Pfizer Gropes for Answers

Right after Pfizer (PFE) ended the development of what was its most important experimental drug, Chief Executive Jeffrey Kindler said he would accelerate his plans for transforming the company.

On Wall Street, inquiring minds weren't quite sure what that would mean. Will Pfizer fire more people? Will it buy more products, or maybe acquire more companies?

Kindler has promised that he will reveal details of his vision in January. Based on his recent announcement that 20% of the 11,000-member U.S. sales force will be fired by year-end, it's apparent that more payroll reductions and cost-cutting are probably going to be part of Pfizer's strategy.

However, Kindler must add sources of sales and profit, and he has several options, even if what's ultimately chosen isn't immediately known.

What is certain is that Pfizer has decided to stop work on torcetrapib, a drug designed to raise levels of so-called good cholesterol in order to improve cardiac health. Pfizer cancelled the project on Saturday after an early look at a clinical trial showed a higher death rate for patients taking a combination pill of torcetrapib and Lipitor than those on Lipitor alone.

Lacking specific guidance, analysts let their imaginations wander, with speculation ranging from massive firings to Pfizer acquiring a big biotech company or even one of its Big Pharma brethren.

Megamergers, a staple of Pfizer's past, isn't exactly what Kindler had in mind when he told analysts recently that he would look at "strategic" acquisitions. Company executives talked about modest-sized deals in which Pfizer would be a buyer, licensee or collaborator on products or technologies, if not an acquirer of other health care firms.