Since AstraZeneca turned down Pfizer’s latest takeover approach, opponents have been airing their concerns on whether it would be in the UK’s interests if a deal went through.
Labour leader Ed Miliband has written to Prime Minister David Cameron who has spoken to Pfizer chief executive Ian Read and is perceived to be broadly supportive of the proposed pact. Mr Miliband states that “the impression created in recent days has been of a Government cheerleading for this deal on the basis of a short letter with inadequate assurances”.
He added that “I am strongly of the view that, when it comes to such a strategically important part of UK PLC, we need a more substantive assessment of whether this takeover is in the national economic interest before the UK government allows itself to be seen to be supporting it”.
Mr Miliband goes on to express his concerns about Pfizer’s track record in the UK, including the decision in 2012 to close down the R&D facility in Sandwich, leading to the loss of 1,500 jobs. He also notes that AstraZeneca currently spends “a significantly higher proportion of its turnover on R&D than Pfizer – a crucial concern given the importance of pharmaceutical investment in R&D to the UK science base”.
He added that a clear assessment “would provide elements of the transparency and information that a wider public interest test would involve. _It would also be in Pfizer’s interest if their commitment to the UK’s science base is as strong as they insist”. Mr Miliband concluded by saying: “It is only after such an assessment has been made that a British Prime Minister should decide whether to support such a bid – not by staging quick backroom conversations with one party to a deal”.
‘Ownership irrelevant’
A number of politicans have lined up to express concern but Sir Richard Sykes, the highly-respected chairman of the Royal Institution and former boss of GlaxoSmithKline, wrote in a Financial Times article, that “ownership is irrelevant”.
He goes on to say that “In essence it does not matter where a global company’s headquarters are. What is really important is that Britain encourages these companies to do their drug discovery and development work here. To me that is the critical issue and we should learn lessons from the Indian and Japanese carmakers that have followed this model”.
Sir Richard adds that “iIn doing so companies such as Pfizer, if they are as good as their word, can catalyse an already-clear trend that is making the UK one of the best places on earth to do groundbreaking R&D in the life sciences”.
In any merger ‘severe cuts are made’
The fear of job cuts despite Pfizer’s assurances to the UK government is a genuine one, according to John LaMattina, former president of Pfizer Global R&D. Writing for Forbes, he said that “for the R&D folks in both companies, this news has got to be worrisome”, noting that “first of all, in any such merger, severe cuts are made across the whole company. Whether you call them ‘synergies’ or elimination of “redundancies”, it means the same thing: billions of dollars in cost savings will be wrung out of the merged entity to help meet the targets that were set to justify the payment of over $100 billion to acquire AstraZeneca”.
Dr LaMattina argues that to accommodate Mr Read’s promise of putting key scientific leadership in the UK to run global functions, “new people will be appointed to new positions and new relationships will need to be built”. He concluded by saying “right now, my guess is that people in both organizations are talking a lot less about science. Rather, they are speculating…about their futures. Will I have a job? Will I have to relocate? Will my project be eliminated?”
FDA approves Epanova
Away from the speculation, meanwhile, regulators in the USA have given the green light to AstraZeneca’s Epanova. The coated soft gelatin capsule containing a mixture of polyunsaturated free fatty acids derived from fish oils, has been approved for patients with severe hypertriglyceridemia.
Briggs Morrison, chief medical officer at AstraZeneca, said the approval is a significant milestone, saying the firm will be “further assessing the clinical profile of Epanova and identifying other patient groups it may benefit”. It will go up against fish oil drugs which are already available, GlaxoSmithKline’s Lovaza and Amarin’s Vascepa.
