Where does Pfizer spend its money on Capitol Hill?
As Pfizer looks across the Atlantic in a renewed bid to acquire United Kingdom-based AstraZeneca, the pharmaceutical giant has its eye on the billions of dollars it could save in taxes if the deal goes through. On Capitol Hill, the company has worked to exercise its considerable influence on the issue of corporate taxation and tax reform.
Although the pharmaceutical company lobbies Washington heavily on various health issues, taxes – and specifically corporate taxation – come in at a close second. Lobbying disclosure reports show that, in the first three months of 2014, Pfizer spent $3,530,000 lobbying on many topics, including health care, drug safety and taxes.
Of that total, Pfizer doled out the lion’s share – almost $3.2 million – to its in-house team to work on a variety of issues. But the company also paid two outside firms a total of $100,000 solely to lobby on taxes.
The Washington Tax & Public Policy Group got $70,000 for three months’ worth of lobbying work on international tax and corporate tax reform, as well as the EXPIRE Act. That bill, which passed through the Senate Finance Committee, would, among other things, extend certain tax credits for research and development, on which Pfizer places a premium. In fact, in announcing its offer for AstraZeneca, Pfizer CEO Ian Read said, “We believe patients all over the globe would benefit from our shared commitment to R&D, which is critical to the future success of the pharmaceutical industry, in the form of potential new therapies that help to fight some of the world’s most feared diseases, such as cancer.”
Washington Tax & Public Policy Group’s three lobbyists – Gregory Nickerson, Jan Fowler and Brian Diffell – representing Pfizer’s interests to Congress all previously worked in various congressional offices and committees. Nickerson served as a tax counsel on the powerful House Ways and Means Committee from 2001 to 2005.
The remaining $30,000 went to Federal Policy Group to lobby on “general tax issues.” One of the company’s lobbyists dispatched on behalf of Pfizer was Ken Kies, who worked on Capitol Hill for key tax-writing agencies in two separate stints: Kies was the chief of staff for three years on the Joint Taxation Committee and the chief Republican tax counsel for five years on the House Ways and Means Committee.
In announcing its proposed $98.6 billion offer to purchase its British rival, Pfizer said it “believes the strategic, business and financial rationale for a transaction is compelling.” The company said it would maintain its headquarters in Manhattan but would incorporate the newly formed firm in the U.K. – a move the Wall Street Journal reported would save Pfizer about $1 billion in taxes every year. Reuters is predicting that Pfizer’s move could set off a stampede of U.S. corporations seeking overseas shotgun weddings before Congress shuts down the lucrative tax loophole.
Sunlight’s Influence Explorer tool shows that since 1989, Pfizer has spent upwards of $137.7 million lobbying Congress on a variety of issues. In the same amount of time, the company and its employees have given at least $43.4 million to politicians and organizations.
For the 2014 cycle alone, Influence Explorer data show Pfizer and Pfizer-affiliated employees contributed $1,398,969 to politicians, PACs and campaign committees. William Steere Jr., who was Pfizer’s CEO and board chairman in the ’90s, cut a $32,400 check to the National Republican Senatorial Committee in March 2013. That same month, Read, Pfizer’s current CEO, gave $5,000 to TRUST PAC, the leadership PAC associated with Michigan Republican Rep. Fred Upton. Upton chairs the House Energy & Commerce Committee, whose Health Subcommittee oversees many issues including drug regulations and medical research.
In February 2013, in a show of down-the-middle bipartisanship, Pfizer – which makes a boatload of popular medicines, ranging from Advil to Lipitor to Viagra to Xanax – gave money to two Democratic groups and two GOP groups. It contributed $15,000 each to the National Republican Senatorial Committee, the Republican National Committee, the Democratic Congressional Campaign Committee and the Democratic Senatorial Campaign Committee.
The company gave another $15,000 to the National Republican Congressional Committee, and $10,000 to the a joint fundraising committee affiliated with House Speaker John Boehner, R-Ohio, the Boehner for Speaker Committee.
Pfizer also digs in on the political fundraiser circuit. Party Time records show the company and its PAC have hosted 22 parties since 2008, with fundraiser beneficiaries including members on key tax committees. Pfizer threw a party for Rep. Dave Camp, R-Mich., who chairs the House Ways and Means Committee, and for Rep. Shelley Moore Capito, R-W.Va., who sits on the House Financial Services Committee. In 2013, the pharmaceutical company also hosted three parties for Sen. John Cornyn, R-Texas, who serves on the Senate Finance Committee’s taxation and health care subcommittees.
And Pfizer cozied up to AstraZeneca in 2010, when their PACs co-hosted two fundraisers benefitting Rep. Patrick Meehan, R-Pa.
Reuters recently reported that the British Parliament is planning to investigate the proposed merger, and that Read, Pfizer’s CEO, is in the U.K. to talk with legislators and investors about the offer. If it goes through, the Guardian reported it would be the “biggest foreign takeover of a British firm” as well as present concerns about staffing cuts in the U.K.
AstraZeneca has until May 26 to decide its next move.