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Pfizer pulls up stakes in NL

By Lee Howard

Publication: The Day

Published November 10. 2009 4:00AM   Updated November 10. 2009 5:31PM
Sean D. Elliot/The Day
The Pfizer Research and Development complex in New London will be closed by the pharmaceutical giant and its jobs consolidated in Groton. Sale or lease of the property, which encompasses more than three-quarters of a million square feet, could be a lengthy process. Though it comes as a blow to New London, the closure will not result in any major loss of jobs as a result of the Groton consolidation.
8-year-old, $300M campus to close; no job losses as operations will consolidate in Groton

Eight years after opening its state-of-the-art global research-and-development headquarters in New London, Pfizer Inc. announced Monday it will close the nearly $300 million complex within the next two years and consolidate local operations into its Groton campus.

The announcement that Pfizer will maintain its local work force numbers came as the company said it will be closing six research-and-development sites worldwide. About 1,400 positions in New London will be transferred to Groton, where about 3,500 people work, Pfizer said. When Pfizer first opened the New London campus, officials had said the complex could house up to 2,000 associates.

"In Groton and New London, there will be a minimal headcount effect," said Martin Mackay, president of Pfizer's PharmaTherapeutics Research and Development division, in a conference call. "Our presence in Connecticut will be approximately the same ... it's about 5,000 now, and that number will continue, though the makeup will change around the edges."

Pfizer earlier this year said nearly 20,000 jobs would be cut as a result of its merger with the New Jersey-based Wyeth. The company said Monday that about 15 percent of its overall R&D work force would be cut as part of that downsizing.

The announced closing of the New London site came as a blow to a city that had counted on Pfizer to help revive its fortunes. Instead, Pfizer's name became attached to a dispute over eminent domain that went all the way to the U.S. Supreme Court in a case that New London won on legal grounds even as it lost in the court of public opinion.

The loss of Pfizer as a keystone business in New London could put in further jeopardy the Fort Trumbull development that started in conjunction with Pfizer's move into the city but has left little but flattened buildings and eminent-domain angst in its wake.

Michael Joplin, president of the New London Development Corp., said Pfizer's withdrawal from the city will likely be a setback for a proposed hotel at Fort Trumbull. While the hotel would have attracted the general public as well as those visiting the proposed U.S. Coast Guard Museum at Fort Trumbull, Joplin said Pfizer had planned to make use of it as well.

"What we've lost here is an occupied property," Joplin said. "But it would have been worse yet if Pfizer had picked up its whole operation."

"All in all, I think we're lucky," said Tony Sheridan, president of the Chamber of Commerce of Eastern Connecticut. "The facility in New London was built with the best of intentions. If the industry can't support facilities in (both) New London and Groton ... hard decisions have to be made."

Keeping local jobs

Dennis Popp, mayor of the city of Groton, welcomed Pfizer's announcement, but said "that is bad news for the City of New London and business there, and maybe some of them will find their way over here."

"But it's just good news that people are keeping their jobs," he said.

U.S. Rep. Joe Courtney, D-2nd District, said Pfizer's global restructuring plan "strengthens Pfizer's viability as an entity here in Connecticut."

"My top priorities are to work with the company to keep jobs in Groton as part of the consolidated facility and to help find innovative ways to fill the New London facility with meaningful new jobs," Courtney said in a statement.

Mackay said the consolidation process could take up to two years, and he promised that "very active discussions" are under way to arrange a sale or lease of the 26-acre site in part or in whole.

Pfizer's New London complex has about 780,000 square feet of prime office space with views of the Thames River.

But, unlike the company's Groton research facilities that house laboratories for drug research and discovery, the New London site has no laboratory space needed to conduct the sophisticated research that will help the pharmaceutical company develop new drugs to replace an aging pipeline of remedies.

Sheridan said he expects any company looking to acquire the New London site would have to be a Fortune 500-level corporation, unless the office complex could be broken up into business condominiums.

"It's an extraordinarily attractive building," he said.

