Pfizer, Cipla in Aurobindo redux plan

Drug maker Cipla could soon be supporting the strategies of global pharma giant Pfizer for expanding its footprint and protecting its business interests as many of its drugs go off patent.

The Mumbai-headquartered company is reportedly in talks with Pfizer for an arrangement to cater to the demand for the latter’s drugs in the emerging markets.

Cipla joint managing director Amar Lulla told NW18 the company was in talks with Pfizer to pursue “commercial matters”, including research and development, manufacture and supply of pharmaceutical products in India for the US multinational.

Lulla, however, denied an ‘alliance’ for Lipitor, the blockbuster cholestrol fighter drug. “We will be developing, manufacturing and supplying pharmaceutical products in India for Pfizer. There are no talks for any alliance or on (manufacturing of) Lipitor,” Lulla said.

Notably, Pfizer entered into a similar arrangement with Hyderabad-based Aurobindo Pharma in May this year. The deal also provided for Pfizer marketing about 55 products of Aurobindo in emerging markets. The products pertain to cardio-vascular and central nervous system disorders. Sources said Aurobindo is also likely to expand its arrangement and offer a significant portion of its manufacturing facilities for Pfizer’s needs.
The move is a part of Pfizer’s strategy to counter the effects of patent expiries and competition from generic drugs, say analysts.

Several of Pfizer’s drugs, including the blockbuster cholesterol drug Lipitor, are expected to go off patent in the next couple of years. These drugs currently contribute about 40% of the company’s revenue. In fact, the established drugs or generic drugs segment contributes about 15% of Pfizer’s revenues and that is under pressure due to the competition from generic drug makers from countries such as India.

The company’s three-pronged strategy includes partnering with companies like Aurobindo, in-licensing their products and manufacturing these products at Pfizer’s facilities; getting some of its products manufactured at cost-effective rates at FDA approved facilities in other countries; and acquiring companies with quality assets.
“Pfizer is getting ready for the off-patent regime. If it does not ally with players like Aurobindo or Cipla, it would be under pressure from the same players in the generic market. So, the company is actually putting in place a de-risking model,” a pharma industry source said.