Actavis plc, which is technically an "Irish company" following the transfer for tax purposes of its headquarters to Dublin in 2013, but remains a US firm in real-world-terms, on Monday announced a $66bn deal for Allergan Inc, the maker of Botox, the skin cavity filler.
Actavis was known for its generic drugs, but last year it bought the smaller Warner Chilcott, an Irish provider of branded treatments for gastrointestinal and urological conditions, and this is how it became Irish:
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Allergan has about 900 employed at its Irish facilities in Westport, County Mayo.
The combined company would sell a range of eye, skin and stomach drugs, led by the well known brand Botox. The company would have $23bn in sales in 2015, more than 30,000 employees and a market capitalization of $128bn, about 12 times Actavis’s equity value just two years ago.
This takeover is going to add to the distortions in Ireland's national accounts.
The Wall Street Journal says Actavis’s entry into the ranks of Big Pharma will come at a hefty price for the company, its many employees and US tax coffers. To reach its financial targets, Actavis plans to cut at least $1.8bn in costs, including $400m in research spending. That doesn’t include $475m in costs Allergan already planned to cut since it came under pressure from hostile suitor Valeant Pharmaceuticals International Inc.
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