PharmaTelevision - Pfizer: An Ideal Development Partner

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Video title: Pfizer: An Ideal Development Partner

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In this episode of PharmaTelevision News Review, Paul Larsmon talks with Doug Giordano, Vice President, Business Development at Pfizer.

Filmed at BIO-Europe 2009, they discuss:

• the strategy behind Pfizer’s merger with Wyeth and how the 2 companies have integrated
• partnering with GlaxoSmithKline to focus on HIV/Aids
• the trend in Big Pharma partnering
• what Pfizer is looking for in a potential partner
• Pfizer’s emerging markets business unit
• “focus” in a difficult economic climate
• innovation and blockbuster drugs
• the future of the pharmaceutical industry in the next year

Full video transcripts are available with PharmaTelevision Premium Content. Click here to buy a subscription or sign up for a 14 day free trial.

The strategy behind Pfizer's merger with Wyeth and how the 2 companies have integrated.

Paul Larsmon:

Hello and welcome to Bio Europe 2009 here in the Austrian capital of Vienna. With me is Doug Giordano Vice President Business Development from Pfizer. Doug Giordano first of all we can't ignore the merger with Wyeth merger . Lots of column inches have been written about it but now I got you here in the chair what was the rationale behind this huge huge takeover?

Doug Giordano:

the rationale stems from our strategies so that the company had spent a lot of time thinking about the areas that we really wanted to strategically advantage in any type of business development transaction. We had step back with basically organize the company into business units trying to split our big company into smaller units that could take advantage of the specific dimensions and dynamics of those areas, we have a primary care business, a specialty business an oncology business and merging market business and established product business so those became kind of our strategic filter. We knew we needed to move forward in large molecules and biologics. We wanted to have a presence in vaccines. We wanted to diversify the company. We wanted to basically diversify not only in terms of the business units themselves but also in terms of the modality that the actual technical modalities of large molecule small molecule not be so dependent on the small molecule business that we had in historically, basically prior to the merger about 90% of our revenue was coming from the small molecule business and you know small molecule business is prone to you know periods of patent expirations where you see your sales basically going away. So we are trying to you know create a more stable revenue base trying to build equip you know build capabilities in areas that we were not and we looked at a variety of different ways to do that. we looked at trying to build this by streaming together a series of companies but quite frankly we couldn't find a series of assets that we could acquire at a price that we thought was appropriate and with kind of an execution risk profile that we saw was tolerable, when we compared that to doing a deal with Wyeth, Wyeth gave us a large presence in vaccines. Wyeth has given us large presence and great capability in biologics. It's also advantaged us in therapeutic areas that we have categorized as invest to win areas like inflammation areas like neuro science, Alzheimer, areas like infectious disease and oncology. Wyeth also gave us diversification so it took our revenue base which again had been by about 90 % in small molecules and in 2012 we estimated it will be about 55% in small molecules so you know platform diversification in that respect in terms of our revenue concentration again 90% in pharmaceuticals after the Wyeth merger will be much more diversified company about 75% in bio pharma 25% in other 0.03.50 that includes consumer and nutritional and animal health. So from our perspective we had a strategic vision for what we wanted the company to be and we thought that we can get there in a variety of different ways, we thought the best way to get there and the quickest way to get there to create a platform for growth in the future was to do a merger a with Wyeth.

Paul Larsmon:

mergers like this take a awful lot of corporate energy and is it a danger that you could sort of run of steam, you spend so much energy merging the two corporate cultures that you are actually stop producing new drugs?

Doug Giordano:

Yes I mean there is always that danger. We've in our history and I have been with Pfizer for 17 years so I have seen the company go through remarkable transformation. We have been through couple of large mergers before this. We have learnt from that and try to do things differently in the integration with Wyeth we tried to ring fence certain parts of the business to make sure that we keep people concentrated on the innovation business so we don't see a distraction. We also try to do it early on the integration. We tried to basically establish who the senior leaders of the organization would be and it was a mix of Pfizer people and Wyeth people and that helped to basically calm the organization in a large way and gave people on both sides Wyeth side and on the Pfizer side kind of bind into the vision. So that has helped, clearly there is there is the opportunity for distraction but one of the values of the adding structures in terms of the business units is we've tried to take a big business and split it up into smaller pieces, pieces that could be more focused on performance and we are hoping that that would pay dividends in terms of keeping people focused on what they need to do, people keep up focused on driving the near term business and also focused on innovation because after all is said and done the point of all of this is to create this diversified stable platform so that we can free people up to do what we are charged to do which is to innovate, to try to create you know solutions to unmet medical needs whether they be through innovation in the laboratory or innovation in a business model in the emerging markets.

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Doug Giordano

Vice President, Business Development

Current VP, Business Development at Pfizer Inc, Past Consultant at Booz allen & Hamilton, Education Cornell University - S.C. Johnson Graduate School of Management Duke University

Pfizer

Pfizer is the world%27s largest research based biomedical and pharmaceutical company; in 2007 the company earned $448.4 billion in revenues and invested $8.1 billion in research and development. Its headquarters are located in New York with research and development faculties based in the US and in the UK. Pfizer produces the number-one selling drug Lipitor; the neuropathic pain/fibromyalgia drug Lyrica; the oral antifungal medication Diflucan, the long-acting antibiotic Zithromax, the well-known erectile dysfunction drug Viagra, and the anti-inflammatoryCelebrex. Recent innovations include Sutenta novel cancer medicine that both cuts off the blood supply that feeds tumors and destroys cellular reproduction, and Chantixa new prescription medicine and accompanying support plan designed specifically to help smokers quit.