Wyeth 'no miracle drug' for Pfizer

published 30 January 2009

"Pfizer knows a thing or two" about treating ailments, said Rob Cox on Breakingviews. And its $68bn takeover of Wyeth (NYSE:WYE), making it the world's number-one drug-maker by sales, "looks like decent therapy". Pfizer (NYSE:PFE) gets a short-term fix, adding consumer products, biotech and vaccines to its pipeline. It should give earnings an immediate boost and there are $3bn of costs to be taken out, said Alex Brummer in the Daily Mail. Pfizer is expected to fire 15% of the combined workforce around 19,000 employees and close five factories.

Many question how the $75bn firm would find new drugs and vaccines to generate growth, said Jonathan Rockoff in The Wall Street Journal. This isn't a case of "two drowning men grabbing on to each other," said Lex in the FT. "But Wyeth is no miracle drug." Pfizer chief Jeff Kindler has acknowledged he is eyeing up other potential takeover targets, with analysts suspecting biotech group Amgen tops the list. Faced with the threat of generic drugs and recession, other drug groups will also prop each other up. "This looks like a taste of deals to come," said Cox.