Pune:The world’s biggest investor in drug research and development with an annual budget of $7 billion (Rs27,580 crore) a year, Pfizer Inc., is shifting to a collaborative model in research in India, China and other Asia-Pacific locations, away from its traditional approach of handling such projects in-house.
The move is to balance the cost and the quality of research while keeping the budget flat for some more time without reducing the number of drugs under research.
The decision comes at a time when the company’s research budget is expected to remain flat for the next few years due to general pressure on profitability and the patent expiry of some its biggest drugs in the coming years.
Pfizer’s senior vice-president and president of global R&D, John L. LaMattina, said: “As far as expansion in R&D is concerned, the company’s focus would not be to increase its own facilities and resources, but to collaborate with reputed players to tap research capabilities.”
In the past, Pfizer consolidated R&D with a focus on a few sites but in future “you will see investments around the globe,” LaMattina, who is visiting India, said in an interview on Sunday. “What we want to do is maximize flexibility. We don’t just want to have captive resources. We want to tap into resources all around the globe, and to do that, it means building partnerships, be it in India, Korea, Japan or Europe. Great research is done in India, depends on what you have and what we need and if it matches, we are open for such collaborations that will help us reduce cost and maintain quality,” he added.
LaMattina, who retires early next year, said the company wanted to move beyond just testing in India. “Pfizer has been outsourcing a good portion of its drug development services to India and at present it has about 44 new drugs under clinical trials here involving 143 medical institutions and at least 1,800 patients,” he said. “The company would like to have partners in drug research as well in India, as they can deliver quality intellectual contribution,” he added.
The global drug maker, which has a speciality packaging supply contract with India’s Bilcare Ltd for clinical trials, is also in talks with a few leading drug makers and research-focused companies to initiate collaborative projects in India.
Earlier this year, Pfizer announced major cost-cutting measures; the company is in the process of reducing its staff by almost 10,000 or 10% of its global workforce in a bid to save $1 billion in costs by the end of 2008. It also plans to reduce the number of manufacturing locations from 93 to 48 by the same deadline.
The plan also includes closure of five R&D sites and relocation of some research projects. Pfizer was one of the first multinational pharmaceutical companies to establish a dedicated clinical research division in India. About two-thirds of this division’s portfolio relates to human studies executed on behalf of Pfizer global research and development.
Mint reported on 13 November that Indian units of Pfizer and GlaxoSmithKline Plc. could benefit from the decisions of the parent companies to shut down some manufacturing and research facilities in the US and Europe, and also cut jobs in some overseas locations on the back of lower sales and the failure of key products.
LaMattina said though his firm does not expect blockbusters such as Lipitor, which gives Pfizer revenues of $13 billion a year, to come out of the current research stream, it still has around 240 new drugs in the pipeline, which is the biggest research pool among pharma firms. This includes about 80 new chemical entities and many more new uses and line extensions.