Pfizer's $1.3B Esperion Loss Contained a $426M Tax Win

Last Updated Jan 4, 2010 6:00 AM EST

Pfizer (PFE)'s unfortunate deal with Esperion Therapeutics has a silver lining. Six years ago, Pfizer acquired the company for $1.3 billion, but its cholesterol drug program went on "hiatus" and in December the product was licensed to The Medicines Co. for milestone payments totalling just $160 million, according to The Day.

While that puts Esperion on a par with failed diabetes drug Exubera in terms of wasted Pfizer money, the deal eases Pfizer's tax situation. According to Pfizer's most recent 10-Q, the company recognized a $426 million "tax benefit" on Esperion. A footnote on page 49 of the disclosure regarding Pfizer's income tax says:

Also includes a tax benefit of approximately $426 million in the first nine months of 2008 related to the sale of one of our biopharmaceutical companies (Esperion Therapeutics Inc.).
Bingo!