The uproar in the U.K. over Pfizer's proposed megamerger with AstraZeneca ($AZN) continues unabated as the British Prime Minister and other politicians of all stripes suggest various means to hold Pfizer's feet to the fire on its promise to preserve the pharma giant's big R&D operations in Britain. But thousands of other jobs are up for the chopping block in Sweden and the U.S., where the Financial Times' correspondents are having a hard time finding politicians willing to jump the partisan divide to stop the deal.
Pfizer ($PFE) has made it clear that it plans to use a big chunk of its overseas cash--quarantined from the U.S. tax man--to complete a deal that would move the combined company's domicile to the U.K., where corporate taxes are relatively low. That would seemingly create an issue for lawmakers in DC. But you won't find it on the radar screens among many U.S. pols, who find it hard to agree on much of anything these days, as exhibited during the recent partisan debate over the country's minimum wage.
"In the old days, if a U.S. company announced they were going to exploit the law like this, the heads of the tax-writing committees in the House and Senate would have issued a one-line statement saying they would take action," one unnamed "senior accounting executive" tells the FT. "But it is all but impossible to pass legislation these days."
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| U.K. Prime Minister David Cameron |
It's clearly a political issue in the U.K., though, as the Labour party jumps in to score points against the government of David Cameron.
"The most important interest [we have] is to back British jobs, British science, British R&D; ... that is why I asked the cabinet secretary and senior ministers to engage with both companies right from the outset," Cameron told MPs, according to a separate report in the FT. "What you get [when you don't engage] is abject surrender."
Outside observers, though, have noted that despite the hubbub over this story, the U.K. has a history of permitting these big deals to go through. If all the country needs from Pfizer are more reassurances about R&D jobs, those are easily come by. Pfizer can build the proposed new research center in Cambridge without sweating the costs, and plenty of other places around the world can supply the necessary near-term cuts to make this deal work.
Just don't expect to hear much debate about it in Sweden or the U.S., where Big Pharma R&D has been on the chopping block for years now.
- here's the story from the FT on the U.K. debate
- here's the story from the FT about the nondebate in the U.S.