Viagra + Botox = Biggest Drug Company Anywhere, Anytime

November 24, 2015

In recent years, there has been a tremendous increase in mergers and acquisitions in the health care sphere. Since Obamacare has started to change incentives in healthcare, hospitals have been joining together and buying up outpatient and primary care clinics to form massive health systems. In the process, they've changed the way Americans access healthcare. And this hits pretty close to home: within just one year, Jefferson has undergone a merger with Abington Health and signed a letter of intent with Aria Health.

M&A has become a big deal in other sectors of healthcare as well - including the pharmaceutical industry. This past weekend, Pfizer Inc (which makes, among other things, Viagra and the pneumococcal vaccine Prevnar), and the Irish company Allergan Plc (which makes Botox), decided to combine forces in a record $160 billion deal. This deal is unprecedented: it's the largest acquisition deal in any industry this year, the largest pharmaceutical acquisition in history, and it creates the largest pharmaceutical company in the world. It's also interesting in that it's an inversion deal, meaning that the smaller company (Allergan) will technically be buying its much larger partner, Pfizer. Why? So Pfizer can relocate its tax address to Ireland, and avoid the US's much higher corporate tax rate.

Article: Pfizer and Allergan to Combine With Joint Value of $160 Billion