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DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: derekb.lowe@gmail.com Twitter: Dereklowe

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In the Pipeline

« The Real Hazards of the Lab | Main | A Long Tail Indeed »

January 26, 2009

Pfizer / Wyeth: Different This Time?

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Posted by Derek

The Pfizer/Wyeth deal is on, and I would really, really prefer to write about something else this morning. The main thing we can hope for is that the company has decided, just possibly, that its previous takeovers didn’t quite work out the way that they were supposed to on paper, and has resolved to run this one differently. The fact that Wyeth doesn’t have One Huge Drug (the way Warner-Lambert had Lipitor, or Pharmacia-Upjohn had Celebrex), gives me at least a little hope. But, as people were pointed out in the comments to Friday's post, there's no way that you can make this deal work without a lot of layoffs.

What’s frustrating about the way Pfizer’s been going is that I don’t think they’ve necessarily been trying to destroy things. It’s just that they’re so massive that it’s hard for them to pick anything up without crushing it. I could be wrong about that – perhaps there’s an official strategy document somewhere that reads:

“Buy company. Strip of immediately valuable pipeline assets and turn over to Marketing Hordes. Fumble with rest of drug discovery pipeline for a few years while trying to figure out where in the massive scheme of things its parts might fit. Realize that the stuff you bought is going off patent – how time flies! Realize that you have too many sites and too many people – close 'em down, lay 'em off. Realize that, for some reason, you have nothing new ready to sell. Go back to step one. Repeat for as long as there's another drug company.”

If this hasn’t been the plan, it might as well have been. Do it differently this time, guys, if you can. The industry can’t take this stuff forever. If people had internal organs that behaved the way Pfizer has the last ten years, we’d be developing drugs to treat them.

Comments (64) + TrackBacks (0) | Category: Business and Markets


COMMENTS

1. anon on January 26, 2009 8:54 AM writes...

I remember saying something about how management will keep on consolidating and gutting companies (after they have micromanaged productivity out of research) till there is nothing left to consolidate.

To understand their modus operandi, think of viruses and healthy cells. Obligate out-of-control parasites will destroy the remaining host till there are no more hosts.

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2. ty on January 26, 2009 9:04 AM writes...

"If people had internal organs that behaved the way Pfizer has the last ten years.." Ha, you meant to say cancer. And so say we all.

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3. Anonymous on January 26, 2009 9:23 AM writes...

Using the cynically stated model, Pfizer has become the leading pharmaceutical company in terms of sales. Even without mega-drug Lipitor, they would still be in the top 5. So, we can lament many 'could have beens' but the model has indeed worked. Consider that what Pfizer has learned is that instead of 'fumbling with the rest of the drug discovery pipeline for a few years', cutting it early is a more practical and efficient solution. If there is so much value in these abandoned programs, then there should be a market for selling off the assets - let the current champions of such programs go out and find the financing. Should they be successful and get to a promising phase III, PFE and others will be there to buy them.

The concerns that 'R&D doesn't scale' and criticism of cutting R&D are at odds in my opinion. If it doesn't scale, then it should be reduced. An active venture arm of the company, which exists, can encourage independant development. There will always be 'another drug company' for Pfizer to repeat the process - and the best way to insure that is by setting R&D free. The entrepreneurial members of the community will recycle.

Zz

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4. vkg on January 26, 2009 9:26 AM writes...

Robin: Gosh Batman, the nobility of the almost-human porpoise.
Batman: True, it was noble of that animal to hurl himself into the path of that final torpedo. He gave his life for ours.

vkg

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5. A-nony-muse on January 26, 2009 9:26 AM writes...

@ Anonymous

Here here! Won't be popular in these parts, but you speak the truth...

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6. petros on January 26, 2009 9:36 AM writes...

In 2007 two-thirds of Wyeths' pharma revenues of $18.8 billion cam efrom just 6 products.

