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First details emerge of Pfizer site closures

Published on 20/10/09 at 11:16am

 

The completion of Pfizer's deal to acquire Wyeth has been followed swiftly by news that a number of manufacturing and research sites are to close.

Pfizer had already said back in January when the $68 billion deal was announced that 19,000 employees were likely to lose their jobs, but this is the first time that specific information about site closures has been divulged.

Top of the list for closures is Pfizer's own unit in Bridgwater, New Jersey, which employs 300 people focuses on manufacturing and process development, and Wyeth's Great Valley building, which handles administrative functions such as information technology.

Two Wyeth facilities in Collegeville, Pennsylvania will also be closed, although the main pharmaceutical campus there will be kept as the focal point for Pfizer's speciality medicines business, including vaccines.

Wyeth's corporate headquarters in Madison, New Jersey, will also stay open and take charge of diversified healthcare, including consumer and animal health businesses.

Further decisions on the expanded group's manufacturing portfolio will be made within the next six months, according to the company's chief financial officer Frank D'Amelio, in a Bloomberg interview.

Pfizer has said it expects $4 billion in savings by 2011 from plant and programme rationalisation, on top of ongoing restructuring efforts expected to cut costs by $2 billion.

Another country waiting for a decision with bated breath will be Ireland, which has 13 facilities and around 5,000 staff now working under the Pfizer banner in the wake of the merger, with a heavy emphasis on manufacturing.

Meanwhile, the fate of the R&D units will be known in the next 30 to 60 days, said D'Amelio.

Pfizer has already announced a reorganisation of its R&D into two units - PharmaTherapeutics (headed by Mrtin McKay) and BioTherapeutics (headed by Mikael Dolsten).

Deutsche Bank analyst Barbara Ryan has suggested Pfizer will keep R&D spending at the same level ($8 billion) as 2008, equivalent to a 30% reduction from the spend across both companies in that year.

Standard & Poor downgraded Pfizer's rating from AAA to AA on the back of the Wyeth acquisition, citing "significant additional borrowings" and a significant ... proportion of revenues exposed to generic competition through 2011."

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