Although New York-based Pfizer is the larger company, the deal is structured so that Allergan technically is the purchaser — a twist on the tax-avoidance tactic known as inversion.

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Pharmaceutical giants Pfizer and Allergan on Monday announced a $160 billion merger that would create the world’s largest drugmaker with high-profile products such as Botox, Lipitor and Viagra, while increasing pressure on U.S. officials to address corporate tax policy because the deal would shelter the new firm’s global earnings.

Although New York-based Pfizer is the larger company, the deal is structured so that Allergan technically is the purchaser — a twist on the tax-avoidance tactic known as inversion.

The move allows the new firm — which would take Pfizer’s name and be headed by its current chief executive, Ian Read — to be headquartered for tax purposes in Dublin, Ireland, home of Allergan, to take advantage of the nation’s lower corporate-tax rate.

Biggest inversion deals

Here are some of the biggest deals, excluding debt, with the year in which they were announced.

2015: Pfizer buys Allergan for $146.5 billion (pending).

2014: Medtronic buys Covidien for $49.66 billion (completed).

2013: Liberty Global buys Virgin Media for $17.03 billion (completed).

2012: Eaton buys Cooper Industries for $13.14 billion (completed).

2014: Burger King Worldwide buys Tim Hortons for $12.01 billion (completed).

Dealogic

The maneuver is a variation on the conventional inversion, in which a U.S. firm buys a smaller foreign competitor in a lower-tax nation and shifts the merged company’s headquarters there.

Pfizer and Allergan said their deal would lead to an effective tax rate for the new company of about 17 to 18 percent. Pfizer’s effective tax rate last year was 25.5 percent, a regulatory filing shows.

President Obama and members of Congress from both political parties have complained about companies using the maneuver to lower how much they pay in U.S. taxes. The Treasury Department has taken steps, including several announced last week, to try to hamper inversions.

Those changes weren’t enough to keep Pfizer and Allergan from merging in the largest inversion-type deal so far by a U.S. company.

“The proposed combination of Pfizer and Allergan will create a leading global pharmaceutical company with the strength to research, discover and deliver more medicines and therapies to more people around the world,” Read said.

“Through this combination, Pfizer will have greater financial flexibility that will facilitate our continued discovery and development of new innovative medicines for patients, direct return of capital to shareholders, and continued investment in the United States, while also enabling our pursuit of business-development opportunities on a more competitive footing within our industry,” he said.

Read said lowering Pfizer’s taxes wasn’t the only motivation.

But some Democrats criticized the deal, which in effect turns one of America’s largest corporations into a foreign company.

Sen. Bernie Sanders, the Vermont independent seeking the Democratic presidential nomination, called on the Obama administration to block the deal.

Jamie Court, president of advocacy group Consumer Watchdog, said the consolidation of two pharmaceutical giants could lead to higher drug prices because of decreased competition.

“Certain patients are going to not only see elevated prices, but potentially a loss of choice,” he said.

The deal values Allergan at $363.63 per share, about 30 percent more than its price when reports of a deal first surfaced last month.

Allergan shareholders will get 11.3 shares of the new company for each of their shares. Pfizer shareholders will get one share of the new company’s stock for each of their shares.

The deal must win approval of both European and U.S. regulators before it can be completed.