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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

« Bad News: Pfizer Closes Site in Sandwich | Main | Pfizer's CEO Speaks »

February 1, 2011

Pfizer Part Two: Cuts at Groton

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Posted by Derek

Not only is Pfizer wielding the ax in England, but they're cutting 1,100 jobs back at HQ in Groton, while moving some therapeutic areas around. My neighborhood (Cambridge) is going to get more Pfizer-y as a result, but it's for sure that several others are getting less so.

The company's getting out of allergy, urology, respiratory diseases and other areas completely. Who out there can imagine that this is the end of the process?

Comments (101) + TrackBacks (0) | Category: Business and Markets


COMMENTS

1. GreedyCynicalSelfInterested on February 1, 2011 2:27 PM writes...

Reading this makes me glad that I left science more than 10 years ago.

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2. SP on February 1, 2011 2:50 PM writes...

But your neighborhood is soon to be Southie, right? Wicked pissah.

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3. MikeyMedChem on February 1, 2011 2:56 PM writes...

"Groton will remain the largest of our R&D sites and will be a center of excellence for R&D services." (from the New London Day, http://www.theday.com/article/20110201/BIZ02/110209991/1017).

R&D Services? Does that mean no drug discovery programs being led from there?

Awful. Just awful. It's hard enough trying to find a new job in the Boston area. Try Groton. Or Kent, UK.

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4. Hap on February 1, 2011 3:37 PM writes...

How does someone determine what therapeutic areas to do research in? I assume the financial estimation is better for therapeutic areas than for specific research, but is there any reason to it?

I think there's an executive meeting somewhere where they roll 20-siders to determine who stays and who goes. I guess no one realized that that all those days in your basement playing D+D could lead to a lucrative career in pharma research management. "Congratulations, your job has been eliminated in an attack by a golden dragon and three trolls. Please empty your desk and wait under the bridge for further instructions."

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5. NoDrugsNoJobs on February 1, 2011 3:40 PM writes...

Kind of good timing that the new layoffs coincide with yet another drug failure (contrave; bupropion and naltrexone) at the fda. Apparently the 4 or so phase 3 studies already done by the company on what is already a combination of old and well-tested drugs was sufficient to convince the advisory board but not enough for the fda itself (why do they have advisory committees if they do not take their advice?). Without being able to get new drugs (or even old drugs in this case) approved even with an advisory board recommendation and 4 phase 3 studies, who in their right mind will put good money into pharmaceutical research?

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6. Anonymous BMS Researcher on February 1, 2011 3:42 PM writes...

Sad day in Groton and Sandwich.

As you say "Who out there can imagine that this is the end of the process?" I have some friends at Pfizer, and I'm sure this ain't a fun day for them. At BMS we are still awaiting the next stage in our current wave of cuts. I don't think this is just cyclical, I think this is structural.

But I guess these people are gonna get more sales:
http://www.cafepress.com/pfired

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7. EB on February 1, 2011 3:44 PM writes...

@ Hap

Does that mean you could use that scroll of enchanted destruction youve had lying around since high school to reflect the attack to the boardroom?

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8. Henry on February 1, 2011 3:51 PM writes...

It would have been far more appropriate had they announced the cuts on ground hog day.

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9. Anonymous on February 1, 2011 4:15 PM writes...

At Cambridge North we were told today that there wont be any "wet chemistry" going forward. The only chemists at the site will be what are known around here as "designers" for Inflammation/Immunology, CVMED and Neuroscience. The later two will be moved from Groton to Cambridge. Get rid of the hoods (and of course the chemists) and move in the cubicles! This will most definitely increase productivity and
save the company.

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10. Anonymous on February 1, 2011 4:24 PM writes...

“Imagine if the same thing were tried in the US.” IT IS HAPPENING IN THE US. GUESSING SOME HAVEN’T BEEN WATCHING THE US NEWS TO KNOW THAT?

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11. johnnyboy on February 1, 2011 4:40 PM writes...

"Who out there can imagine that this is the end of the process?"

If I was in Pfizer-La Jolla, i'd be pissing my pants right about now...

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12. mchemst on February 1, 2011 5:55 PM writes...

I thought Obama said the recession was over.

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13. any on February 1, 2011 6:47 PM writes...

