Do Big Dollars Affect the Little Guys?
by Jeremy on Jan 23 2009 (3950 Views)
D-Lowe certainly beat me to the punch this morning, but in my defense, I was working on a time-sensitive reaction in the lab when I heard the news.
In the midst of economic turmoil, an interesting deal has been proposed—one that hits home to a lot of R&D chemists. Both Bloomberg and the WSJ are reporting that Pfizer is in talks with Wyeth to merge the two companies for an estimated $60 B. The rumor, among several media outlets, is that Pfizer’s backup plan is to buy Bristol-Myers Squibb or Amgen should the Wyeth deal sour.
Recently, both companies have had their fair share of time in the media spotlight (apart from the proposed merger). As reported by Chemistry World last December, Wyeth announced it would revamp its R&D business model by minimizing the number of major areas of therapeutic research while retaining the same research budget (c. $3 B). Wyeth plans to focus on the following 6 areas: oncology, central nervous system, vaccines, musculoskeletal, metabolism and inflammation. I can tell you (from my experiences in pharma) that it’s a better strategy put 20 researchers on different aspects of one project (a concerted effort) versus working in 20 different directions.
Meanwhile, in DC, the USPTO recently agreed to allow Pfizer to “repair” its invalid patent for Lipitor thus gaining US exclusivity until 2011 (more details here). By the amount of revenue generated in sales ($13 B in 2007 alone), Lipitor is considered the best-selling drug in the world. For whatever it’s worth, the controversy was sparked by the challenge and subsequent rejection of one of Pfizer’s prized patents in 2004. Essentially, exclusivity keeps the cash cow alive for another couple of years while other therapies are pushed through the FDA. You can find a more detailed description here.
While the deal may be good for Wall Street, I fear that it may do more harm than good, especially in the world of chemical employment. As someone who’s currently hunting the job market (and watching several of my peers do the same), I see shrinking job opportunities in pharma. Often, as two large companies merge, it’s usually followed by a period of hiring freezes (there become a lot of replicated jobs) then the new mega company begins to tighten the belt by cutting spending and laying off thousands of employees.
I hope we can all make it through these shaky and uncertain times.
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