WASHINGTON, Aug 14 (Reuters) - A senior U.S. senator said on Thursday he has written to the chief executive of Hospira Inc and urged the drug and medical device maker not to move its tax domicile abroad to save on U.S. taxes.
Dick Durbin, the No. 2 Democrat in the Senate, said in a statement that he told Hospira CEO Michael Ball in the letter that the company should not “turn its back on American taxpayers and consumers by taking advantage of a tax loophole called ‘inversion.'”
Durbin’s statement came amid growing concern in Washington with inversion transactions, which allow U.S. corporations to shift their tax home-base to a different country and cut their U.S. tax bills.
Of 52 inversions and similar redomiciling deals done since 1983, 22 have occurred just since 2008, with 10 more being finalized and many more said to be in the works.
Hospira is based in Lake Forest, Illinois, Durbin’s home state. The company could not immediately be reached for comment.
“Hospira’s success, including second-quarter profits that more than doubled, depends on the educated workforce, transportation infrastructure, and tax benefits here in the United States,” Durbin said he wrote to the company.
“Your company’s injectable drugs and infusion technologies are purchased through taxpayer-supported programs, such as the Veterans Health Administration and Medicare, which have contributed to Hospira’s corporate success,” he wrote.
Hospira’s shares closed on Thursday up less than 1 percent at $55.71 on the New York Stock Exchange. (Reporting by Kevin Drawbaugh; Editing by Richard Chang)