After going surviving cuts in Kzoo and AA I thought I could not get too upset over news like this. I was wrong. It was a very sad day in Groton today and I imagine it was even worse in Sandwich.

It's a waste. You do what they ask you to do, do it well and do it fast with less resources and it makes no freaking difference.

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14. jacktooth on February 1, 2011 7:03 PM writes...

Sunovion (formerly Sepracor) also had layoffs today. I'm not sure if it effected any chemists, since they outsource most of their chemistry to China.

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15. GrotonChemist on February 1, 2011 8:45 PM writes...

Here's the scoop from someone "on the ground" in Groton:
*All therapeutic area biologists moved to Cambridge. New location - probably not CPD.
*"Wet chemistry" in Cambridge is gone. (note that about 20-30 of those guys were just relocated from St Louis and legacy Wyeth locations just 6 months ago!) Unclear if any of these folks will be moved to Groton.
*"Designers" in CVMED and Neuro relocate to Cambridge. This now completes the separation of "Design Chemists" from "Synthesis Chemists".
*Groton becomes a "technical support" site. Everything going on at Groton is now "outsource-able". This appears to be the beginning of the end of chemistry within Pfizer.
*Sandwich is gone along with all the RUs there - except for pain, which will be partially relocated to Cambridge UK. No relo for Sandwich to the US - only within the UK.

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16. anon on February 1, 2011 9:30 PM writes...

From someone on the outside of Pfizer asking:

How will the division of chemistry go down? The group/project leaders in chemistry move to Cambridge and the lab heads/associates making the compounds stay in Groton if I understand correctly?

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17. fred on February 1, 2011 9:52 PM writes...

"Without being able to get new drugs (or even old drugs in this case) approved even with an advisory board recommendation and 4 phase 3 studies, who in their right mind will put good money into pharmaceutical research?"

I knew the FDA lost their mind when they pulled Vioxx. If "safer than aspirin" doesn't cut it-- what does? Homeopathic doses of chamomile tea?

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18. andreadelsarto on February 1, 2011 9:58 PM writes...

A second part of the announcement from Pfizer was that they committed $5 billion for stock repurchase. I suppose that this act means that if they have that money to spend, the most financially creative and public health improving thing they believe they can do is buy their own stock. They have no belief in their own mission as a pharmaceutical company.

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19. bbooooooya on February 1, 2011 10:21 PM writes...

"Without being able to get new drugs (or even old drugs in this case) approved even with an advisory board recommendation and 4 phase 3 studies"

Contrave was a turd for which an NDA never should have been submitted (but was as it was all the company had and yes, I am aware or Empatic---as bad if not worse). Drug barely did anything

This was a great (sad?) example of all that's wrong with biotech, though: why waste all that effort trying to discover something new to treat a cancer or diabetes when you can combine a couple of old drugs and help lardos get rid of those extra Big Macs and cheesecake with extra whipped cream?

Fortunately, one can make money shorting this type of event.

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20. GreedyCynicalSelfInterested on February 1, 2011 10:25 PM writes...

Stock buybacks are a waste of money since management always buys high and sells low (If you can find a buyer for your stock when you need the money.). Better to return the money to shareholders in the form of a special dividend rather than just decrease the number of outstanding shares.

The managers don't care about their "mission." Their product is just a product to sell and it could be sugar water, rock salt or cars that nobody wants to buy. What matters is your next promotion and how high up in the company you get. They're not doctors, scientists or engineers who have some understanding of what the meds do or know about chemistry. They're just there to apply what they learned at MBA school, which is how to manipulate people. It's theater with a little finance thrown in.

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21. bbooooooya on February 1, 2011 10:25 PM writes...

"Drug barely did anything"

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22. bbooooooya on February 1, 2011 10:28 PM writes...

less than 5% weight loss versus placebo, and less than 2% versus placebo in exercize study. Throw in cardio risk, higher BP and HR, and that is a dog that does not hunt. advisory panel was odd

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23. Fatcat on February 1, 2011 10:32 PM writes...

@19
Rightly or wrongly, shareholders are the owner of a public company (Pfizer here). Since Wall Street types and hedge funds are most likely large shareholders, they have bigger say on how to spend the cash a company is generated. They also have to answer to the people who give them money to invest. In this day and age, every one wants their money fast. So there is no long term vision, just what you have done for me lately (this quarter). This might not be in the best interests of long term investors. For Wall Street types and hedge funds, they turn over their portfolios 100+% each year. They do not look at long term. So, it is a system problem. Either you need a seismic system change. Or better yet, have the company go private.

