Pfizer takeover bid: government ‘has looked at merger rules’ on science

But Cable warns that intervention options are constrained by law

May 13, 2014
Holly Else

The government has looked at expanding the public interest test on mergers to include scientific research and development, Vince Cable has told a cross-party group of MPs.  

Mr Cable, the business secretary, told the House of Commons Business, Innovation and Skills Committee today that it was “one of the options” the government had looked at as he was asked about US pharmaceutical company Pfizer’s proposed takeover of AstraZeneca.

However, he added that this would need to be done within the constraints of the existing legal framework.

When asked by MPs whether the upcoming Parliamentary recess would affect any ability to act, Mr Cable said his understanding is that it would not, because the bid would be “live” for some time.

Mr Cable added that the government is looking for assurances from Pfizer of a long-term commitment to research and development, employment, manufacturing and decision-making in the UK.

He added that Pfizer’s pledge to keep 20 per cent of its research and development workforce in the UK is a “basis for negotiation” and if conversations were to continue they would need to be “meaningful and binding”.

When asked how he would make these assurances meaningful and binding, Mr Cable said this was an area he would “rather not expose in too much detail”.

His appearance before the committee came after the chief executives of both Pfizer and AstraZeneca appeared before the same group of MPs.

Pascal Soriot, the head of AstraZeneca, warned that if the takeover went ahead it would create a huge “distraction” that would threaten to undermine development work being done by the firm’s scientists.

“Any distractions on work we are doing now could run the risk of delaying our drugs pipeline,” he said.

Meanwhile, Ian Read, chief executive of Pfizer, insisted that the proposal would be good for UK science. “I think it will strengthen the scientific base in the UK, a company our size making these sorts of commitments,” he told the MPs.

holly.else@tsleducation.com

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Reader's comments (1)

#1 Submitted by johnkelly92 on May 13, 2014 - 6:30pm
Vincent Cable's reinsert to the Select Committee doesn't adequately deal with the threat to our research intensive universities. When Swedish company Pharmacia merged with Upjohn in 2002 it was effectively taken over and Upjohn made the big decisions in the US, including favouring US universities for investment in Research. Fortunately for Swedish universities they still had Astra - well until it moved to the UK, albeit with strong Swedish influence in the governance and management. There is every reason to expect that Astra will eventually disappear as Pharmacia did. Harvard, Michigan and others can expect to benefit at the expense of UK and Swedish universities.

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