Effexor $3.8 billion 20.7% of revenues generics in 2008
Protonix %1.9 billion 10.3%, geneics launched 2007
Premarin range $1.0 billion introduced in teh 1940s


Only Zosyn, of the synthetic therapeutics $1.1 billion, plus Enbrel $2.3 billion and the vaccine Prevnar $2.4 billion are currently patent protected.

This hardly addresses Pfizer's problems of patent expirations

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7. HelicalZz on January 26, 2009 9:39 AM writes...

Oops, didn't mean to post anonymous, oh well.

I'm in R&D so I feel the pain, and really really wish there wasn't so much talent out there competing for positions right now. But this will always be a business first, as it likely needs to be.

Zz

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8. Mr. AtoZ on January 26, 2009 9:41 AM writes...

"While credit has been notoriously tight of late, five banks have agreed to lend Pfizer $22.5 billion to pay for the deal"

Nice to know my tax money that went to the bail out will now be use to fire me. Welcome to the new world order.

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9. Jose on January 26, 2009 9:45 AM writes...

So much for that "career" thing.... the Borg is dead! Long live the Borg!

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10. 19000 New Zombies on January 26, 2009 9:46 AM writes...

From Bloomberg.com

"Pfizer also will halve its quarterly dividend to 16 cents a share, fire 15 percent of the combined company’s workforce, or 19,000 people, and close five factories."

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11. Kay on January 26, 2009 11:12 AM writes...

Zz: The problem is that a rewarding and efficient finance model has been missing for nearly a decade now. Hence, these are dead assets.

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12. Nick K on January 26, 2009 11:19 AM writes...

Recall that the market cap of Pfizer is no higher than it was a decade ago. It would be most interesting to calculate the overall shareholder value destroyed by Pfizer's takeover of Pharmacia and Upjohn, WL, and now Wyeth. Many tens of billions of dollars, probably.

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13. startup on January 26, 2009 11:23 AM writes...

Derek, let's be realistic, there's no hope. The announcement says $4B in annual savings - that means closed sites and layoffs, tens of thousands of layoffs.

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14. Cellbio on January 26, 2009 11:41 AM writes...

Zz, I think you simplify the argument a bit, or at least it seems so to me, maybe I am missing something.

When a company like Pfe eats other companies, they eat sales, so revenue rises, but what about research investment for future opportunities? It seems that R&D is the major "cost center" that delivers up the savings through reduction.

Go find funding and get to a PhIII? Even before the crash, most VCs wanted to fund a project to either sell a fanciful idea to a bigger fool downstream, or sell to a large company with a pipeline gap and take advantage of the desperation. It is almost entirely impossible to expect funding to build a full company capable of bringing a drug through to Ph3.

I think you are right that since R doesn't scale, the cuts by big co's make sense from a business perspective, in the short term anyway. But how does this model, in today's environment, support innovation in the future?

Some really smart MBA's argued recently that we are in a post-science era, where science is a commodity that can be outsourced, while innovation will still be the "strength" of the US business community. When I see the workings of big drug companies, the self-serving perspective of the business types, I am not shocked to hear this, but hope the insanity has reached the fever pitch before the fall. I think something has to change, and maybe your vision of a revitalized research community lead by freed entrepreneurial scientists will materialize, maybe ushered in by the forward thinking American business mind. I guess one has to be an optimist to be in this biz.

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15. Palo on January 26, 2009 12:02 PM writes...

Depressing stuff, Derek. Upper management, in government, corporations or anywhere is solely a self-perpetuating activity. Kindler's mission is not to bring innovative drugs to the market, it's to bring innovative "numbers" to the Director's Meeting.

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16. Dan on January 26, 2009 12:36 PM writes...

Cellbio,
I would be cautious about listening to "really smart MBAs". Remember "really smart MBAs" created credit default swaps and believed that they carried no risk. Further, many MBAs are looking at Pharma from a financial engineering perspective, without actually understanding the industry or how it functions. This leads to "insight" such as science is a commodity.