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24. Anonymous on February 1, 2011 10:42 PM writes...

the whole industry is going to the dogs! Watch Roche, they just replaced their CFO in the middle of their layoffs/restructuring!!!! Watch out all you schleps over in Nutley...you're next! heeheehee

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25. Fatcat on February 1, 2011 10:45 PM writes...

Cosmetic companies are doing quite well, P&G, L'Oreal, Estee Lauder to name a few. At least, we don't see they lay off R&D staff. Given the difficulty of developing blockbuster drugs, big pharmas perhaps should take a closer look at cosmetics. With their highly trained chemists and biologists, super moisturizers and hair dyes are well within the reach. And on top of that, we do not even need FDA approval to see the stuff. MBA will have to earn their stripes to see the stuff.

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26. Mike on February 2, 2011 8:53 AM writes...

How much would you pay for a drug that might save your life?

Absolutely nothing. If it could possibly be of benefit it should be provided free to anybody who needs/wants it.

No wonder the cosmetic companies are doing so well - people are willing to spend any amount to look better, but nothing at all to stay out of the hospital.

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27. 4th year on February 2, 2011 9:28 AM writes...

Can anyone define "design chemist" as referred to in comment 15?

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28. Hap on February 2, 2011 9:52 AM writes...

How much would you pay for a drug that might save your life?

Absolutely nothing. If it could possibly be of benefit it should be provided free to anybody who needs/wants it.

No wonder the cosmetic companies are doing so well - people are willing to spend any amount to look better, but nothing at all to stay out of the hospital.

I don't know...there are drugs like Provenge, for which somebody's paying $90K. Lipitor still makes some money too - heck, with a marginal improvement over generic, Nexium's raking in the cash.

In addition, the supplementeers seem to be making a good living touting snake oil and claiming it does everything but wash your car. If I had to guess, that's the model pharma management is hoping to follow - no cost of goods, no research or trials, just find enough suckers to gull and sell, sell, sell. From snake oil to medicine we came and to it we shall return, I guess. I don't think this is what people like Elion had in mind.

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29. luvyurnmr on February 2, 2011 10:54 AM writes...

Mike, what I think they are referring to as a "Design chemist" is a molecular modeler or computational chemist. Those individuals never set foot in a lab (though, perhaps some of them should). They generate proposals for synthetic chemistry based on some starting point, whether that is a bunch of molecules that behave similarly on a protein target or they have a crystal structure of the target itself so they can see what the heck they're doing.
Drug Design and Med Chem have had a rocky relationship for years. Well, for one, designers have egos the size of small planets. But they can't actually make the molecules. The med chemists do that. So, they really are beholden to one another. I'd give the med chemists the edge. There's a lot they can do without a designer. It's trial and error for both sets of chemists. Still, with a good crystal structure and if the med chemist is willing to try some design of experiments types of things, there can be a good working relationship.
I suppose the designer will have a much easier time of it now. If he/she comes up with an idea, they just call Hyderabad and order it.
Expect designers' egos to expand to size of solar systems.

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30. anon on February 2, 2011 11:21 AM writes...

#25

Cosmetics are regulated by the FDA.

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31. Anonymous on February 2, 2011 11:31 AM writes...

#29:

Designers in the Pfizer world *are* the medicinal chemists, designing molecules for synthetic chemists to make, using information from computational chemists, assay results and so on.

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32. Anonymous on February 2, 2011 11:33 AM writes...

#29:

#31 here again. Sorry, hit post too soon - of course they also rely on their experience in medicinal chemistry to design their molecules!

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33. Anonymous on February 2, 2011 11:47 AM writes...

I am hunting for jobs these days as a fresh PhD.
These news keep telling me that "Get out of Science ASAP". I'll try.

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34. Fatcat on February 2, 2011 12:14 PM writes...

@30

True, but the hurdle is much lower than Rx drugs. You don't need to conduct clinical trials, huge difference.

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35. CR on February 2, 2011 12:16 PM writes...

