By JANE ALLIN
Chief Research Analyst
Prior to the merger of Pfizer and Wyeth there was speculation as to the fate of the mares and foals at the callous hands of the PMU farming industry. Would Pfizer continue to market the widely controversial Premarin® family of HRT medications, or would they resolutely assume accountability and pursue alternatives that would be safer and more humane?
On January 26, 2009 Pfizer agreed to purchase Wyeth for $68 billion in hopes of creating, a broad, diversified portfolio of customer-centric businesses on a global scale to respond rapidly and effectively to meet changing health care needs. Two years prior to this acquisition, Pfizer’s newly appointed CEO, Jeffrey Kindler formerly a McDonald’s executive, was quoted as saying that big mergers weren’t a smart move – that they destroyed more value than they created. By October 15, 2009, the acquisition was finalized and Pfizer/Wyeth became one.
By many, this merger has been called a “marriage of weakness” wherein Pfizer is clambering with the looming patent expiration of Lipitor® which accounted for 40% of their total profits in 2005. Since this time, profits have significantly declined for the best-seller cholesterol lowering drug and Pfizer has nothing new in the pipeline for the next several years. Meanwhile, Wyeth continues to face obstacles for many of its promising drugs including CEE-containing Aprela® along with the ever-nearing approach of the Premarin® patent expiration (2012).
Historically, Pfizer’s reputation as an innovative drug maker is less than stellar and they are renowned for securing drugs with several years of patent protection, high sales profits and potential future blockbusters in late stage testing for FDA approval. Some forget that Lipitor® was a Warner Lambert patented drug, and the primary reason for the hostile take-over of the company.
Clearly Pfizer purchased Wyeth for its assets and lucrative blockbuster drugs in hopes of supporting its inability to innovate on its own but it certainly didn’t pay for Wyeth’s moral and ethical values. Pfizer’s code of conduct and ethical platform were nicely in place well before Wyeth moved in with its own secrets and immorality. Here are a few examples of how principled their business strategy is and the intrinsic conflicts of interest that exist between Pfizer, the big, bad wolf and their customers, a global nation of sacrificial lambs.
Let’s start with illegal drug promotion. As well as paying kickbacks to market drugs, doctors received free junkets to classy resorts, and were paid to promote and prescribe certain drugs in violation of kickback laws. Many drugs were promoted for off label uses (a BIG no-no!) with repeat offenses continuing even after past transgressions were detected.
But wait, it gets better.