Pfizer to exit UK R&D site and outsource more to cut costs

By Gareth Macdonald contact

- Last updated on GMT

Related tags: Pfizer

Pfizer to exit UK R&D site and outsource more to cut costs
US drug giant Pfizer will close an R&D centre in the UK with the loss of 2,400 jobs to help save $5bn a year by 2012.

Operations at the site in Sandwich, Kent, which is a hub for anti-allergy and respiratory drug development and where the blockbuster erectile dysfunction pill Viagra was discovered, will be wound down over the next 18 to 24 months.

The closure is part of Pfizer’s post Wyeth takeover efforts​ to refocus R&D operations in response to difficult market conditions according to company spokesman Andrew Widger.

He told in-Pharmatechnologist.com that: “Like all of our industry peers, Pfizer is challenged with insufficient productivity and an unsustainable model for innovation,” ​adding that the changes​ are designed to address the problem.

We will concentrate our efforts where we can deliver the greatest medical and commercial impact,”​ Widger continued, highlighting neuroscience, CV disease, cancer, immunology and vaccines as key research areas.

He also said pain and sensory disorders would be a focus for Pfizer, adding that much of this work will be conducted at the new dedicated unit the firm is setting up in Cambridge in the UK.

US R&D cuts

The Kent closure was announced in Pfizer’s 2010 results presentation on Monday along with a plan to “shift of selected resources from Groton, Connecticut to Cambridge, Massachusetts.”

Pfizer subsequently confirmed its US plan, telling the Norwich Bulletin​ and Boston.com​ websites it will cut 1,125 R&D jobs in Gorton and neighbouring New London and shift some positions to Massachusetts.

This was followed, in a Reuters​ report, by the news that while Groton will remain Pfizer's biggest US research site, it will no longer play a role in discovery and instead will focus on toxicology studies and other laboratory analysis work.

Outsourcing

The other part of Pfizer’s plan to boost R&D efficiency and productivity is to make greater use of contract development and manufacturing organisations as Widger went on to explain.

We intend to create novel and flexible partnerships to externalize R&D services that do not drive competitive advantage for Pfizer. Discussions around these partnerships are underway.”

This approach is in keeping with moves by peers like GlaxoSmithKline (GSK), Sanofi Aventis and Eli Lilly, who have all formed “strategic partnerships” with contract research and manufacturing organisation in recent months.

Quite how the contract research sector will react to the world's biggest drugmaker's comments about outsourcing is unclear given that a number, most recently Parexel​, have started to speak about some of the negative aspects of strategic partnering.

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