"When it comes to drugs, Europe is ‘free-riding’ and committing ‘blackmail.' Pfizer CEO Ian Read delivered remarks on health care and the pharmaceutical industry. He said he opposed any legislation that placed price controls on pharmaceutical drugs, calling it bad policy. He also outlined recommendations on how to improve America’s health care system. These recommendations included the need for more incentives in health care prevention and eliminating the approval backlog for generics.
Professional Profile: Ian Read, 59, has spent his entire career at Pfizer ($PFE), joining the company in 1978 as an auditor. He job-hopped and globe-trotted, first through Latin America and then to Europe and on to corporate headquarters. Before taking over as CEO at the end of 2010, he was a corporate SVP and president of the worldwide pharma businesses.
Total Compensation: $25.634 million
Compensation Breakdown: $1.74 million in salary, $3.4 million bonus, $6.44 million in stock, $6.5 million in options and $7.15 million in pension and deferred compensation, plus $409,892 worth of perks, car service, company aircraft privileges and other compensation.
Company Performance: Besides heading up the biggest drugmaker on the globe, Read has set the industry talking with his plans to streamline Pfizer. His back-to-pharma-basics strategy has won fans in the investment community, and analysts are hoping for more spinoffs and breakups, if not at Pfizer, then perhaps at Johnson & Johnson ($JNJ) or another diversified Big Pharma company.
Read announced his intent to spin off or sell two business units back in 2011, and last year, the plan started coming to fruition. Pfizer sold its nutrition unit to Nestle for $11.9 billion and laid the legal groundwork for the spinoff of its animal health division, Zoetis. That unit's bond sale and IPO, wrapped up early this year, beat all expectations.
Meanwhile, the company has been slimming down in another way: by cutting costs. The company's workforce shrank by more than 12,000 last year, and more layoffs were announced in December. An R&D restructuring also contributed to planned cost savings of $4.5 billion a year.
What's left? The company's designated core operations--its R&D-based pharma business, and its "value" businesses in off-patent drugs and consumer healthcare. It was a tough year, saleswise; generic competition for key products, including Pfizer's longtime best-seller Lipitor, took a $7-billion-plus bite out of revenue. Even the company's new childhood vaccine, Prevnar 13, acquired along with Wyeth in 2009, began to falter. But the company's emerging markets sales are growing, if not as quickly as it may have hoped. More importantly, 5 new drugs won regulatory approval before year's end, including the orphan drug Elelyso, for Gaucher disease; the rheumatoid arthritis fighter Xeljanz; and the anticoagulant Eliquis, widely pegged as a major blockbuster.