Pfizer set to merge with Allergan in $150bn deal

US drug giant Pfizer is set to acquire Allergan in a deal reported to be worth in excess of $150bn (USD) (£99bn). The merger, announced this morning, will create the world’s largest pharmaceutical company.

While Allergan is best known for its botox treatment, its ophthalmic portfolio includes treatments for dry eye, glaucoma, macular oedema and anti-inflammatories.

The Wall Street Journal reports that the deal will be structured as a ‘reverse merger,’ with Dublin-based Allergan buying Pfizer, enabling the New York pharma giant to move its base to Ireland and reduce its tax rate to 20%.

A similar deal had been thrashed out last year, with Pfizer’s attempts to buy out Astra Zeneca for almost £70bn, falling through after protest from Astra Zeneca’s board and involvement from Westminster.

Allergan has gone through a succession of mergers and acquisitions in recent years, fending off an aggressive takeover bid from Canadian firm Valeant.

In 2014, the drug maker made substantial cuts in the US, axing 1500 jobs in an attempt to save $475m (£313m). The firm was subsequently taken over by Irish firm Actavis in November 2011, keeping its original name.

In addition to the tax break for Pfizer, the latest deal could see the new super firm benefit from Allergan’s drug pipeline.

According to the Wall Street Journal, Allergan could launch ‘more than a dozen’ products, including treatments for macular degeneration and depression, which could drive more than $15bn (£9.9bn) in sales.

Reuters reports that Pfizer’s current chief executive, Ian Read, will head the new company, while CEO of Allergan, Brent Saunders, will take a “very senior role focused on operations and the integration.”