Ex-Pfizer R&D chief questions calls for wholesale pharma outsourcing

Big Pharma companies have been farming out more of their R&D in recent years to keep spending in check, yet the experts have clashed over how much outsourcing can be done without threatening the long-term vitality of a drug company. John LaMattina, the former Pfizer ($PFE) R&D chief and current senior partner at PureTech Ventures, punches some holes in an argument for the pharma giant to ditch R&D altogether in his latest blog post.

LaMattina, who retired from Pfizer in 2007, writes that internal research projects can yield new products the company owns outright, without having to share profits with a licensing partner or to pay big bucks to acquire new drugs in a buyout. Also, even companies that want to rely heavily on outside firms for new products need scientists, as LaMattina points out. Internal researchers can play an important role in the process of evaluating assets from external sources.

Still, industry watchers want drugmakers to cut R&D budgets for a reason. Internal R&D groups have been notoriously unproductive and expensive to maintain, prompting critics to question whether pharma giants like Pfizer should stick to selling drugs and let other groups discover and develop treatments.

To an extent, drugmakers have answered the call, handing pink slips to scientists and development workers in large numbers. Last month, Novartis ($NVS) announced that it would ax 2,000 jobs in the U.S. and Switzerland, impacting jobs in R&D and development. Sanofi ($SNY) has revealed plans to trim hundreds of R&D and sales workers from the U.S. payroll. Yet neither of those two giants nor Pfizer plans to abandon internal R&D efforts.

- get more in LaMattina's post

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