Pfizer Inc. has approached Actavis with a possibility to acquire the company.
The companies aren’t in formal talks, said unnamed sources, with no offer on the table yet.
The news comes on a day rife with Wall Street downward pressure on biotech stocks, after U.S. Treasury Secretary Jacob Lew outlined new rules late Monday to dissuade domestic companies from so-called inversion, or using mergers and acquisitions as a way to move their headquarters to friendlier tax climates abroad.
Pfizer was rebuffed in a similar effort last May in $114 billion bid for AstraZeneca, which would have allowed it to move its tax domicile to the United Kingdom.
Parsippany, New Jersey-based Actavis would be an ideal inversion target for Pfizer because it snapped up its own Irish tax address last year when it acquired pharmaceutical Warner Chilcott Plc.
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