Pfizer's UK Sandwich Has Wrong Kind of Filling

Pfizer's decision to close down its UK-based R&D site in Sandwich, Kent, is one the government could have done without. It means 2,400 fewer jobs in the UK, hits tax revenues and comes at a time when the politicians in power are still reeling from worse-than-expected economic figures for the country from the fourth quarter of 2010.

Pfizer says the move isn't a reflection of its views on the UK as a location for pharmaceutical research. Instead it's part of a broader, global cost-cutting plan that's been going on for a couple of years; Groton, Connecticut was hit in the latest slashings too (25% of the 4,500-strong workforce there is going).

The problem is that the Sandwich site at Kent is focused on areas that Pfizer's pulling out of: allergy/respiratory, internal medicine, urology, virology etc. Viagra's hey-day is over (at least for the manufacturer), leaving Sandwich with...well, the wrong kind of filling.

That said, some of the choiciest parts of the filling, notably pain research, will be moved to the drug giant's Cambridge, UK site, but we're not talking big numbers; R&D president Mikael Dolsten instead used the vocabulary long familiar to many of his colleagues, that of the biotech-like unit. "We're creating more of a biotech pain unit" in Cambridge, he said.

There's no doubt that this is still a snub to the UK (and Groton). CEO Ian Read outlined in the company's Feb. 1 results announcement key steps in the increasing-innovation-and-productivity process to include "a realigned global R&D footprint to increase our presence in key biomedical innovation hubs."


So we didn't need Read to tell us that Kent isn't a key biomedical innovation hub. Still, the closure -- which will occur over the next 18-24 months -- has triggered a flurry of activity among politicians to try to carve out a plan as to how to maintain R&D activities at the site. No doubt they're thinking of star-child GlaxoSmithKline (a UK-headquartered firm, incidentally), which is putting about £11 million, or a third of total funding, into a new bioscience innovation park near its current site in Stevenage, north of London, and which in November 2010 announced its plan to invest £500 million in local R&D and production, including adding manufacturing capacity at its Hertfordshire site for respiratory disease.

UK governments moves to try to attract and retain R&D-focused companies to Britain include a "patent box" offering lower tax on income generated from IP discovered in the UK, an innovation investment fund to help fill the empty VC coffers and thereby kick-start investment in biotech, and ongoing attempts to try to make conducting clinical trials easier, cheaper and less bureaucratic.

None of these are going to influence where the Pfizer behemoth does or doesn't choose to have a footprint. Meanwhile, moves to curb drug prices -- including the UK's plan to introduce value-based pricing, essentially putting an end to free (ish) upfront pricing -- aren't exactly compelling reasons to stick around in a market which, after all, is only worth about 3% of the total.

Update: 3pm (UK time): Alternative Fillings for the Pfizer Sandwich
Pfizer's biotherapeutics chief JC Gutierrez-Ramos told The In Vivo Blog this afternoon that "there's a lot of work ongoing to explore alternative parterships at the Sandwich facility," and that nothing's off-bounds. Multiple ideas, multiple discussions with partners of all types....CROs, investors, companies and academia. "Hopefully we'll see some results" of those discussions over the coming months, says JC.

Meanwhile, he's busy rolling out the company's ambitious plan to create biomedical research engines (or Centers for Therapeutic Innovation) in a handful of cities across the globe...which will one day include London, but, we understand, not Sandwich.