Business Irish

Thursday 19 September 2019

Pharma firm paid out $7bn dividend but no Irish tax

Botox maker's unit managed in Bermuda

Product: Forest Laboratories Holdings’ parent company Allergan makes Botox. Photo: Bloomberg
Product: Forest Laboratories Holdings’ parent company Allergan makes Botox. Photo: Bloomberg

Gordon Deegan

A Dublin-based subsidiary of Allergan, the Irish-domiciled maker of Botox, last year paid out dividends of $7bn (€6.33bn).

New accounts filed by Forest Laboratories Holdings Ltd reveal the scale of the dividend payout across a number of payments in 2018.

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The firm has no employees and Forest Laboratories Holdings paid no corporation tax on its profits here last year. 

A note attached to the accounts states that "the company is managed and controlled in Bermuda. No charge to Irish corporation tax arises as the company is not resident in Ireland for tax purposes and did not have any Irish source of income."

The directors' report shows that a $6bn dividend was paid out in August of last year and three further dividends totalling $1.085bn were paid out during the year in sums of $715m, $180m and $190m.

The Forest Laboratories holding firm is the intellectual property owner of certain pharmaceutical products and owns the manufacturing rights and distribution rights for certain markets, primarily North America.

The firm - which has its registered office at Clonshaugh Business and Technology Park in Dublin - last year recorded a 41pc increase in pre-tax profits to $935.35m.

This followed a 17pc increase in revenues to $1.65bn from $1.4bn.

The directors said that "sales to the market of mature products remained strong throughout the year".

The profit last year takes account of non-cash amortisation costs of $240.45m and Research & Development costs of $107.16m.

A subsidiary, Forest Laboratories Ireland Ltd manufactures pharmaceutical products here and last year it recorded pre-tax profits of $16.4m - a 53pc drop from the $35.45m recorded in 2017.

The firm's revenues last year declined by 32pc to $221.2m from $329.18m and the directors said that during the year "the company continued with strong output performance in both commercial and development product activities contributing significantly to Allergan plc's top line revenue number".

The workforce at the business last year declined to 226 from 253 as staff costs increased from $20.19m to $22.74m.

Actavis - now Allergan - completed the purchase of Forest Laboratories in a deal valued at $28bn in 2014. 

Earlier this year, US drugmaker, AbbVie agreed to purchase Allergen in a $63bn deal that means AbbVie and Allergan will have combined sales of more than $48bn.

Separate accounts for a connected firm in the Allergan group, Allergen Botox Unlimited Company show that in March of this year, the firm declared a dividend of $1.18bn to its parent, Allergan Pharmaceuticals Holdings (Ireland) Unlimited Company.

Irish Independent

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