Pfizer-Wyeth merger to close today

Posted: October 15, 2009

Pfizer Inc. and Wyeth plan to close their $68 billion merger today, leaving employees at the companies' two Philadelphia-area sites wondering whether they'll be among the 20,000 to be laid off.

The two companies employ about 130,000 people and have said that there will be layoffs.

U.S. and Canadian antitrust regulators cleared the merger yesterday.

Wyeth, based in Madison, N.J., employs about 4,500 people in this area - about 3,600 in Collegeville and 900 in Great Valley and other sites.

State legislators and Gov. Rendell's office have been meeting with Wyeth and Pfizer executives to sell them on the idea of keeping a large Pennsylvania presence.

"I'm sure that we will very soon find out the implications for our region," State Sen. Andy Dinniman, a Democrat who represents parts of Chester and Montgomery Counties and has been involved in the discussions, said yesterday.

Pfizer, of New York, is facing patent expirations on billions of dollars' worth of drugs in the next few years, including its best-selling Lipitor, and it must cut costs to compensate for those revenue reductions.

Deutsche Bank AG analyst Barbara Ryan said yesterday that she expected Pfizer to announce significant cuts to the combined company's research and development budget in the fourth quarter of this year.

In a separate note to investors last week, Ryan said: "We expect the combined R&D budget of the new Pfizer to be cut to $8-to-$9 billion, versus a likely spend of $10.6 billion in 2009. This difference could add up to $0.22 per share to [earnings] by 2012."

The regulatory approvals were announced yesterday and included the expected requirements that Pfizer sell about half of Wyeth's animal-health business and change a Canadian distribution agreement. Pfizer also said it would sell its horse-vaccine business.

German drugmaker Boehringer Ingelheim GmbH will buy those divisions, including Wyeth's vaccines and medicines for cattle, dogs, cats, and horses.

Contact staff writer Miriam Hill at 215-854-5520 or hillmb@phillynews.com.

This article contains information from the Associated Press.

comments powered by Disqus
|
|
|
|
|