Pharma giant Pozen to relocate to Ireland
US pharma company Pozen has announced that it is moving its headquarters to Ireland after buying a Canadian rival in a deal worth $146m.
Shares in the speciality drugmaker, which so far has struggled to get its cardiovascular drug approved, jumped by as much as 26pc after the announcement. The deal will shift its domicile to Ireland and cut its tax bill.
The firm does not sell any products on its own, getting all of its revenue from product royalties and license payments.
The two companies, which had combined turnover of about $50m last year, will combine under the title of a new parent firm Aralez Pharmaceuticals PLC.
The move to Ireland will allow the firm to benefit from lower corporate tax rates. The US has the highest statutory corporate tax rate in the OECD, a combined rate of about 39pc when taking into account federal and state taxes compared to Ireland's 12.5pc.
Pozen said that Aralez has received $350m in financing from a group of investors, including up to $200m in funding for future deals.
Adrian Adams, Pozen's CEO who will lead the combined company, said that he expects that the deal will "enhance our offerings while providing significant benefits for all of our stakeholders."
The company also added that its new Irish domicile would help to "set the stage for sustained long-term growth, both organically and through acquisitions".
There have been several high-profile pharmaceutical deals completed over the last number of years with the aim of taking advantage of Ireland's corporation tax rate.
Towards the end of 2013 US drugmaker Perrigo bought Elan for $8.6bn in December, lowering its corporate tax rate from 30pc to about 20pc while more recently Medtronic became Ireland's largest business after it's $49.9bn acquisition of Dublin-domiciled surgical supplies group Covidien.