AbbVie and Shire terminate planned merger agreement

AbbVie has confirmed that it will no longer be acquiring fellow pharmaceutical company Shire, despite a 32 billion pound deal having been agreed this summer.

According to AbbVie, the transaction has been cancelled following the US Department of Treasury's decision to re-interpret longstanding tax principles in a way that undermined the financial benefits of the proposed deal.

Representatives of both firms held discussions to find ways of preserving the merger, but it was ultimately decided that it was no longer in the best interests of stockholders.

As such, both companies will continue to operate independently and will resume their previous growth strategies.

AbbVie chairman and chief executive officer Richard Gonzalez expressed disappointment over the regulatory issues that scuppered the deal, while voicing his continued confidence in AbbVie's "strong, sustainable strategy" and "robust pipeline".

Susan Kilsby, chairman of Shire, added: "We continue to enjoy excellent prospects as we execute our plan to double Shire's product sales to $10 billion [6.18 billion pounds] by 2020."