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17. gya on January 26, 2009 12:50 PM writes...

who will they purchase next?

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18. Cellbio on January 26, 2009 12:57 PM writes...

Dan, exactly! I should have made my sarcasm more evident. I made the inaccurate assessment that placing "really smart" next to "MBA" would be the tip off.

Got to love the CDS scheme. I'll sell you my risk, at a profit for me, you will buy it, and immediately value it above the purchase price, so both of us post a profit! The inward looking, group think common to MBAs is often held above logic and common sense. This was epitomized for me by Fuld, the ex-Lehman chief, who said that gross leverage was not the best parameter of risk, but net leverage. This wisdom was offered after Lehman collapsed. So blinded by ego that absolute failure, unprecedented in history, is not enough to open his eyes!

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19. gcicila on January 26, 2009 1:08 PM writes...

Speaking as both a biomedical researcher and shareholder in both companies (a very small one), one remember that this is a publiclly traded company and that it is up to the shareholders to determine whether or not this deal makes economic sense to them. It impact on overall research is pretty irrelevant to them.

That having been said, clearly, they have been wrong in the past.

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20. Mr AtoZ on January 26, 2009 1:18 PM writes...

gciclia, The same can now be said for physicists who SEEM to think a black hole will now form by the collider.

That reminds me of the risk of default on those subprime derivatives that S&P and Moody's rated as AAA. I don't want SEEM in any sentence that discusses the possibility of creating a catastrophically expanding black hole on earth.


http://arxivblog.com/?p=1136

Derek, maybe you can feature this in your column?

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21. Gateway on January 26, 2009 1:47 PM writes...

If you create a real professional union of chemists, you can fight back. Otherwise you guys are all toast.
Of course most of you seem to be stuck in the 80's.

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22. RTW on January 26, 2009 1:57 PM writes...

Gateway - Ya, thats worked really well for the automotive industry workers lately.

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23. HelicalZz on January 26, 2009 2:12 PM writes...

Venture capital investment into the biotech industry, dominated by early stage pharmas, is hardly dead. It is down from 2007, which was its strongest ever, but still well ahead of 2005 levels and more than twice what was seen in the 90's (see the MoneyTree Report). I do not fear for the future of the industry as a whole.

This has always been an industry of transitions. In drug development, the skills and people needed to develop drugs are different from those needed for clinical evaluation and different still from sales and marketing. Lets be honest, success for 'drug discovery' is measured long long before commercial payoff. The industry paradigm isn't just 'reduce development headcount when headed to market' but to reduce it far earlier in the clinical process. Bites to be part of the early efforts and not see the payoff, but it is hardly a new phenomenon.

Zz

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24. chemist on January 26, 2009 2:13 PM writes...

Pfizer turn you down for a job in the past?

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25. tyrosine on January 26, 2009 2:45 PM writes...

For those who think that this is a bad move for Pfizer and big pharma (ME!), please remember this: The free market economy is driven by need. If people need new drugs, then people need drug discovery. If Big pharma wants to do less, then that only means more for small pharma and biotech (or China).

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26. imatter on January 26, 2009 3:00 PM writes...

Is anyone blaming Wyeth? It takes two to sign the contract.

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27. TheEdge on January 26, 2009 3:01 PM writes...

Pfizer is now saying it will cut 26,000 jobs: one 10% cut in current Pfizer (8,000) then a further 18,000 once the Wyeth merger is complete

http://money.cnn.com/2009/01/26/news/companies/pfizer_wyeth/index.htm?postversion=2009012611

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28. Sally Church on January 26, 2009 3:16 PM writes...

The Wy-Pfi deal makes a lot of sense for Wyeth senior management given the likely golden parachutes, but whether it makes sense in general for the shareholders and the pharma industry at large is another thing altogether.

The infectious greed is rather depressing and not something I wanted to blog about either but the topic is compelling. There is no guarentee that the shareholders or mergers commission will approve it.

