Sector News

Ian Read may say goodbye to Pfizer, but he’ll join the board at spinoff Viatris

December 18, 2019
Life sciences

With Pfizer’s Upjohn and Mylan’s marriage up for regulatory review, both drugmakers are working out the details on who’ll be tasked with leading the new generics giant. Turns out, one of the executives most responsible for securing the deal will now stay on to steer his newest creation.

Ian Read, Pfizer’s executive chairman and former CEO, has been tapped as a board member for Viatris, the still-in-the-works Upjohn and Mylan merger. Also joining as a director is James Kilts, a former CEO of Gillette and VP at Proctor and Gamble.

Read and Kilts will work alongside Mylan chairman Robert Coury, who’ll retain that role at the new generics giant, and Upjohn chief Michael Goettler, who’ll stay on as Viatris CEO and board member. A third Pfizer-designated board member has yet to be announced, the company said.

Read, a 41-year Pfizer veteran, is expected to step away from the company Dec. 31 as part of a transition of power to CEO Albert Bourla, who took the reins from Read in January 2019. Kilts, a current Pfizer board member, will step down from that seat to take the Viatris role, Pfizer said.

“I’m delighted that Ian and Jim will serve on the Viatris board,” Coury said in a statement. “I’ve known Ian for some time, and his overall experience and knowledge of the Upjohn portfolio will serve Viatris well given the purpose and direction of the new company.”

Last month, Read announced he would step down from his chairmanship at Pfizer one year after relinquishing his role as CEO.

In 2010, Read took on the top job after former chief Jeff Kindler’s sudden departure in December of that year and in the midst of integrating the $68 billion buyout of Wyeth from the year before. After taking the reins, Read kicked off a slice-and-dice strategy that included the immediate selloff of its Capsugel unit for $2.38 billion, the sale of the drugmaker’s infant health business to Nestlé for $11.85 billion in 2012 and the spinoff of its animal health business Zoetis in 2013.

During that time, Pfizer wallowed in several blockbuster patent losses, including Lipitor and Viagra early on and late the loss of exclusivity of Lyrica in 2019. Those losses reflected directly on Pfizer’s income statement: In 2010, revenues were $62 billion and sank to $50 billion in 2015.

However, after Lyrica’s patent loss this year, the drugmaker is set to enjoy a prolonged period of exclusivity on its newer meds that’s expected to last until 2026, Pfizer said.

In Viatris, Pfizer has an opportunity to offload an Upjohn business that has lagged behind the drugmaker as a whole with only 1% growth in the first quarter of 2019 compared with Pfizer’s overall 7%. In the meantime, Viatris would become the single largest generics maker in the world when the deal closes in mid-2020.

The combined company is expected to rake in between $19 million and $20 billion annually and will encompass 51 manufacturing sites, including 25 solid dose, seven injectable, eight complex dosage forms and 11 API sites, Pfizer said.

The Upjohn unit houses all Pfizer oral solid generics and off-patent branded medications, including some top-sellers such as erectile dysfunction drug Viagra and cholesterol controller Lipitor. Biosimilars and the legacy Hospira sterile injectables are not part of the deal because Pfizer grouped those products into the biopharma unit—not Upjohn—during its July 2018 reorganization.

By Kyle Blankenship

Source: Fierce Pharma

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