Pfizer Inc., the world’s biggest drugmaker, was asked by U.S. regulators how it recorded high profit overseas and losses at home when 40 percent of its sales were inside the U.S.
In a May 9 letter filed today, Securities and Exchange Commission staff asked New York-based Pfizer to explain why earnings before taxes outside the U.S. were $15 billion in 2011 while losses within the country were $2.2 billion. By piling up profit in low-tax jurisdictions overseas, Pfizer has been able to cut its tax rate reported to investors and boost results.
“We conduct business in more than 150 countries and face significant competition from companies located outside the United States, including many competitors located in lower tax jurisdictions,” Campion said in an e-mail. “At all times and wherever we operate, Pfizer complies with the appropriate tax law.”