About Pfizer Inc.
Pfizer is one of the world's largest research-based pharmaceuticals firms, producing medicines for ailments in fields including cardiovascular health, metabolism, oncology, and inflammation and immunology. Its top prescription products include cholesterol-lowering Lipitor, pain management drugs Celebrex and Lyrica, pneumonia vaccine Prevnar, and erectile dysfunction treatment Viagra, as well as arthritis drug Enbrel, antibiotic Zyvox, and high-blood-pressure therapy Norvasc. The firm also makes and sells generic drugs and consumer health products. Pfizer operates around the world but gets half of its revenues from the US.
Pfizer operates through two business segments -- Pfizer Innovative Health (IH) and Pfizer Essential Health (EH). IH is the larger segment, accounting for some 60% of total revenue. That segment focuses on the development and commercialization of novel medicines and vaccines and consumer health care products. It is engaged in areas including internal medicine, oncology, inflammation and immunology, and rare diseases.
The EH segment (which brings in about 40% of revenue) manages Pfizer's legacy brands that have lost or will lose patent protection and market exclusivity. It also manages the company's branded generics and biosimilars. The segment has research and development operations and provides contract manufacturing services.
Pfizer currently has 10 blockbusters, or products that bring in more than $1 billion in revenue: Lyrica, the Prevnar13 suite, Enbrel, Eliquis, Ibrance, Lipitor, Norvasc, Sutent, Xeljanz, and Chantix. The company is working diligently to launch new blockbusters from its robust R&D pipeline to make up for off-patent losses. It has dozens of projects in clinical stages of development, including drugs for psoriasis, diabetes, lung cancer, pain, and infections.
Pfizer merged its consumer health operations, include such leading brands as Advil, Centrum, and Robitussin, with those of GlaxoSmithKline in 2019. Pfizer retains a 32% stake in the joint venture.
Also in 2019, Pfizer announced plans to merge its off-patent branded and generic drug unit, Upjohn, with Mylan, a leading manufacturer of generic drugs. Pfizer will retain a 57% stake in the new entity.
While the US is Pfizer's single largest market (accounting for half of all revenues), the drug maker has a strong global presence. It operates in more than 90 international markets, including Japan (nearly 10% of sales), Australia, Canada, Finland, New Zealand, Scandinavia, South Korea, and countries in Western Europe. The company is also growing in emerging markets such as Brazil, China (nearly 10% of sales), India, Mexico, Russia, and Turkey.
Pfizer has major manufacturing facilities in Belgium, China, Germany, India, Ireland, Italy, Japan, Puerto Rico, Singapore, and the US. In all, it operates some 60 plants around the world.
The company sells its products in more than 125 countries globally.
Sales and Marketing
Pfizer markets its pharmaceuticals directly to doctors, hospitals, nurses, pharmacists, retailers, clinics, benefit management firms, managed care organizations, employer groups, government agencies, and to patients themselves. Most of its sales are conducted through wholesale distributors including McKesson, Cardinal Health, and AmerisourceBergen, which combined account for around 40% of annual revenues.
The company also markets directly to consumers in the US through direct advertising, including television, print, and digital ads, as well as in-store promotions. It sells its consumer health care products through distributors, pharmacies, retail chains, grocery stores, convenience stores, and other channels.
Advertising expenses total around $3 billion annually.
With the exception of 2016, Pfizer's revenues have been trending downward for the past several years. Net income took a steep decline from 2014 through 2016 but rebounded in 2017.
Revenue fell less than 1% to $52.5 billion in 2017. That slight dip was due to a shorter selling period (by one day) that year, plus the unfavorable impact of foreign exchange. Brands that had strong growth included Eliquis, Xeljanz, Lyrica, and Ibrance.
Net income nearly tripled to $21.3 billion in 2017. Factors driving that increase included a steep decline in restructuring charges, and acquisition-related costs, a 9% decrease in costs of sales, and a $9 billion benefit for income taxes.
