February 1, 2011 (Vol. 31, No. 3)
Wyeth Acquisition Provides Impetus for Realignment of Worldwide Plant Network
About two years ago, Pfizer acquired Wyeth to create what it says is the world’s largest biopharmaceutical company offering products in a variety of therapeutic areas. Wyeth brought to the merger an early appreciation for biotechnology that led to biologics such as Enbrel for rheumatoid arthritis and Prevnar, a pneumococcal vaccine for infants.
With nearly $70 billion yearly in global revenues, the combined company markets products in 150 countries worldwide. Sixteen of its products are blockbusters, with more than $1 billion in annual sales, and 60 products bringing in more than $100 million. Pfizer’s products cover the life span, starting with vaccines and nutritional products for infants, to drugs for treating illnesses that strike later in life such as cardiovascular disease, Alzheimer disease, and cancer.
The acquisition of Wyeth’s biotechnology expertise expanded the biotherapeutic business at Pfizer. The biotherapeutic capabilities at Pfizer now include protein-expression technologies, expertise in biological product characterization, drug delivery technologies, clinical science and regulatory know-how, and biotechnology manufacturing and supply chain expertise. These skills benefit the company’s portfolio of biotechnology products and pipeline.
Pfizer Global Manufacturing (PGM) supports fast, flexible, and innovative biomanufacturing. PGM is also network driven and commercially focused. The combination of manufacturing efforts at Pfizer and Wyeth resulted in a reconfiguration of its worldwide plant network to create a fully aligned manufacturing and supply organization. This “transformation strategy” increases efficiency and lowers costs by more effectively using resources and technology, improving plant processes, eliminating excess capacity, and aligning production with market demand.
“The PGM biomanufacturing network strategy will lead to multiproduct and multipurpose biomanufacturing facilities,” says Lou Schmuckler, senior vice president of PGM’s specialty/biotechnology operating unit. Historically, biotechnology plants have been dedicated and manufactured a single product. When Pfizer acquired Wyeth, half the manufacturing facilities were dedicated.
“After we implement our new network strategy, none of our facilities will be dedicated. This is truly a transformational strategy that will leverage significant bioprocessing technology and innovation,” says Schmukler. The transition to multiproduct, multipurpose facilities in the next three to five years will increase the company’s flexibility and cost competitiveness. “We call this the re-blueprinting of biomanufacturing at Pfizer with science and biology overcoming stainless steel to optimize our network. In other words, we’re utilizing process development in place of capital investment.”
Pfizer’s biotechnology operating model rests on three main pillars—biotherapeutic research, biotherapeutic process development and supply, and marketing and sales of biotherapeutics. “The new operating model takes the best practices of Pfizer and Wyeth,” comments Schmuckler. Three organizations make up one of the pillars—the biotherapeutics process development and supply technical community. They are the 6,500 employees of the biotherapeutic pharmaceutical sciences, biomanufacturing sciences, and biotechnology manufacturing. They work as an integrated technical community with one over-arching vision, mission, and strategy.
The process development and supply community looked at the industry landscape and evaluated where it could add the most value. Process innovation, product innovation, cost, speed to market, and quality and reliability were identified as the key value drivers. To improve the pipeline for biotherapeutics, the manufacturing platform will be improved to increase titers, yields, throughput, and downstream purification. “We see the industry at an inflection point, or time of change, where old strategic paradigms will go by the wayside.” Process intensification at Pfizer aims to get more protein out of bioreactors and increase capture rates through better downstream processing.
A new area for Pfizer is its entry into biosimilars. An agreement with Biocon in India gives Pfizer marketing rights to biosimilar versions of recombinant insulin products being developed by Biocon. “There are special requirements to enter these markets, and Pfizer is well positioned to manufacture and commercialize biosimiliars.” Placing more importance on process development and supply will contain costs and make biosimilars more affordable.
Pfizer continues to build on its strength of having a strong track record in working with government regulators globally to bring products to market. “We have considerable expertise in this area and will work with regulatory agencies to bring biosimilars to market,” Schmuckler says.
Pfizer is looking for opportunities in emerging markets, including Brazil, Russia, India, Turkey, China, and the Middle East. Not only do people who live in these rapidly growing markets need biotherapeutics, but also significant research and development efforts are occurring there. Access and affordability are key to entering these markets and developing biomanufacturing opportunities.
China, for instance, requires companies who want to sell pharmaceutical and biotechnology products to its citizens to also manufacture the products in China. “That has to be factored into a company’s strategy,” comments Schmuckler. In Russia, policy dictates that half of all pharmaceuticals sold will eventually need to be manufactured there as well. “We’re looking closely at how the environment is evolving from a development and manufacturing standpoint.”
Biopharmaceuticals are becoming a larger part of the global pharmaceutical business, and vaccines are the fastest growing segment, according to Schmuckler. A big contributor is Prevnar, and Pfizer is gearing up to supply even more of the vaccine to emerging markets through a partnership with UNICEF. However, monoclonal antibodies and recombinant proteins still dominate the biotherapeutics market.
Overall, the integration of Wyeth’s biotechnology assets has gone well. The new Pfizer biotherapeutics organization is well positioned to be successful in the future, according to Schmuckler.