Wednesday, June 6, 2007

CFO Exodus

The exodus of big pharma CFOs has received wide coverage in various blogs (Pharmagossip, WSJ, Pharmalot). While the reasons for the exit of CFOs at AZ, Merck and Amgen are ostensibly known, the departure of those at Wyeth and Pfizer is somewhat of a mystery.

Wyeth is really coming out of a rough patch and it would be an odd time for the CFO to leave (good news on the HRT/Diet Pill litigation front, approval of new molecules etc). If anyone has any theories on this one, please comment or e-mail.

Pfizer's CFO's departure too is somewhat of a mystery. One theory is that this is due to the shenanigans at Pfizer India (as reported by Dr. Peter Rost). Pharmalyst agrees with Dr Rost that it does appear that Pfizer India's top brass was involved in some sort of a kickback scheme (selling a plant for $3million which was subsequently valued by Indian tax authorities at $40 million is definitely suspicious). However looks like most of the wrong doing here rests with the people at Pfizer India. Unless the CFO (who if Pharmalyst's recollection is right was not the CFO when these events occurred) was directly responsible for overseeing the sale of plants in India, it is hard to see howthis could have precipitated in the CFO's departure.

Others have speculated that Pfizer's new CEO Jeffrey Kindler is looking for a CFO with more visibility and "Wall Street" experience. Pharmalyst believes that this is perhaps the more likely reason for their CFO's departure. One pure speculation on the part of Pharmalyst is whether the CFO was forced to resign because Pfizer lost the bidding war for MedImmune? Pharmalyst has no evidence of this but Pfizer brass have expressed an interest in acquisitions (esp biologics) and looks like there was another bidder at $51 for MedImmune (which was of course beaten by Astra's offer of $58 per share). Pharmalyst wonders if this had something to with the departure of Pfizer's CFO. Let me know what you think about this speculation on Pharmalyst's part.

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