Pfizer plots a big move (but it's not going very far)
Yes, Pfizer is moving. But not to Ireland or the UK, as it once hoped. And this has nothing to do with its tax bill.
Pfizer has notified staffers at its world headquarters in Manhattan that it wants more up-to-date digs befitting a colossus of the global pharma industry, though it didn’t use those exact words. So it’s selling its midtown skyscraper on East 42nd and Second Avenue and looking for something a bit more modern.
This wasn’t exactly the big move some had expected, or hoped for.
Over the last few years Pfizer has thought about splitting up the corporation, but CEO Ian Read let it be known recently that that prospect — and all the big banking fees associated with it — are now off the table. And Read tried mightily to accomplish the next big megamerger, first with AstraZeneca $AZN and then with Allergan $AGN, in search of a more advantageous tax address.
No, and no.
AstraZeneca saw Pfizer and Read off after a bruising “no” campaign that included some promises they’ve started to walk back. Allergan liked the idea for awhile, but the Obama administration changed the tax rules and Read had to back out.
What Pfizer has done is buy some things, most notably Medivation, for a jaw-dropping $14 billion. That delivered Xtandi and the PARP inhibitor talazoparib, which has attracted lots of positive attention. And there’s a big alliance in place with Merck KGaA on another PD-L1 checkpoint inhibitor. Pfizer hasn’t impressed anyone on the R&D side of the business since an accelerated approval for palbociclib (Ibrance) in early 2015. But that might change fairly soon.
That leaves Pfizer, which always planned to keep its big outpost in Manhattan, looking for a “modern facility designed to foster greater collaboration and innovation,” says a spokesperson. “We anticipate that it will take until the end of 2017 to sell our existing buildings on East 42nd Street and identify a new space. And we anticipate that colleagues will begin moving to a new Manhattan location no sooner than the first half of 2019.”
Pfizer currently occupies a million square feet at its less-than-modern, 33-story tower. We’ll wait to find out what Pfizer thinks qualifies as space suitable for “collaboration and innovation.” That might mean a lot fewer walls and a lot more open space, which tends to get mixed reviews from the staff and an enthusiastic thumbs up from the executive team.