Apr 9, 2019

4 pharma companies saved $7 billion from GOP tax law

Photo: Kena Betancur/Getty Images

Four pharmaceutical companies — Johnson & Johnson, Pfizer, Merck and Abbott Laboratories — collectively kept $7 billion in tax savings in 2018 due to Republicans' 2017 corporate tax overhaul, according to a new Oxfam report.

The bottom line: Oxfam's results mirror our reporting, which shows pharmaceutical companies in particular have benefited from bringing back billions of dollars in overseas profits that have sat untaxed. However, this report says the tax savings have not led to other social goods, like more research investment in new drugs or lower drug prices.

By the numbers: The 4 companies highlighted by Oxfam mostly benefited from the repatriation of overseas cash.

  • $5.3 billion of the $7 billion of tax savings in 2018 came from bringing home untaxed offshore cash.

The big picture: "These are all policy choices," Niko Lusiani, a senior adviser at Oxfam, who wrote the report, said of the tax law and its effects. "And we haven't seen any big changes" in pharmaceutical industry behavior.

  • Oxfam focused on just 4 drug companies because they are large, representative and U.S.-based, Lusiani said.
  • Oxfam may take a deeper look at the pharmaceutical sector, but the group wanted to evaluate the short-term effect of the corporate tax overhaul and specifically whether drug companies were living up to their promises that the law would boost jobs, assets and productivity in the U.S.

Go deeper: Read Oxfam's report.

Go deeper

Updated 25 mins ago - Health

World coronavirus updates

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Axios Visuals

Over 500 schools in South Korea have either closed or postponed reopening, according to the Korea Times, which cites data from the Ministry of Education.

Why it matters: South Korea has been a model for how to handle the novel coronavirus, and the closures reportedly followed concerns from parents and teachers over child safety. The country's confirmed death toll has plateaued at 269 over the past few days, with few increases, per Johns Hopkins data.

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Coronavirus dashboard

Illustration: Sarah Grillo/Axios

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  2. U.S.: Total confirmed cases as of 4 p.m. ET: 1,735,971 — Total deaths: 102,286 — Total recoveries: 399,991 — Total tested: 15,646,041Map.
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  6. Business: Fed chair Powell says coronavirus is "great increaser" of income inequality.
  7. 🚀 Space: How to virtually watch SpaceX's first crewed launch Saturday.

Trump to end Hong Kong’s special trade status

President Trump. Photo: Win McNamee/Getty Images

President Trump announced on Friday that the U.S. would be fundamentally changing longstanding policies toward Hong Kong as a result of Chinese encroachment on the city's autonomy.

Why it matters: Trump said he would be effectively ending the special trade status that has allowed Hong Kong to flourish as a gateway to the Chinese market. That leaves an uncertain future for businesses that operate in Hong Kong, not to mention the city's 7 million residents, and could be met with reprisals from Beijing.