#29 and #31:
Pfizer recently went to a model that separated out the medicinal chemists into two "bins" - designers and synthetic chemists. These are not computational chemists or modelers (by and large) they are the traditional medicinal chemists. The "designers" are now just charged with designing compounds for their projects (just like a traditional medicinal chemist would be expected to do) - but they do not then go make the compounds. They hand the "designs" off to the synthetic chemists to make. One SVP from Pfizer "tried" to explain this model and how it made sense because not everyone wants to design and some just want to be synthetic chemists and work at the hood (Ph.D. level). I think everyone in the room during this explanation could see the writing on the wall that the synthetic chemists had a very short shelf life and would be out-sourced very quickly. There was also talk about reward systems for both, yada, yada, yada.

In a nutshell, new hires (if there were any) would come in at the synthetic chemist level and would then have to work up to the designer level (if they so chose). This clearly was a model based upon outsourcing the synthetic portion of the equation - although based on yesterday's news it may not matter at all if you work for Pfizer.

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36. Wagonwheel on February 2, 2011 1:12 PM writes...

There are axes swinging at all levels. The most visible to those working in the labs is severing design and synthetic chemists. Beyond that most R&D has now adopted the same model. Biologists are often separated according to those who work within a therapeutic area and those which offer enabling assays (screen the compounds and do the work). All this separation makes it easy to keep shaving off those doing the work and replacing with external folks. Then of course, there is one almighty axe, which rests out of sight and is more difficult to see coming. It swings down from the upper echelons and severs enture R&D sites regardless of their structure, organisation or previous success. All part of the progression to large pharma operating in development only...

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37. CR on February 2, 2011 1:59 PM writes...

Wagonwheel...
Couldn't agree more that big pharma is moving to the development only stage. Question then becomes: developing what? And from where?

This leads back to the discussion regarding Dr. Collins' NIH "Drug Discovery" institute. I know there were quite a few naysayers on this board (and other boards) about how the government/academics cannot do drug discovery. But I have to say I have zero confidence in the pharma companies actually being successful anymore. Plus with all of these cuts, there are going to be zero discovery jobs in Pharma in 5 years (or at least in the US). So why not have the NIH do some of the early stage discovery work to try and de-risk some projects. Again, there will be those that don't feel this appropriate and that there is no way the NIH will be successful - to that I counter - do you really believe pharma is a.) going to be successful and b.) nobody else can do this? The curtain has been revealed - drug discovery is not some mystical process. I think NIH bureaucrats are not any worse than pharma MBA's.

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38. Hap on February 2, 2011 2:19 PM writes...

How many people will be doing discovery chemistry anywhere, though? People will do it at small companies for the time being, but as it becomes clear that those are the only discovery drug R+D jobs left in the US, how many students will be clamoring to get their spots?

An analogy might be: how many people would be playing Division I football if there wasn't a professional league? Some would because it would pay for school and other would because they love it, but lots of the people who go to school go for football, and as a gateway to a football career. If the only future career is in semipro (or maybe Canada), how many of those people would be in football? If the only career in developing drugs is at small, high(er) risk companies, how many people will continue to find drugs, and what pipeline is there going to be to develop?

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39. Anonlot on February 2, 2011 2:30 PM writes...

The biggest problem in drug discovery and development is that no one would admit that luck is the crucial factor. Every scientist claims that he/she knows the pathway to success (kind of self preservation). The truth is that no one has any certainty that a compound could be a human drug since all the research is done on animal before going into clinical trial. More than 99% of the money spent in drug discovery do not lead to a drug. That's why a government agency should not waste tax money in drug discovery. The tax money is better used in disease prevention. Putting a limit of salt in processed food would significantly reduce the incidence of hypertension.

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40. CR on February 2, 2011 2:38 PM writes...

I don't believe your Division I football - pro football is an appropriate analogy. I would suspect that it is less than 2-3% go on to a pro football career and as such, the vast majority of players know that playing Div. I football is not leading to a football career. If you are going to Alabama et al., maybe you have aspirations of playing pro - but someone that goes to Kansas State does not have those same aspirations (they may because they are 18 and naive, but will soon find out getting an education is their only option). So, a pro football career is not the only option for a Div. I football player. Now, if the schools stopped giving out scholarships, the number of players might drop off because their chances of turning pro and thus paying for their education is quite small.

