Pfizer

Pfizer has been the biggest pharma company throughout the first decade of the 21st century, and continues to set the pace and many trends in the sector.

In 2009, it addressed its biggest problem, the impending expiry of blockbuster Lipitor, by spending $62 billion in acquiring fellow US pharma company Wyeth.

Then in December 2010, the company's chief executive Jeffrey Kindler unexpectedly announced his departure, an unplanned exit believed to be down to disagreements within the boardroom.

Long-time Pfizer executive Ian Read is now at the helm, and must steer the company to safety as it hurtles towards the Lipitor patent precipice.  The company's top selling cholesterol treatment will see its US patent expire in November 2011, with its $11 billion revenues expected to be rapidly eroded.

Pfizer had continued its programme of cutbacks, adding to the plan to shed 19,000 employees in total.

Pfizer's unit in Bridgwater, New Jersey, was among the first to go after the merger, employing 300 people focuses on manufacturing and process development, and Wyeth's Great Valley building, which handled administrative functions such as information technology.

Two Wyeth facilities in Collegeville, Pennsylvania will also be closed, although the main pharmaceutical campus there will be kept as the focal point for Pfizer's speciality medicines business, including vaccines.

Wyeth's corporate headquarters in Madison, New Jersey, will stay open and take charge of diversified healthcare, including consumer and animal health businesses.

Pfizer has said it expects $4 billion in savings by 2011 from plant and programme rationalisation, on top of ongoing restructuring efforts expected to cut costs by $2 billion.

Pfizer reorganised its R&D into two units - and BioTherapeutics, led by Mikael Dolsten) and PharmaTherapeutics, headed by Martin McKay, but McKay jumped ship to lead AstraZeneca's R&D in May 2010. Pfizer responded by abandoning this twin-track approach, and put former Wyeth R&D chief Dolstein in charge of all research and development.

The merger created a total of 20 R&D sites, which Pfizer declared it would cut back to just five. Then in February 2011, it announced that it would close its European R&D headquarters in Sandwich, Kent in the UK, with the loss of 2,400 jobs.

The company says it expects to spend 30% less on R&D this year than last, dropping from its pipeline 15 drug projects, including four late-stage ones.

Pfizer’s sales decreased slightly in the first quarter of 2011 after rising revenues in specialty care and emerging markets failed to offset poor performance in the company’s largest business segment.

Primary care sales fell 7% to $5.4 billion, pulled down by declining Lipitor revenues. The blockbuster cholesterol treatment’s loss of exclusivity outside the US continued to erode its dominance and sales were down 13% in the first three months of this year to $2.4bn.

Overall revenue dropped from $16.58bn last year to $16.5bn this time, but the company was still able to produce profits of $2.22 billion in the first quarter, up from $2.02bn for the same period in 2010, following a rigorous cost-cutting programme.

Chief executive Ian Read said the results were “solid” and pointed to expected filings in the US and Europe by the end of 2011 for various products.

These include arthritis drug tofacitinib – although last month four deaths were reported in a late-stage study – and the blood-thinner  Eliquis, which has been developed with Bristol-Myers Squibb and is now being launched across Europe.

The company sold off its drug delivery unit Capsugel for $2.38 billion in April, in part to fund its ongoing share buyback programme, which Pfizer says will see the company repurchasing between $5bn and $7bn of its common stock this year.

There is still no direct word from senior management on speculation that Pfizer intends to focus on its pharma business, and will get rid of its animal, nutritional and consumer health activities at some point.

Read would only say that the company is “focused on continuing the evaluation of our business portfolio to determine the optimal mix of businesses”. “We expect to complete this evaluation during the second half of 2011,” he concluded.

View Pfizer's pipeline