12:54 GMT13 August 2020
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    In May US pharmaceutical giant Pfizer backed down on the UK's biggest ever takeover bid for AstraZeneca. On November 26, they are eligible to try again however the political landscape has changed since then.

    It would have been the biggest takeover deal in British corporate history.

    The drugs giant Pfizer had been eying up AstraZeneca but withdrew its £55 a share, £69bn takeover bid for the UK's second-biggest pharmaceutical firm at the end of May 2014.

    Pfizer was seen by many as a ruthless operator which snapped up companies and then stripped them of their assets with scant regard for the workers or the companies themselves.

    The most vehement opponents simply saw this prospective deal as making Pfizer's arrangements more tax efficient.

    The plan was to re-domicile the American company to the UK where corporation tax is lower, in a process known as ‘inversion'.

    There was no shortage of critics back then.

    One of them was American journalist based in the UK, Bonnie Greer.

    She said: "Pfizer has a pretty horrible track record in terms of what I guess you'd call rationalising the work force. They've cut jobs and they closed down a plant in Sandwich which they promised to keep open."

    Pfizer tried to allay these concerns. Its chairman, Ian Read, gave a five-year pledge on UK jobs and facilities, promising to complete an AstraZeneca research centre in Cambridge as well as keep a factory open in Macclesfield, Cheshire.

    But many saw these promises as vague, Bonnie Greer among them: "They've given us five years in which they've said they'll keep things as they are but of course five years is the time that it will take for them to relocate, rationalise their work force and do the stuff they have to do in the USA.

    "Then they do their work over here which is usually slash and burn."

    In the end, that deal which British unions, scientists and many politicians opposed, fizzled out.

    This week, Allan Sloan of the Washington Post described the attempted take-over, in a Thanksgiving-themed critique as ‘the biggest turkey' of 2014.

    "Not only didn't Pfizer get to buy AstraZeneca, which didn't want to be acquired, but the inversion attempt by a household-name company like Pfizer woke up lots of people to what had been a slow but steady erosion of the U.S. corporate tax base by companies moving offshore," he said.

    After the failure of the deal, there was a six-month "hands-off" period.

    But this expires on November 26, after which Pfizer might make another attempt, at least that is the view of the influential fund manager Neil Woodford, who is a long-term investor in AstraZeneca.

    He told The Guardian that there was a '50-50' chance that Pfizer would bid again, even though it was in AstraZeneca's interests to turn any such offer down.

    "At the time of the initial approach from Pfizer, we strongly believed that an independent AstraZeneca would achieve far better returns for its shareholders than the offer from Pfizer could have delivered. 

    "That remains the case, although six months on, our confidence in this belief is even stronger and the progress being made by the company is tangible."

    Meanwhile, ahead of a possible re-opening of a bid process, AstraZeneca  has been boasting about its success in the field of research.

    Chief executive Pascal Soriot and other executives briefed analysts and investors on the company's prospects.

    This week, it brought forward the filing date of a new lung cancer pill, which it has described as ‘industry leading'.

    It also hopes to get between eight and 10 new drugs approved within the next two years across all disease areas, with 14 medicines going through their final stages of testing.

    He said he and his team were "more confident than before" in AstraZeneca's ability to generate more than $45bn (£29bn) in revenues by 2023.

    If Pfizer did try again, it would come at considerable risk.

    The Guardian's finance editor Nils Pratley says Pfizer's management may be looking in other directions.

    For instance, the US firm paid $850m for rights to a cancer immunotherapy drug being developed by Merck.

    He also pointed out the career-risk in making another tilt at AstraZeneca.

    "Pfizer boss Ian Read's credibility would be shattered if he failed twice to pull off the same mega-deal. Nor can Read know how intense the UK political heat would be this time — except that for the next few months, in the run-up to a general election, it would be red-hot."

    Pfizer is the world's second biggest pharmaceutical company and AstraZeneca, the seventh largest measured by prescription sales. 

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