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Mergers Wreck Pharma R&D, Says Ex Pfizer Chief
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- Publication：2011/8/2
Mergers and acquisitions in the pharmaceutical industry will significantly shrink drug research over the long-term, according to former Pfizer R&D chief John LaMattina.
Writing in the online journal nature.com, LaMattina express concern over the productivity of pharmaceutical R&D in an era where mergers and acquisitions have resulted in the widescale closure of research divisions.
"At a time when there is a major need for new treatments for conditions such as Alzheimer's disease, drug-resistant infections and diabetes, such a trend is alarming," says LaMattina.
Citing the example of Pfizer acquisitions over the past few decades, LaMattina points out that before 1999, Pfizer had never made a major acquisition. Over the next decade, it acquired three large companies — Warner-Lambert, Pharmacia and Wyeth — as well as multiple smaller companies, such as Vicuron, Rinat and Esperion.
To meet its business objectives in this time frame, Pfizer closed numerous research sites in the US, including those at Kalamazoo in Michigan and Skokie in Illinois These sites housed thousands of scientists, and were the birthplace of many major drugs, including atorvastatin (Lipitor), amlodipine (Norvasc) and sildenafil (Viagra).
The same pattern has been observed after most of the mergers and acquisitions by other major pharmaceutical companies during the past decade, according to LaMattina.
The ex research guru also says that although R&D is the most important function of a drug company, it is the last involved in merger discussions and that for some time after a merger no new research is likely to be started, resulting in a "numbing" effect on innovation.
"It is hard to quantify the impact that such uncertainty has on productivity, except that it is negative, and probably strongly so in many cases," says LaMattina.
"Leaders of organisations who have completed multiple mergers may express the view: 'We've done this before and we know how to do it'. Mechanically, this may be true, but for many employees who survive mergers, the thought of repeating the exercise is not embraced, and could prove to be numbing to their motivation."