Pfizer’s announcement of its plans to shut down its Sandwich (Kent, UK) facility – which since its establishment in 1954 had developed into a hub of corporate life science R&D in Europe – continues to provoke outcries of all sorts.
What seems to get lost in the hue and cry about 2,400 researchers and their supporting staff facing layoff (or, in a few selected cases, offers for relocation to the United States) during the next two years is what else Pfizer said in its press release: “ Driving this decline [i.e., the R&D expense cut in the range of $1-2 billion] is the planned reduction in the number of disease areas the company will focus on … as well as a realigned R&D footprint.“
In other words, what we have seen happening for years is now spelled out, is being “given a face” … a development that is accelerating. Big Pharma, which has been in-licensing or buying the great majority of the drug candidates it eventually brought to the market, is increasingly doing what makes most sense to the MBA-displaying Controllers: pull out of research. Instead, concentrate even more on what we can do best by leveraging our greatest asset (capital), namely late-stage development and marketing (most especially, marketing). Keep the investors, who provide us with said capital assets, happy by “realigning the R&D footprint.” (As every Controller knows, R&D is a constant drain on resources, and these mad scientists, well…) Wall Street analysts have already reacted with enthusiam, or so I hear.
Of course this strategy doesn’t stop here. Pull out of Europe, where you need to complete a dozen forms before you can even work with recombinant E. coli in your lab; go back to the U.S. instead. Specifically, pull out of the United Kingdom where you can’t do preclinical research unless you can find employees who enjoy the thrill of being shot at by animal rights activists. The world is large and globalized; lets go to China where you don’t get every construction project delayed for years under the pretense of an “Environmental Compatibility Evaluation,” with protesting mobs in front of your gates regardless of what you say and do. Makes sense, doesn’t it?
IMHO, in the end everybody in the game will get what is being paid for. Big Pharma will get more of its current image of a commodities marketing organization. Investors will maybe stop selling Big Pharma stock for a while until they shift their assets regardless, to cash in on more promising targets. Europe gets its slow life and deepening slumber, and full insurance against the harshness of life for everybody. The U.S. gets its sense of decline assuaged for a moment, and at one spot. China gets a step closer to … everything it wants to be eventually.
And small, agile and risk-taking drug discoverers and early-stage developers might get their chance too. As we have said before in this blog, drug repurposing and intelligent reformulation will be a big part of that. However, if a truly new chemical entity actually makes it from the lab bench to the market, it will likely have been discovered and initially characterized by a small outfit where business-focused science rules. H.M. Pharma Consultancy exists to help such outfits.