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Pfizer boss admits job losses can follow merger with AstraZeneca

THE chief executive of Pfizer has admitted job cuts were to be expected as "part of being efficient" but he could not specify where in the world the axe would fall in the event of the US drugs giant taking over AstraZeneca.

IAN READ: Forfar-born chief executive is leading Pfizer's bid to merge with AstraZeneca.
IAN READ: Forfar-born chief executive is leading Pfizer's bid to merge with AstraZeneca.

Forfar-born Ian Read, who has been with the company for more than 35 years, was speaking as he was grilled by MPs yesterday about the proposed £62.9 billion merger and the impact it would have on the future of research and development spending.

Mr Read told the Commons Business, Innovation and Skills Committee: "I do not expect the combined total will remain the same. I expect it will be lower, to what extent I cannot be specific."

His remarks are likely to add to concerns about the deal after politicians and unions expressed worries that it would lead to job cuts and damage the UK's position as a hub for research and development (R&D).

Mr Read wrote to David Cameron earlier this month outlining a series of promises should the transaction go through, including a commitment to AstraZeneca's planned R&D hub in Cambridge. The firm also said that 20 per cent of the post-merger R&D workforce of the newly-formed pharmaceutical giant would be in the UK.

Mr Read told MPs that he could not specify which country the cuts in R&D spending would fall in if the deal with the British firm went ahead. But he said in response to UK Government concerns "we made commitments that are unprecedented, that I don't think any company has ever made prior to an acquisition".

He added: "Those commitments are legally binding, not just for one year but for five . . . I am here today to make those commitments."

Sir Paul Nurse, president of the Royal Society, wrote to the committee to express his concerns that Pfizer's commitments were vague and that a five-year pledge on research and jobs is insufficient.

AstraZeneca said in written evidence to the committee that while it had benefited itself from mergers - it was formed from a UK-Swedish tie-up in 1999 - it believed "excessive consolidation" would undermine research as well as science skills.

Pfizer wants to create a new pharmaceuticals giant that will be domiciled for tax purposes in the UK but will cut back on the current combined £7 billion research budget of the two firms. The unions want Business Secretary Vince Cable to intervene to block any takeover.

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