James Moore: They call it tax inversion, we call it outrageous

Outlook No wonder people feel cynical about the pharmaceutical industry. As Ebola rages through West Africa, and with myriad other pressing medical problems to solve, the top priority of the industry’s leaders appears to be finding new ways to outwit the taxman.

Now the US taxman is biting back, albeit tentatively. Drugs group AbbVie has decided to reconsider its planned merger with London listed Shire, which had precious little to do with the latter’s treatments and everything to do with getting its hands on Shire’s tax domicile.

Unfortunately for AbbVie, the Obama administration is trying to call time on tax inversions – the popular Wall Street wheeze of finding a foreign company to merge with so you can re-incorporate in its home territory and avoid (high) US taxes.

Unfortunately for AbbVie, the benefits are now much harder to see.

As for the Irish headquartered, Jersey registered Shire, well, there’s always the prospect of a $1.64bn (£1bn) break fee to console it. You might hope it would use that to bolster its research capabilities. If so, you’re likely to be disappointed.