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29. Jack Vinson on January 26, 2009 3:57 PM writes...

Ah, I remember this story. I was part of Searle (Monsanto) when they went through the dance with then-American Home Products (now Wyeth). 1997. That was the height of the stock price EVER for Monsanto as a pharma-food-agri business. The deal didn't go through. Searle merged then was bought eventually by ... Pfizer. It would be strangely entertaining if Pfizer managed to pick up Wyeth. Then of course, I am not part of that business any more. Not so entertaining for those involved.

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30. Pfizerite on January 26, 2009 3:58 PM writes...

The only difference this time is that Pfizer will probably fire more people quicker than they did after the Pharmacea merger. As Derek and others have pointed out Pfizer has bought and joint-ventured with a lot of biotechs and small molecule start-ups with very little to show for it. If senior management was smart (highly doubtful) they would be looking at the past deals and see what lessons can be learned, otherwise Pfizer will find itself in the same hole in another 5-6 years.

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31. Mr AtoZ on January 26, 2009 4:06 PM writes...

Did you see the CEOs turn red when a reporter asked them how they felt using TARP money to fire people? The jerk bosses spouted off corporate
propaganda talking points as if it was 2005, not 2009

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32. anon on January 26, 2009 4:30 PM writes...

"Did you see the CEOs turn red when a reporter asked them how they felt using TARP money to fire people?"

If the Gov't has any decency, they will block the deal and CAREFULLY audit both companies, leaking all the embarassing stuff. These people are worse than dung beetles, which, by the way, have also gone carnivorous.

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33. Anonymous on January 26, 2009 4:43 PM writes...

Before Warner-Lambert was bought by Pfizer (~$92b) they had started a merger with American Home Products (now Wyeth). The Lipitor co-marketing agreement with Pfizer protected WL from a buyout, but when they started the deal with AHP it ended the protection.
WL had a great consumer product division, which Pfizer promptly liquidated to J&J and a few other cos. Now a consumer health division is cited as a plus in a merger with Wyeth.
I totally ignore stuff like "they have a great X division that's a good fit".
The past two acquisitions boiled down to Lipitor and COX2 inhibitors. That's what's left of WL and Pharmacia. Why should Wyeth be any different?

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34. milkshake on January 26, 2009 5:10 PM writes...

Pfizer was actually prevented by unions and labor laws from closing down its Nerviano site in Italy. Nerviano was taken over by the government and exists as a fairly successful kinase research institute to this day.

Moonshine-makers of the Word, unite! You have nothing to lose but your stils

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35. Teuta on January 26, 2009 5:18 PM writes...

...and so it continues. A Sunday Times article described the recent rounds of redundancies as Big Pharma's corporate anorexia...to which we can now add bulimia. Truly stupidly tragic.

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36. Mark M on January 26, 2009 5:21 PM writes...

"WL had a great consumer product division, which Pfizer promptly liquidated to J&J and a few other cos. Now a consumer health division is cited as a plus in a merger with Wyeth."

My thoughts exactly--what a bunch of bunk. Seriously, do they think we dont remember past last quarter?

Anyone else remember buying Chiclets, Listerine and Tetra fish food from the company store in A^2?

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37. Ruth on January 26, 2009 6:44 PM writes...

"Anyone else remember buying Chiclets, Listerine and Tetra fish food from the company store in A^2?"

Remember the big chunks of Morley's chocolate?

The local paper used to complain about Big Pharma, until the gates closed and they realized how much tax money the evil corporation paid.

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38. The(Apparently Other)Edge on January 26, 2009 6:50 PM writes...

I don't think I've ever posted here before, but I used to post on Tot Syn as TheEdge. I'm gainfully employed in Pharma now, and I thought I should point out that I'm a different person than the person above (I know I have friends who read both blogs). Whomever he/she is can have the handle, I'm just trying to avoid possible blowback from future uses, or accusations that I post from work about work related things.

