Pfizer Inc. Vice Chairman David Shedlarz Tuesday said the drugmaker was targeting acquisitions between $1 billion and $4 billion.
Pfizer, the world’s largest drug maker, is focusing its acquisition strategy on gaining intellectual property and therapeutic products across various stages of development, Shedlarz told the Cowen & Co. Healthcare Conference in Boston.
In a reference to Pfizer’s nearly $2 billion acquisition last year of Vicuron Pharmaceuticals Inc., which is focusing on developing anti-infectives, Shedlarz said, “Most of our M&A will be in that sweet spot.”
Such acquisitions would be relatively modest for Pfizer, which in the past six years has orchestrated massive takeovers of rival pharmaceutical companies Warner-Lambert and Pharmacia Corp.
Pfizer faces a challenging period as many of its top-selling medicines lose patent protection. The company last month forecast slightly lower 2006 earnings, but projected profit growth over the 2007-2008 period would be in the high single digits, helped by the launches of new drugs.
Shedlarz said Pfizer may have to consider giving up its historical preference for full control over its partners.
He said Pfizer could consider other types of alliances, such as Roche Holding AG’s relationship with Genentech Inc., which is the world’s second-largest biotech company. Genentech operates as an independent company, but it is majority-owned by Swiss drugmaker Roche.
“We’re going to have to be more open to those types of opportunities.” Shedlarz said, adding, however, that “our history is going to rub against that.”
Shedlarz said Pfizer aims to be a major force in biotechnology, fueled by partnerships such as one involving Serono SA’s multiple sclerosis drug Rebif. He said Pfizer ranks as the world’s eighth-largest biotech company with $1.5 billion in sales and aims to become the fourth-largest by 2010.
Shedlarz said he sees the pharmaceutical industry splitting between smaller specialty companies, and others that seek to grow even larger through mergers and acquisitions.
“You’re going to see some movement in the industry,” Shedlarz said.
Also at the Cowen conference, Pat Kelly, president of Pfizer’s U.S. pharmaceuticals division, said the new Medicare drug plans will benefit the company’s blockbuster Lipitor cholesterol treatment.
“We have every reason to believe that the movement into (Medicare drug plans) will be an economic boost to our underlying business,” Kelly said.