Pfizer Double-Dips

• Report this Comment On May 18, 2010, at 5:27 PM, ds10 wrote:

  Universities provide the scientists that pharma companies need in the future. This is a gesture by Pfizer to assist with tuition and to have an inside track in hiring. Both sides benefit.

• Report this Comment On May 18, 2010, at 10:13 PM, penywise wrote:

  When it comes to promoting the research, having the credibility of a top university like Washington university will carry a lot more weight than promoting pharmaceutical company funded research "hired guns" or even worse - internal (read = biased) research. It sounds like a good move to me.

• Report this Comment On May 18, 2010, at 10:28 PM, ETFsRule wrote:

  Standard. PhD students are good sources of cheap labor.

• Report this Comment On May 19, 2010, at 5:35 AM, geomed wrote:

  While there is certainly truth to these statements, the fact is that Pfizer today is a quite different company today, based on the many changes implemented by their CEO Jeff Kindler. Kindler, a lawyer, was formerly the General Counsel for Pfizer before his appointment. His limited experience in the big pharma/biotech world has been further complicated by his actions to impose massive layoffs, including many scientists. Not surprising, therefor, that they feel the need to gain some university research initiative. The highest PFE stock price has been since Kindler's appointment, was on the day he was announced to be the new CEO. Since that time the stock has continued to go downhill and it has been further warped by almost constant drug development failures. Time to make changes, or splitting up this company, may be the only way to go.

• Report this Comment On May 19, 2010, at 4:25 PM, Manhattan wrote:

  In the article “Pfizer Double-Dips” by Brian Orelli, featured in The Motley Fool® on May 18, 2010, the question is raised as to whether or not Pfizer could do certain research on its own instead of partnering with Washington University. The author posits as a reason, perhaps it is more cost effective to have Washington University to do the research, rather than doing the research in-house. Having set up cost as the “straw man” argument for partnering with Washington University, the author then proceeds to knock this basis down, by providing possible alternative partners that the reader is invited to assume could do the research on a similar basis.

  I don’t know why the author would assume cost-savings was the reason for the partnership. I did a quick search online and found a press release regarding the collaboration at http://media.pfizer.com/files/news/press_releases/2010/wu_co..., which appears to be the official statement from Pfizer, and nowhere in that document is there any reference to any cost-savings benefit. There is a claim for enhanced efficiency in drug development from the nature of this new collaboration, but that claim is based on a change in how this particular partnership will work compared to other academic partnering in the past – specifically the “sharing Pfizer’s [propriety] data on existing compounds, researchers will not have to replicate extensive preclinical studies, thereby shaving years off the time it takes to evaluate new uses for existing drugs.” That seems to indicate there is an expected time-savings benefit but it doesn’t claim that this benefit is the result of the Washington University collaboration in particular, merely a result of sharing the propriety data with research partners that is expected to yield time-savings in the drug development process.

  The article states as its reason for partnering with Washington University in this instance, is driven by its presumably successful “longstanding” relationship. There is also a claim that Washington University has “internationally renowned” expertise in a broad range of disease areas such as “Alzheimer’s, cancer, diabetes and related metabolic disorders, and asthma and chronic obstructive pulmonary disease.” Personally, I view vague claims of “renowned expertise” with skepticism. A statement like that is hard to evaluate, unless you are actually in those areas of research and then you might have a basis for agreeing or disagreeing. I am not. What I can evaluate is whether or not Washington University may have some advantage compared to other researchers in this field.

  A quick online search reveals that Washington University has six hundred and sixteen utility patents assigned to it, which could represent a significant intellectual property portfolio that other research options may not have the right to use. Of course, a bunch of those patents might not be related to medicine or the therapeutic areas of interest to Pfizer. Reviewing those patents a little further, there are seventy-five patents containing diabetes in the specification, twenty-one containing cancer in the specification, sixty-three containing Alzheimer’s in the specification, eight with asthma in the specification, and thirty with pulmonary in the specification. Consolidating the results, Washington University has two hundred and thirteen patents that at least mention one or more of the disease areas where the University is supposed to have renowned expertise. Those patents may be worthless, they may be invaluable. I’m not in a position to tell. It does seem like a basis for partnering with the University over other research options without access to those patents, especially if people who should be able to tell have done the appropriate due diligence – namely Pfizer patent attorneys and scientists.

  The questions I had when reading the press release was to what extent is the partnership exclusive? Will such a partnership affect whether the university would license its intellectual property to other drug companies? Will it affect the amount of research it does on drugs from other companies? By sharing the propriety data with the university, has Pfizer created barriers to the university freely partnering with other interests? Will such a close partnership potentially influence the academic independence of other research at the university, which isn’t directly funded or supported by Pfizer?

  I don’t know whether the partnership is good or bad for Pfizer, Washington University, or the public generally. But I don’t think cost savings were the primary driver.

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