SAN FRANCISCO (CN) – Pharmacies that buy their drugs from Pfizer and Wyeth, two of the world’s largest drug makers, say in an antitrust action filed in federal court that the companies’ proposed $68 billion merger would give the new combine a 40 percent market monopoly, cost thousands of jobs, and lead to low quality drugs at high prices
In January 2009, Pfizer and Wyeth announced a $68 billion merger agreement, the largest big pharma and biopharma merger in world history.
Pharmacies that buy drugs from Pfizer and Wyeth say that if the two are allowed to combined, it will result in the loss of at least 22,000 jobs and will give the new entity the muscle to sell low quality drugs of a limited selection, says the complaint filed on friday. The merger would also smother innovation and research.
What’s worse, the pharmacies say, is that four of the five financial institutions providing $22.5 billion in loans to facilitate the merge are recipients of about $120 billion collectively in Troubled Asset Relief Program funds from the government.
The banks include Citigroup, Bank of America, Goldman Sachs, and JP Morgan Chase.
“By buying Wyeth, Pfizer will mutate from a manufacturer of blockbuster pills to a one-stop shop for vaccines, biotech drugs, traditional pills, and non-prescribed products,” the complaint said.
Pfizer’s CEO, Jeff Kindles, said of the merger, “In one single transaction, the combination with Wyeth advances every single one of (our) strategies.”
The pharmacies claim the companies’ merger would be a violation of the Clayton Act and the Sherman Act.
They are represented by Joseph Alioto.