As it is now, there are too many R&D scientists for jobs. Yes, as you point out, if there are fewer jobs to be had, fewer people will enter the disciplines and maybe that's actually good. Supply and demand and all.

I think people will still go into the high(er) risk companies - they do now and have for the past 20 years.

Either way you look at it, there will be fewer numbers of people/businesses/labs doing drug discovery in the future.

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41. Stubbie on February 2, 2011 2:58 PM writes...

"The curtain has been revealed - drug discovery is not some mystical process. I think NIH bureaucrats are not any worse than pharma MBA's."

On the contrary, given the scarcity of new drugs (from ALL sources), it apparently is some kind of mystical process. My worry about shifting discovery to a governmental agency is that it will be even more expensive than it is in industry and that there will not exist the appropriate checks and balances to end dead-end projects.

And yes, the split of chemistry at Pfizer into design and synthesis has been writing on the wall. No chemists have been project leaders for some time--chemistry has been viewed by Pfizer as a support function for some years now.

My heart goes out to all those affected by the recent announcements. Pfizer closed two sites on me, and I took the package the second time. The writing was on the wall then, too.

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42. CR on February 2, 2011 3:35 PM writes...

"On the contrary, given the scarcity of new drugs (from ALL sources), it apparently is some kind of mystical process."
I don't believe drug discovery is some mystical process - industry has just lost its way recently and has not adjusted properly to the changes at hand (i.e., trying to get PoS drugs approved - dogs are dogs and they should know that). I think most people on this board also know the process isn't something magical either, just that management has gotten in the way all too often.

The NIH initiative is not about going through the entire drug discovery/development process. So the whole argument about government being more expensive than industry isn't a valid argument.

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43. Hap on February 2, 2011 3:42 PM writes...

But my point would be that D1 football attracts the talent it does because there is a pro league afterwards - if there were no chance to go anywhere after school, then much of the best talent in football would do something else.

Maybe there shouldn't be as many drug chemists, but if the problem is "not enough drugs" (which is what the problem seems to be - too much R+D costs and not enough salable drugs), then cutting the supply of the people who find them isn't going to help. Eventually, the big companies will be stuck chasing the candidates made by the decreased number of startups (fewer drug people meaning fewer startups), which will mean that they'll have to pay more to get them while not minimizing their uncertainty. It doesn't seem like an effective strategy for improving drug development.

On the other hand, there aren't anywhere near enough spots in pro football to accommodate the people that play it in college. The process for determining who's good enough to play in the NFL and who's not seems arbitrary, and so most of the people who play football are discarded. Without pro football, fewer people would go to school for football, and would find better ways to use their talents - it depends on the worth of what we get from football versus the improved output of people using their skills for other things. At the moment, there doesn't seem to be anything that looks valuable - if we don't have a manufacturing economy, and we're dumping the intellectual part of the economy, what's left?

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44. Anonymous on February 2, 2011 3:56 PM writes...

@17

"I knew the FDA lost their mind when they pulled Vioxx."

No! Merck voluntarily pulled Vioxx, perhaps the main reason why the FDA is behaving so badly now. Instead of letting the FDA do its job to blackbox (or withdraw) or Vioxx, Merck made the FDA look like idiots not doing their job right with Vioxx. Thanks to Peter Kim at Merck for making the entire Pharma industry suffer the consequences of his stupidity.

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45. 4th year on February 2, 2011 4:12 PM writes...

If medicinal chemist are now separated from "synthetic chemist" can I ask exactly what qualifications the "designer" chemist have? Are they just synthetic people with more experience or do they have other qualifications? This is from a 4th year grad student who apparently wasted 4 years doing synthesis for nothing. Are there any other skill sets that would help in crossing over to the "designer" side?

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46. Not the FDA on February 2, 2011 5:31 PM writes...

The commenters blaming the FDA for the decline of industry are off-base. To get a drug approved, you generally only have to prove it is more effective than placebo. True, FDA has been making that harder to do in recent years, but mostly by requiring more objective endpoints and more robust clinical trial designs. A lot of the drugs that aren't getting approved -- such as the latest three anti-obesity products -- are ones we don't need because they don't actually improve anyone's life. That undermines the business model and makes it harder to run a profitable business, and these are real problems for the sustainability of the industry. But lower approval standards isn't the solution.

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47. Not the FDA