Pfizer continues realigning with 3 new units

TRENTON — Pfizer Inc., continuing its drive to create more focused business units, told employees worldwide Tuesday it is replacing its current geographic divisions with new ones centered on primary care, specialty care and operations in emerging markets.

The shift is aimed at enabling the world's biggest drugmaker to respond better to the needs of doctors, patients and government and other payers, while increasing innovation and holding the independent business units accountable for meeting targets, Pfizer spokesman Ray Kerins said.

The new units, which will begin operating at the beginning of next year, will have complete responsibility for functions including strategic planning, sales and marketing, and even drug development — testing experimental compounds in people and tinkering with them to come up with the best dose.

Research operations, including identifying potential compounds and testing in the laboratory and in animals, will remain independent, according to Kerins.

"We believe this is where the company can best unlock the value for our customers," he said.

Some employees may see slight shifts in their duties, but job cuts are not part of the plan, he said. Under a major restructuring announced in January 2007, the company already has eliminated more than 13,500 jobs, closed numerous plants and reduced annual costs, compared with 2006 levels, by $1.2 billion out of its goal of cutting $2 billion in spending. Those cuts are being made ahead of expected generic competition in late 2011 for blockbuster cholesterol fighter Lipitor, which generates more than $12 billion a year — one-quarter of Pfizer's revenue.

The letter tells employees there's no guarantee there won't be future job cuts, but that the current evolution is meant to give the company a flexible cost base and make it more responsive to new opportunities and the public's needs, according to Kerins.

Like many global corporations, New York-based Pfizer has operated business units organized by geography, with divisions and executives in charge of sales in the United States, Europe and other regions.

Under the new plan, announced in a letter from the company's top executives, sales and other functions will now be handled globally, with the exception of the new unit devoted to emerging markets. Those are countries with large populations that are now spending more on health care — China, India, Russia and Brazil and others — that most drugmakers now are targeting more aggressively.

The primary care unit will have salespeople focusing on family doctors and products such as Pfizer's Lipitor and impotence pill Viagra.

Meanwhile, the specialty care unit will market drugs such as Pfizer's HIV medicine Selzentry and will seek feedback from doctors, patients, advocacy groups and others concerned about particular diseases where better treatments are needed.

The new units are part of a shift that began in 2007, when then-new CEO Jeffrey Kindler rolled out the concept, called "Our Path Forward," and Pfizer began creating specialized units. Those now include units devoted to animal health, established products that have lost patent protection but still sell well globally and an oncology unit.

Those three units and the three new ones will each be run by a general manager with responsibilities like those of a chief operating officer.

Some of the new units are headed by new executives lured from Pfizer competitors. Meanwhile, some of those competitors have made similar realignments to improve their bottom lines in recent years. GlaxoSmithKline, Johnson & Johnson, Merck & Co. and Bristol-Myers Squibb Co. have all started more flexible, focused units to some extent.

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