Updated from 6:20 p.m. EDT

Hank McKinnell, the Pfizer ( PFE) chief executive who has irked investors by failing to lift the drugmaker's share price in five and a half years at the helm, will be ceding the top corporate post and retiring sooner than planned.

The world's biggest pharmaceutical maker said Friday that Vice Chairman Jeffrey Kindler will take the CEO post from McKinnell, who will remain chairman until February. Kindler, a 51-year-old who also serves as Pfizer's general counsel, joined the company in 2002 from McDonald's ( MCD).

"The board and I see the pharmaceutical industry changing rapidly," McKinnell said in a statement. "Pfizer is changing as well and aggressively transforming its business model to build the next-generation Pfizer. With these initiatives well underway, it is time to transition to new leadership to accelerate the company's transformation."

McKinnell became CEO in January 2001. Pfizer's stock closed the first trading day of that year at $41.19, and Friday it ended at $26.11, a decline of roughly 37%. However, the shares are up 14% from where they finished 2005.

"Hank McKinnell has led Pfizer through some of its more challenging times," Lead Director Stanley Ikenberry said in a press release. "He was instrumental in taking the company from 14th to first in the global pharmaceutical industry, integrating both Warner-Lambert and Pharmacia into Pfizer and bringing a wide range of new medicines to market."

Previously, McKinnell had intended to retire early in 2008. Karen Katen, a vice chairman and the president of Pfizer's human health group, and David Shedlarz, another vice chairman, were seen as the other two possible replacements for McKinnell. Katen joined Pfizer in 1974, and Shedlarz went to the New York-based drugmaker in 1976.

McKinnell has been with Pfizer for 35 years, and he said now is the time "to pursue other business and philanthropic interests."

As for Kindler, before working at McDonald's, he was vice president and senior counsel for litigation and legal policy at General Electric ( GE). He was formerly a partner at the Washington law firm of Williams & Connolly.

Kindler said that under his watch "we will transform virtually every aspect of how we do business, focusing on actions that create and sustain value for our shareholders." He also said the company will "pursue a broader portfolio of opportunities, including biologics, oncology medicines, potential new treatments for Alzheimer's disease and even vaccines."

Indeed, the management change comes at a time when Pfizer is in the process of remaking itself. Last month, the company reached a deal to sell its consumer products business to Johnson & Johnson ( JNJ) in a $16.6 billion transaction, from which Pfizer expects proceeds of around $13.5 billion.

With the sale and expected cash flow from operations over the next two and a half years, Pfizer should be in control of about $34 billion after capital expenditures and dividends.

Last week, when it reported quarterly earnings, Pfizer said it would spend $17 billion to buy select technologies and products, while setting aside a similar amount for stock repurchases.

At the same time, the company lifted its full-year financial guidance. The focal point of Pfizer remains Lipitor, the best-selling prescription medication on the planet. This year, Pfizer is looking for product revenue of about $13 billion from the cholesterol fighter.

Still, some Wall Street analysts say the company needs more new products to make up for brand-name drugs that have already or will be losing patent protection in the coming years.