Big Pharma is catching fire for "aggressive tax planning." Apparently, some big drugmakers are taking advantage of legal loopholes in the tax code, by booking losses in high-tax jurisdictions--such as the U.S.--and recording profits in lower-tax countries--such as the Netherlands.

One example advanced by Bloomberg: Pfizer (NYSE: PFE) reported domestic pretax losses from 2007 to 2009 of $5.2 billion, but over just 2007 and 2008 posted pretax profits of $20.4 billion via a Dutch subsidiary. In the Netherlands, Pfizer's corporate taxes ran to just 5 percent, compared with a top rate of 35 percent in the U.S.

Shuffling the money in this way--which is perfectly legal--allowed Pfizer to boost its net income by $1 billion last year, a tax consultant tells the news service. Meanwhile, Eli Lilly's (NYSE: LLY) tax planning hiked its 2009 profits by 21 percent, to $4.3 billion from the $3.6 billion it might have posted otherwise, tax adviser Robert Willens concludes. In each of the past seven years, Bloomberg reports, Lilly posted more than half its sales in the U.S. but more than half its profits overseas. And Forest Laboratories (NYSE: FRX) moves profits from the antidepressant Lexapro through several overseas subsidiaries, the news service notes.

This isn't the first time that this practice of transfer pricing--in which companies move patents and manufacturing to foreign subsidiaries that sell product to other units for marketing--has come up for scrutiny. President Obama made something of a campaign issue out of it, and his proposed budgetcontained a moderated move against it. Meanwhile, GlaxoSmithKline (NYSE: GSK) in 2006 settled a transfer-pricing tax case, while AstraZeneca (NYSE: AZN) inked a similar settlement with the U.K. earlier this year.