Antitrust Lawyer Files Suit to Stop Pfizer Merger

Antitrust Lawyer Files Suit to Stop Pfizer Merger [The Day, New London, Conn.]

From Day, The (New London, CT) (November 20, 2009)

Nov. 20--A prominent San Francisco antitrust attorney said Thursday he has filed a request in federal court for a temporary restraining order against Pfizer Inc. to try to roll back its merger with Wyeth Pharmaceuticals and prevent the closure of six research-and-development sites, including one in New London.

"I think they have a real problem," said attorney Joseph M. Alioto, son of a former San Francisco mayor, in a phone interview. "People are somewhat numbed by the last 10 years when antitrust laws were not enforced at all. Everybody gets used to these huge mergers and think it must be OK. But that's not the law."

Alioto said he had tried to block Wyeth's buyout on behalf of a group of California pharmacies in August but was rebuffed when Pfizer claimed this merger would be different from previous ones. Instead, he alleges, all the predictions he made in his previous lawsuit came true, including Pfizer announcing the closure of R&D sites, the exiting of certain therapeutic areas and the raising of prices.

"We continue to believe the plaintiff's claims have no merit," Pfizer spokeswoman Joan Campion said in a statement.

Judge Maxine M. Chesney gave Pfizer a day to respond to Alioto, who said the Wyeth-Pfizer merger is a violation of the Clayton Antitrust Act.

"The announcement that drug companies are raising prices in the face of a declining consumer price index, which has fallen 1.3 percent in the last year, plus the fact that these drug company executives meet once a month, is more than enough for the Department of Justice to convene a grand jury investigation," Alioto said in a statement.

Alioto said California pharmacies got together to fight the Wyeth merger because of concerns over drug pricing and diminished competition. But he said the pharmacists are also concerned that cutbacks in R&D expenditures will diminish innovation and lead to fewer drugs being developed.

Nearly 5,000 Pfizer scientists work at the company's former worldwide R&D headquarters in New London and at its largest research laboratory in Groton. But Pfizer has announced a shutdown of the New London site within two years with a shift of personnel there to Groton.

Alioto said he is particularly appalled that the Federal Trade Commission approved the merger last month even before the public-comment period had expired. Alioto, whose case will be heard Dec. 4, said there are precedents to rolling back mergers that already have been announced. And if the merger can't be undone, he said, the judge could order Pfizer to sell Wyeth to another company or split it up.

Pfizer pointed out that Alioto previously tried to block the merger without success. "The FTC, which has antitrust expertise, reviewed the competition aspects of the merger, and concluded there are no competition concerns" after Pfizer agreed to sell off Wyeth's animal health division to Boehringer Ingleheim.

While Alioto's attempt to stop the merger appeared to have little chance for success, he vowed to press on. "I'm not interested in just simply crusading," said Alioto, who has been pursuing antitrust cases for 40 years. "This is not a lark or a publicity stunt."

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Copyright (c) 2009, The Day, New London, Conn.

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