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39. soon to be unemployed on January 26, 2009 7:16 PM writes...

I became a chemist to be able to HELP people. I surrounded myself with dangerous chemicals and worked long hours to hopefully help people in need with diseases that do not discriminate. I never thought of what I did as "just a job" and I hoped that the people that chose to do what I do for the same reasons are not feeling nearly as disheartened as I could be. I'll most likely be trying to find a job because of this mess and I hope to have the same optimism I had when I started in this industry. Am I alone out there or has our world turned to Ayn Rand for guidance?

People complain about the time it takes a drug to be developed. With moral surrounding me as low as it is now, NOTHING is being worked on in the labs. HOW long will it take for these projects to start humming again? HOW long will it take for management to see that without ensuring those that will still have jobs will continue to be less if not completely unproductive? IF Kindler/Pousset REALLY are looking out for the PATIENTS who take PFE/WYE products- TELL their employees whether or not their jobs are secure so we can continue to work like we have a future and our work will not be in vain.

After hearing about the deal from the news and friends before management, give us a little respect and do not allow us to continue to walk around like zombies. We are good people trying to do good things for the world. Treat us like it!

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40. confused on January 26, 2009 7:23 PM writes...

Do not continue to tell the world that PFE/WYE are about helping patients and people.

These cuts are hurting people- employees and people waiting on the employees to find treatments for them.

Do not tell the employees that this deal is to save and is just business.

Are PFE/WYE out there to help people or is it just business? The only people helped here are those with golden parachutes or the bankers who will have a job working on these deals!

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41. milkshake on January 26, 2009 7:24 PM writes...

The Edge: I appreciate that you are a painfully employed man and I would like you to understand that even as there are no snitches among readers in certain cases it is our duty to track the IP addresses and report the names to the corresponding employers. Please place your personal belongings in a box with your home address on the label - the HR exit interview invitation may come shortly.

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42. The(Apparently Other)Edge on January 26, 2009 7:44 PM writes...

Milkshake, I always knew your every-chemist attitude was nothing but a facade over your Orwellian soul.

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43. MTK on January 26, 2009 8:39 PM writes...

Intel, 6,000 jobs gone.
Microsoft, 5,000
Caterpillar, 20,000
Sprint Nextel, 8,000
Home Depot, 7,000

That's just in the last week.

There's no such thing as Pharma Exceptionalism nor should there be. Things are tough all over.

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44. Pete on January 26, 2009 10:22 PM writes...

26000 jobs cut looks like they are planning for 2012 in 2009

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45. Dr. Manhattan on January 26, 2009 10:51 PM writes...

One would hope that statements made by Pfizer senior management about the desirability of the merger would be compared to other statements made by the same managers just last year on why a big merger would not be in Pfizer's best interest.

This indicates either that there is no long range strategic plan in place or that they think their shareholders are stupid. BTW, Pfizer stock closed down by more than 10% today. The acquirer's price always declines, but this is quite marked. Maybe it is also a reaction to cutting the dividend in half as well. At what point will the big institutional investors decide they have had enough and pull the plug, dumping the stock?

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46. LFree on January 26, 2009 11:28 PM writes...

Aside from your shame-neutral self-promotionism, have you been personally research productive in a meaningful way at the company that laid you off?

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47. LNT on January 26, 2009 11:38 PM writes...

Does anyone else find it odd that Wyeth stock is trading at $43 even though the Pfizer purchase price is $50.13? That must mean that a significant number of investors don't think the deal will happen.

Does anyone know about Pfizer severance packages? (As a WYE employee, I'm rather curious...)

Permalink to Comment

48. Chemjobber on January 27, 2009 12:22 AM writes...

@LNT: I've heard that it's either 2 months or 6 months (I forget which) + 2 weeks for each year of employment.

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49. Hap on January 27, 2009 12:46 AM writes...

Zz:

1) If the income (and market cap) are the same and are not inflation-adjusted, it's a 30-40% drop in real money. Not so good for creating value.

