After scrutiny from The White House, Pfizer Inc. PFE announced new plans to split its existing two business units into three, further separating its consumer health care business.
What Happened
On Monday, President Donald Trump attacked the pharmaceutical giant on drug pricing, tweeting that Pfizer and others should be "ashamed."
After Trump’s conversation with both U.S. Department of Health and Human Services Secretary Alex Azar and Pfizer CEO Ian Read, Pfizer reported that “prices would be deferred to levels seen 10 days ago as soon as technically possible, and the prices will remain in effect until the earlier of when the president’s blueprint goes into effect or the end of the year — whichever is sooner.”
The idea was "to give the president an opportunity to work on his blueprint to strengthen the health care system and provide more access for patients," according to Pfizer.
Soon after this, the pharma company announced new business plans.
Why It’s Important
Pfizer is now slated for separation into three units: Innovative Medicines, Established Medicines and Consumer Healthcare.
"This design gives us a sharper focus on diverse patients in diverse markets," Chief Operating Officer Albert Bourla said in a statement.
CEO Ian Read said in a statement that Pfizer expects a "higher and more sustained" revenue growth profile after 2020, and the new corporate structure will better position the individual businesses to achieve their potential.
What’s Next
The separation of business units is effective at the beginning of fiscal 2019, according to Pfizer. The company's stock was trading down 0.43 percent at $37.27 at time of publication.
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