator, calls Pfizer a “corporate deserter” and says this deal “takes tax avoidance to a whole new level.” He’s referring to the proposed combining of New York-based Pfizer with Dublin-based Allergan PLC, a company that is itself the result of an inversion deal. The Allergan-Pfizer deal will engender another Dublin-based company, with the Pfizer name, which will remain by most objective criteria a U.S. company, with its corporate headquarters in New York. Strictly speaking, on the basis of the fact that Allergen would end up owning slightly more than 40 percent of the combined company, this deal does not meet the definition of an inversion and thus is not covered by restrictions that were imposed last year by the U.S. Treasury Department. “Once people examine the technicalities underlying this deal, other companies may well be inspired to structure their desertions the same way Pfizer has,” Sloan writes. He maintains that shareholders, as well as the U.S. treasury, will pay a price.