Name: Mylan NV CEO defends corporate inversion
Uploaded: 2015-10-14
Duration: 5 min 45 s
Description: Heather Bresch explains why she took the company overseas.

[ MUSIC ] The company, there's been a lot going on, frankly, [ LAUGH ] since the last time we all spoke. Dramatic couple of years. You moved the company to Amsterdam. You briefly or perhaps still became the political poster child for inversion. Then you survived a hostile bid by Teva for your company and in part because of some laws that were specific to the Netherlands that allows you to name board members that then voted against the deal. Why did you do that? I'm tired, listening to everything that you just said we did over the last 12 months. I'm just getting started, here. [ LAUGH ] You know, it's interesting. I'll go back several years ago, and had a lot of conversations up on Capitol Hill, saying there is an unlevel playing field, in our country. The tax code, the way that we really penalize US based companies. And at least our sector, the health care sector which has had hyper competitiveness and activity in the M and A space, we were the last kind of standing US based company. And so I'm competing against Companies that are 5 %- So just to be clear, you're talking about in the generic space. Speciality pharmaceutical. We literally were the last ones still in the United States. So I'm competing against companies that have 5 % tax rates. Larger balance sheets to be able to compete for assets. It's a huge disadvantage. And, you know, unfortunately, Congress, there was no signs of Congress doing anything soon. So we had continued to say we weren't gonna do just be able to do an inversion. However if the opportunity presented itself, we would. And so when we acquired Abbott's generics business, their established products throughout Europe, it gave us the opportunity To invert, and we did. And yes, it became part of the perfect storm, but- And your dad who is a senator from West Virginia did in fact oppose this before he didn't. He didn't see the light in the beginning. [ LAUGH ] Unfortunately I think, like many, you can have a sound bite. I always say, don't let the facts get in the way of a good story. But the reality is, is that we need to remain competitive. And when I said, you know, Dad, we have 5, 000 employees in Morgantown, West Virginia. We're one of the largest employers in West Virginia. I said, I can guarantee you, if we don't protect ourselves, no one's gonna protect those jobs, and the other jobs that we want to grow here in the United States. So, perversely, it seems counterintuitive that we needed to invert. To grow here in the United States, which is exactly what we're continuing to try to do, even with our most recent acquisition target of Perrigo. Okay, so let's, in one second move on to that. But beforehand, one of the byproducts of this inversion was that you, there was a little known law in the Netherlands called Stickding. Think I got that right. Which helped- Became the favorite word on CNBC in the last three months. This concept, or this rule basically allowed you to oppose the take over, even though a lot of Wall Street wanted you to go forward with the deal. And now there are a couple shareholder lawsuits around that Did they just not do their homework, and not understand that this was part of the situation? I will say this, for all of my years in corporate America I continued to be shocked at I think how unprepared, many that stay very superficial and I don't think really understand Until there's a fire, until there's a crisis that people then have to dig deep. What I would say and what got a lot of airtime is we were a Pennsylvania corporation since the early 70s. And Pennsylvania, as some may know in here, is a stakeholder state versus a shareholder state. And, all that means is that shareholders are an extremely important stakeholder, but we can take other things into consideration. What's in the best of the company, the employees, so, it's one of many. And, unlike Delaware, that's where many companies have ended up domiciling, is very shareholder- driven. Which means price trumps everything else. When we were inverting, we did a lot of homework and looked at a lot of different countries. Because we had the opportunity to really domicile where we wanted to. And the Netherlands was a very natural. Because it had the same exact feel and laws and philosophical as { Pennsylvania did. And so from our perspective we said we had always been a stake holder company. with that being said, over the last eight years we returned 30 % CAGR to our shareholders. Total shareholder return. I've said a well run company does great by its shareholders, and we've continued to do that. I think there's a lot of noise and a lot of the rhetoric was well if you don't, if shareholders don't come first and the dollar amount doesn't come first then, you know, Wall Street has frowned upon that Right. and that short term, driving for the quarter is, you know, I think is going to continue to be unhealthy for our country. I hope that people continue to step back and say You know you can't build a great company quarter by quarter, and I was looking at some interesting statistics that in the 70s people held stock for an average of eight years. Today, it's six months. An average number. And I think that speaks volumes to what's incentivizing corporate behaviour

Heather Bresch explains why she took the company overseas.