David Davis call for Pfizer’s bid to be referred for a public interest test

As published in the Guardian:
Pfizer-AstraZeneca deal would fail public interest test, says senior Tory

David Davis says suspicion remains that US drugs firm is primarily interested in reducing its tax bill

A senior Tory has called for the attempted £63bn takeover of the drugs firm AstraZeneca by its US rival Pfizer to be subject to a public interest test.

David Davis, a former minister and Conservative leadership candidate, said he did not believe the deal would pass such a test as it seemed to revolve around the lowering of Pfizer’s tax bill.

He told the Times: “If such a test were applied in this case, then I believe Pfizer’s bid would fail. It doesn’t have a great track record in honouring its undertakings and the suspicion remains it is primarily interested in reducing its tax bill.”

Other backbenchers have urged David Cameron to avoid interfering in the deal to preserve Britain’s reputation for allowing businesses to operate in a free market.

Meanwhile, it emerged that the Labour leader, Ed Miliband, turned down a request for a meeting with Ian Read, the Pfizer chief executive. The BBC’s Newsnight reported on Thursday that Miliband’s office replied saying he would be too busy campaigning, although it is understood he is now trying to find time.

Labour has expressed scepticism about the deal, with Miliband calling for a new public interest test to protect UK research and development. He has urged Cameron to seek better assurances from Pfizer, and accused the prime minister of being a cheerleader for the takeover, which critics fear could lead to job losses and the erosion of Britain’s research base.

The Lib Dem business secretary, Vince Cable, has said the government would not let Pfizer use the UK as a tax haven, and promised to secure British science jobs.

As published in The Times:
Divided Tories anxiously await Pfizer’s next move

David Davis became the first senior Tory to call for the bid to be referred for a public interest test

David Cameron was pulled in opposite directions by Tory MPs yesterday as he waited anxiously for Pfizer’s next move in its bid for AstraZeneca.

The prime minister was forced to insist he wanted more assurances from Pfizer after Labour accused him of acting as a cheerleader for the US firm in its battle against the British company.

David Davis became the first senior Tory to call for the bid to be referred for a public interest test, warning Mr Cameron not to risk giving the impression that he was taking sides. However, other Conservative MPs told the prime minister not to bow to pressure from what one termed “spineless pandering to dangerous socialist populism”.

The government is waiting for the US drug-maker’s next move after its £63 billion bid was rejected by AstraZeneca. Ministers expect Pfizer to make an improved offer or deliver additional reassurances about British jobs and research facilities before its chief executive, Ian Read, appears before two Commons committees next Tuesday.

Mr Davis, a former Tory leadership candidate and business executive, said he would support Vince Cable, the Lib Dem business secretary, if he ordered a formal assessment of whether the bid was in the national interest. “If such a test were applied in this case, then I believe Pfizer’s bid would fail,” Mr Davis said. “It doesn’t have a great track record in honouring its undertakings and the suspicion remains it is primarily interested in reducing its tax bill.”

Mr Davis did not directly criticise Mr Cameron’s handling of the proposed takeover, but said the need for neutrality was paramount. “Governments must also do all they can to avoid the impression they are taking sides.”

However, Tory MPs on the Free Enterprise Group urged Mr Cameron to resist those, like Ed Miliband, the Labour leader, calling for a public interest test. Dominic Raab, the MP for Esher and Walton, said: “For Vince Cable to suggest the UK ‘public interest’ test might be wielded to block this takeover is spineless pandering to dangerous socialist populism — he knows it only applies in national security, media and banking cases.

“He should be pointing out that Ed Miliband’s dangerous flirtation with Venezuelan-style economic Chavismo threatens jobs, investment and long-term British competitiveness.”
Kwasi Kwarteng, convener of the group, said: “The plan of the government was to reduce corporation tax so we could make Britain more attractive to business. We can’t then, having pursued this policy, cut ourselves off at the knees by erecting all sorts of barriers to how that foreign capital operates.”
However, it was “fair enough to look at some sort of safeguards”.

Steve Baker, elected this week to the Treasury select committee, warned ministers against “a lapse into protectionism”. It was important to have the “courage of our convictions to say we will stand for free enterprise”, he said. “The reason I believe in a market economy is it’s the best way to discover what is in the public interest. I don’t think there is a great deal of point in asking for guarantees. No one knows what lies ahead.”