Pfizer Plans to Sell Hospital Drug Division, 35% of Chinese Market to Change Hands

On November 12, Reuters reported that US pharmaceutical giant Pfizer plans to sell its hospital drugs unit and is currently working with Goldman Sachs to evaluate it. The move means that the products, including antibiotics, steroids and immunoglobulins, will change owners, including the original drug Supraxen, which has a 35 percent market share in China.

Pfizer's hospital drugs unit is an asset it acquired after acquiring Hospira for $17 billion in 2015. Less than a decade later, however, Pfizer was willing to put it up for sale, and it is interesting why.

It is speculated that the pressure behind this decision may come from investment institutions. The Starboard Value fund made a strategic investment in Pfizer this year, and according to data from the Wall Street Journal, it now holds a $1 billion stake in the company, enough to influence Pfizer's management decisions. Starboard's chief financial officer has repeatedly called on Pfizer to optimize internal capital allocation, liquidate some of its assets and put more money into areas with more potential.

Pfizer's hospital pharmaceuticals division includes anti-infective drugs and sterile injections, including well-known antibiotics Supraxen, Sfortol and Zithromax, steroids Medrol and immunoglobulin product Panzyga, and is currently part of its specialty pharmaceuticals business. In 2023, the division contributed billions of dollars in revenue to Pfizer and maintained a 15% growth rate. However, from the perspective of the capital market, such a growth rate still seems to fall short of expectations.

Pfizer is widely expected to make further changes to its business segments in the future. Under the significant impact of the Starboard Value fund on Pfizer's strategic layout, Pfizer's core business may also face significant changes, which adds a considerable degree of uncertainty to the company's future development. On November 13, Pfizer's share price was slightly affected, falling nearly 3% at one point.