2) Analogy: if you're a farmer, say you can make more money strip mining your land for coal. If you use the money to buy more land for coal, you can generate even more money - of course, when you're done, there isn't going to be a whole lot of farming revenue. Pfizer continues to buy productive businesses and sell off the valuable parts, but what's left isn't generating more revenue or value (market cap), and it's destroying the capacities of others to develop drugs.

At least when you eat the seed corn, someone's getting something from it - other than the management teams and the investment bankers, no one's going to get rich from this deal, and yet unless Pfizer changes its tune, there will be less drug development capacity available (and fewer drugs, if the productivity enhancement of past mergers repeats itself). What do they intend to sell if they don't have productive research? If they're not getting increased revenue (the usual reason to merge), enhanced research (since there won't be many people left), or increased cap (the debt needed to make the deal won't help), what is the point?

3) Cutting unproductive R+D would be helpful. Buying (sort of) productive R+D and axing it for less productive R+D seems...counterproductive?

As a secondary note, if you get rid of the jobs to attract people to chemistry, and you get rid of the ability to develop drugs that allow to explain why what we do is useful and important, where exactly do more chemists come from? You can run ads looking for soldiers, but if people see blood stains and spent shell casings on the streets each morning, you aren't going to find so many takers. It isn't exactly Pfizer's job to care about this, but it s an easily anticipatable side effect that will do us no good in the future.

4) How many products have pharma companies outlicensed? I know there are some, but none that I can remember. The low number may be a product of the companies' unwillingness to farm out its IP rather than its lack of value. In the current financing market, lots of companies with good ideas may go under, and the possibility of funding an idea without a company yet seems even lower.

Without new products, pharma is more likely to sell what is left of its rep in DTC ads to maximize revenue from those it does have. This deal doesn't appear (unless someone at Pfizer knows how to choose productive people and areas of drug research, a capacity they've not shown yet) to make the number of drugs greater, and so it is likely to be destructive to the pharma industry as a whole, let alone the 26K or so who are going to lose their jobs in a bad economy with little startup funds available to use their experience and few other jobs available.

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50. ppp on January 27, 2009 2:17 AM writes...

33. Milkshake
Actually Nerviano was taken over by a Vatican institution not by the Italian government

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51. Don B. on January 27, 2009 7:09 AM writes...

There is NO reason to believe that pfizer management has suddenly become competent.The Wyeth folks have been sold down the river (IMO).

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52. befuddled on January 27, 2009 8:29 AM writes...

Hap,

You've made some very good points. In particular, it's very odd that there's so little outlicensing from big pharma. All those projects cut, yet so little effort expended in recouping the investment that created them by shopping them to other organizations.

It may be that big pharma research is so bad that there's no value in those projects. I suspect, however, that the incentives of those in a position to sell those projects are simply too misaligned for them to try to generate that kind of shareholder value.

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53. petros on January 27, 2009 8:33 AM writes...

What happened to my comments that were deemed to need approval?

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54. Hap on January 27, 2009 11:14 AM writes...

5) it is likely that the impending layoffs and mergers will lower the productivity of both Wyeth and Pfizer for a while, as everyone tries to sort out who stays and who goes. The timing might have been better - the clock keeps ticking on Lipitor (though I guess it doesn't matter so much now - it's not like a year is enough to find a follow-on or replacement anyway). Making a somewhat productive and a less-productive company into two unproductive companies (in the short term) might be negative financially.

It was less than two weeks ago (1/16 post) that one of Pfizer's heads was touting their lack of loss in productivity, while in the same post Pfizer's remainders were being told that there were no more layoffs planned (while the deal for Wyeth and presumably the layoffs needed to make it financially viable(?) were being planned). I wonder how often you can hear your bosses lie to you before you stop caring about what you do for them - maybe it's simply a larger number than the likely number of times you will hear them lie to you before you are laid off, and so there isn't a reason to worry, right? (Yes, there are other reeasons to care for what you do, but being rendered expendable and irrelevant (when your bosses don't even worry about lying to you), it can't be all that good for morale.) Since the lying seems to extend to stockholders as well, you might wonder when the level of dishonesty from the management of the companies they own might be too much for them to leave unnoted.

