Forbes: Analyst says Pfizer could divest units that bring $32B in revenue

Pfizer's ($PFE) new CEO Ian Read might want to trim certain business units to morph the drug giant into a pure pharmaceutical research company like Eli Lilly ($LLY), Forbes' Matthew Herper writes today, citing recent note from Bernstein Pharmaceuticals analyst Tim Anderson.

The analyst wrote that the strategy could mean transactions that would divest businesses that account for 40 percent or $32 billion of Pfizer's $67 billion in annual sales, according to Herper's piece. The trimming away of the company's non-pharmaceutical divisions as well as its business that sells off-patent drugs would enable it to focus on what Read characterizes as the firm's "innovative core" of high-value treatments, Bernstein's Anderson wrote after a recent meeting with Pfizer's new CEO. No firm commitments to turn this idea into reality have been made.

Pfizer is among major pharmaceutical firms that are searching for a way forward as big branded drugs are losing patent protections and facing competition from generic drugs. A leaner Pfizer could make it more nimble in this pursuit. Yet Herper's report cites a cautionary note from Anderson's analysis that says Pfizer--which has lagged behind its peers in developing new drugs--would have to improve on that score for the strategy to succeed. The strategy might also mean that Pfizer divests its Established Products unit or off-patent drugs business, which may bring the company revenue of about $17 billion in 2012.

- read Herper's post

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