Pfizer said buying Hospira would complement its established products business, citing sterile injectables and its biosimilars portfolio as key additions to its portfolio.
Pfizer CEO Ian Read said: "Hospira’s business aligns well with our new commercial structure and is an excellent strategic fit for our Global Established Pharmaceutical business, which will benefit from a significantly enhanced product portfolio in growing markets."
The news comes just weeks after rumours circulated that the US drugmaker had been in discussions with Israeli drugmaker Teva Pharmaceutical Industries about a potential buyout.
The move also follows Pfizer’s unsuccessful effort to buy fellow UK-headquartered drugmaker AstraZeneca last year.
The bid for UK-based AstraZeneca was partly designed to help Pfizer reduce its taxes.
Last week Reed told investors that proposed changes to US tax laws were not likely to stop drug companies employing such tactics.
He said: “So inversions are being tempered by the ability to pay the market price given the slow realization of the inversion value.” For as long as the practice is possible, “it’s an area that will remain fertile,” he said, given the US’s “uncompetitive” tax code.
For the moment, it is only “more problematic to plan inversions. We’ll just have to work around that,” said Read.
Hospira is based in Lake Forest, Illinois in the US.