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55. Hap on January 27, 2009 11:15 AM writes...

Sorry for the multipost. I hate Internet Exoploder.

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56. CMC Guy on January 27, 2009 12:57 PM writes...

#52 befuddled there is much potential for outlicensing of Pharma projects that is untapped IMO, particularly after a Merger when project cast off because champions did not survive. As usual it comes down to Money as who can afford the cost/risk. Although in a few cases spin outs been able to get VCs interested enough to support it is hard to overcome the "if the Pharma decided to abandon it it must not be worthwhile" syndrome and the fact that Pharma normally still want to get paid a premium for the work.

A problem with all tech transfers is the amount and quality of info and Big Pharmas are often not set up well to consolidate and convey the data on early projects externally since everything is designed to feed massive internal systems (that can only make sense from the inside). I suspect, without proof, that if some wise soul could cull through Pharma R&D files there could be many viable drugs that languished due to "internal perspectives" that caused a halt as guess many were killed be "market too small" to hit blockbuster status.

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57. AliG on January 27, 2009 1:01 PM writes...

Regarding big pharma outlicensing products: The business development departments (which are the only ones allowed to out-license) do not have any incentive to out-license, so they refuse to do it. They do not believe it is worth their time to do the paperwork because the payoff (and any possible reward personably) is so far in the future. I have first-hand experience with trying to get a large pharmaceutical company to outlicense a project that was killed for "market considerations" (they thought the market was too small). The person with the power to outlicense the patent refused to allow it to be outlicensed because it wasn't worth the time of anyone in his department. I believe the reasoning is more sinister. If they outlicense something and it proves sucessful, it makes the decision made not to pursue the project look bad. If the asset dies on the shelf, there is no risk to it ever making the person look like the made the wrong decision. They don't care if patients die because they refused to out-license projects, as long as they don't look bad professionally, and who is going to find out anyway?

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58. Anonymous on January 27, 2009 8:06 PM writes...

Are Wyeth folks jumping ship yet, or is there any remote hope for a, I don't want to say bright, but maybe a not-too-dark future in Pfizer? And is there anywhere in the industry to go to?

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59. milkshake on January 27, 2009 8:48 PM writes...

AliG: this sounds very much like the problem our institute had with one large European company: They provided some funding over the years and for that they had the right to take in any research project close to the commercial stage, such as drug candidate. They would pay royalties when the development is completed. The result was that that they took everything on a precautionary, the compound collections and even the intermediates, then they would put it on shelf. Even as they were under obligation to develop the compounds and they obviously did not, it was extremely hard to get these "in-licensed" projects back from them.

As the contract was expiring, we were instructed not to start any new medchem project for the last few months, so that it couldn't get claimed by these corporate bureaucrats. The ironic thing is that we would like nothing better than a big company developing our compounds...

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60. drug_hunter on January 27, 2009 10:27 PM writes...

I tend to take a long view. There may be short-term financial gain for Pfizer in this deal ... but when I think about the importance of VALUES in building a successful, sustainable enterprise, I have to believe that Pfizer has, through the choices it has made over the past decade, pretty much doomed itself. Success in the future for any large company will come from having committed employees who function well within teams, who share information, and who are committed to a shared and uplifting values and vision. I would say that Merck during their heyday (1980s) would nearly qualify. A good current example these days (admittedly from outside Pharma) is IMHO Google.

Making drugs is hard enough; overlaying a totally disruptive and negative culture eliminates any chance of long-term success.

I wish my company could hire all the PFE and WYE people who are going to need jobs ... but no one is large enough to accomplish that. Best of luck to everyone soon to be affected by this.

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