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Pfizer wants manufacturing 'efficiencies' in 2013

By Gareth Macdonald , 30-Jan-2013
Last updated on 31-Jan-2013 at 11:45 GMT

Pfizer's CEO has raised the possibility of more cost cutting in manufacturing operations in 2013 to offset the impact of patent loss for key products.

Ian Reed made the comment during the US drug giant's Q4 earnings call earlier this week, telling attendees that: “Continuing to work on managing our expenses and driving ongoing efficiencies within our manufacturing network” would be a focus for Pfizer in 2013.

He added that the plan is to establish a “lower and flexible cost base that allows us to respond to pricing pressures and our upcoming LOEs [loss of exclusivity].”

Pfizer did not say whether the efficiency drive will involve job cuts or facility divestitures, but given the firm’s track record such measures are a distinct possibility.

In addition, the firm has already announced some manufacturing cutbacks it will make this year. In June it said that it would reduce headcount at two facilities in Cork, Ireland citing increased competition from generic manufacturers as the driver .

If Pfizer does make any cuts, contract manufacturing organisations (CMOs) may benefit. When the firm announced its intention to exit its R&D UK site in February 2011 it also said that it would seek to replace the shed capacity through external partnerships .

Biosimilars

One area likely to be spared in any cuts is biomanufacturing as – according to worldwide R&D president Mikael Dolsten – leveraging this production capacity is a key part of Pfizer’s biosimilar strategy.

When asked how long before Pfizer launches its first biosimilar drug Dolsten explained that: “We just completed successfully with our first biosimilar” and the firm is “exploring plans for a Phase III opportunity this year.”

He also said Pfizer is developing a biosimilar version of rituximab which is about to complete in Phase II adding that: “We’re using the deep skills in biopharmaceuticals and manufacturing in Pfizer to provide quality data.”

Company split?

Pfizer also floated the idea of splitting its businesses into units focused on innovative drugs and established products, respectively.

CEO Ian Reed said: “We will I believe move towards separate management [for its innovative and established products business]. And at that point, we’ll be able to evaluate whether shareholders would prefer to have the option to invest in two distinct companies or not.”

How such a split would impact partners like Mylan , Strides Acrolabs, Hisun and Loboaratorio Teuto Brasilerio, which make generic versions of Pfizer products for the Japanese, Indian, Chinese and Brazilian markets, was not discussed.

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