The company ended 2017 with $1.3 billion in net cash, a 48% decline from what it had at the end of 2016. Operating activities provided $16.5 billion, while investing activities used $4.7 billion (versus $7.8 billion used in 2016) and financing activities used $13.0 billion. Financing activities included the issuance of long-term debt, the payment of cash dividends, and repayments on long-term debt.
Pfizer has ambitions to become the premier pharmaceutical firm by 2020. It has been challenged in that goal by numerous patent expirations and failed merger attempts, but has been successful in getting regulatory approvals to launch and acquire new products.
Following a failed merger with Ireland-based Allergan in 2016, Pfizer began considering its options including making new acquisitions, divesting various operations, and splitting into two businesses. In 2016, the company announced that it would not split into two but would rather continue to operate its two distinct businesses with their own strategies for growth and increasing operational efficiency. In the IH segment, the focus is on expanding its portfolio through R&D and acquisitive means. The EH segment is focused on managing its portfolio, strengthening its core brands while divesting others.
In 2019 Pfizer struck a deal to merge its off-patent branded and generic drug division, Upjohn, with generics manufacturer Mylan. Pfizer will own 57% of the new entity, while Mylan shareholders will retain a 43% stake. Mylan adds a robust portfolio of generics in fields including neurological, cardiovascular, and infectious disease care. Upjohn makes legacy products including Lipitor, Celebrex, and Viagra and has a strong sales infrastructure that will allow Mylan to expand its sales into new markets.
Also in 2019 the company combined its consumer health division with the consumer health operations of GlaxoSmithKline (GSK). The resulting joint venture is 68%-owned by GSK. Prior to that deal's announcement, Pfizer had been seeking buyers for the unit.
In early 2018 the company announced it would shut down its Alzheimer's and Parkinson's disease discovery and early development operations; it will redistribute research funds to other areas.
In terms of R&D, Pfizer is concentrating on biosimilars, immunology and inflammation, metabolic disease and cardiovascular risks, oncology, and vaccines. Pfizer has also increasingly relied on partnerships to build its R&D activities, including some team-ups with fellow top pharma companies such as Bristol-Myers Squibb (cardiovascular and metabolic candidates), and GlaxoSmithKline (HIV). In 2018 the company spun off much of its neuroscience R&D business to a new company named Cerevel Therapeutics (of which it holds a 25% stake). It made a similar move in 2017 when it released its rare disease assets to a new company named SpringWorks.
Recent regulatory wins include the 2018 FDA approval of VIZIMPRO for the treatment of lung cancer.
In 2018 there were shortages of Pfizer's life-saving allergy medication EpiPen, and in some markets it was out of stock. Separately, the company recalled packages of Children's Advil because the dosage cup was marked in teaspoons rather than milliliters (a problem which could lead to overdoses).
Mergers and Acquisitions
Pfizer has made a number of acquisitions to beef up its development-stage and commercialized offerings and ward off losses from patent expiration.
In 2019 Pfizer acquired Array BioPharma Inc., which develops drugs to treat cancer, for about $11.4 billion. Pfizer said the deal would strengthen its biopharmaceutical business and its oncology-related offerings. Array's drugs BRAFTOVI and MEKTOVI are used in combination to treat colorectal cancer. As part of Pfizer, Array has access to greater research resources and wider marketing reach.
Also in 2019 Pfizer acquired Therachon, which is developing rare genetic disease treatments, for some $340 million plus $470 million in potential milestone payments.
Pfizer was founded by cousins Charles Pfizer and Charles Erhart in 1849.
235 E 42ND ST
New York, NY 10017-5703
Phone: 1 (212) 733-2323
Employer Type: Publicly Owned
Stock Symbol: PFE
Stock Exchange: , NYSE
COO: Albert Bourla
EVP Business Operations and CFO: Frank A. D'Amelio
Chairman and CEO: Ian C. Read
Employees (This Location): 2,500
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