Pfizer-Wyeth Merger a Preview of Things to Come?

Pfizer’s recent move to buy Wyeth should not have come as any major surprise.  With patents expiring in the near future, and revenue pools drying up, such a move made sense.  But according to Pharmafocus, more pharmaceutical mergers may be on the horizon.

One such company that is speculated to make a move is Merck, which still hasn’t found a product that equals the amount of revenue generated by Vioxx.  In 2004, Vioxx was withdrawn after concerns that the drug increased the risk of heart attacks.  Chief executive Richard Clark recently said, “I don’t think in today’s world any CEO can categorically rule out any type of transaction.”  Some speculate that Merck could potentially merge with Schering-Plough, after the two forged a successful partnership for the marketing of cholesterol drug, Vytorin.

Another potential merger could involve Sanofi and Bristol-Myers Squibb.  The two recently gained legal protection against any further attacks on their co-marketed drug, Plavix.  But with the patent for Plavix expiring in 2011, both will see a huge loss in earnings.

At the same time, GlaxoSmithKline has made it clear that they are not interested in any mega-merger.  Chief executive Andrew Witty recently said he would “not be distracted by large-scale M&A.”  Some believe that the company’s recent moves into emerging markets supports Witty’s statement.

While merging companies may cut costs, it may only buy time.  The real cure for big pharma is to continue innovating and diversifying their research.