Mackay said consolidation of Pfizer's two local sites will mean upgrading facilities and creating new office space in Groton, a job made easier with the elimination of Pfizer's manufacturing plant, which was located across Eastern Point Road from the research campus, at the end of 2007.

"It's not going to happen overnight," Mackay said. "But Groton is certainly going to be a state-of-the-art facility."

As news of Pfizer's eventual exit from New London broke, employees approached at a smoking area outside the company's Pequot Avenue campus said they couldn't talk about the consolidation, in some cases waving away reporters before a question was even asked.

But two Pfizer contractors who were willing to talk said the future is uncertain.

"I don't know how it affects me," said Toula Buonocore, a clinical trial associate at Execupharm, a Pfizer contractor. "Maybe we'll get moved over to Groton. Anything can happen, so I'll just remain optimistic."

But Matt Dembkowski of Preston, who works for Eurest Services of New London, was worried. His firm, which has subcontracted with Pfizer for landscaping, custodial cleaning, and shipping and receiving, is about to be replaced by another service, he said.

"It means I'll probably be getting a layoff slip if I'm not picked up by the other contractor," Dembkowski said. "Being a landscaper, it's not a good time to get laid off."

R&D footprint to shrink

Pfizer's downsizings and closures will reduce the company's global square footage devoted to R&D by 35 percent.

Pfizer's stock price reacted positively to the news, finishing the day at $17.43, up 47 cents a share - or about 2.8 percent.

While Pfizer's overall job picture locally will not change dramatically, other R&D sites have been eliminated entirely or cut significantly as part of a consolidation related to the company's merger last month with Wyeth Pharmaceuticals.

Groton's R&D site will be among the five central hubs of Pfizer's newly revamped research operations. The other sites are in Cambridge, Mass.; Pearl River, N.Y.; La Jolla, Calif., and Sandwich, England.

Nine other sites will be set aside for specialized research. Among these are San Francisco, where monoclonal antibody discovery will be centered; Cambridge, England, where regenerative medicine work will be focused; and Shanghai, China, where other R&D activities will be ongoing.

"By focusing our R&D operations in these centers, we are building the world's premier biopharmaceutical R&D enterprise," said Mikael Dolsten, a former Wyeth executive who is now president of Pfizer's BioTherapeutics Research and Development.

New York-based Pfizer will be discontinuing former Wyeth operations in Princeton, N.J., Chazy, Rouses Point and Plattsburgh, N.Y., and at its North Carolina facilities in Sanford and Research Triangle Park. Other closings of former Wyeth sites will occur in the United Kingdom at Gosport and Slough/Taplow.

Pfizer also will significantly reduce R&D activities in St. Louis, whose Chesterfield Village campus will be sold to the Monsanto Co. for $435 million, and at former Wyeth facilities in Collegeville, Pa., and Pearl River, N.Y. Pfizer was not giving out figures for labor reductions in any of its individual announcements, but the St. Louis Post-Dispatch said the St. Louis site, which is a legacy Pfizer operation, will see 600 jobs cut out of a total work force of 1,000.

Groton will continue its research focus in neuroscience, antibacterials and metabolic diseases, Mackay said.

"The key message in Connecticut is this maintains a really important site for us," he added. "In fact, Groton will be our biggest R&D facility. It's a very important part of the network for us."

Day staff writers Patricia Daddona and Matthew Collette contributed to this report.

MORE

Pfizer: Where it's at

FORMER WYETH SITES STAYING OPEN:

• Collegeville, Pa.
• Pearl River, N.Y.
• Andover, Mass.
• Cambridge, Mass.
• Aberdeen, Scotland
• Montreal

PFIZER SITES STAYING OPEN:

• La Jolla, Calif.
• San Francisco
• Groton
• St. Louis, Mo.
• Sandwich, U.K.
• Shanghai, China
• Cambridge, U.K.
• Cambridge, Mass.
•Dusseldorf, Germany

SITES BEING CLOSED :

• New London
• Princeton, N.J.
• Chazy, N.Y.
• Plattsburgh/Rouses Point, N.Y.
• Gosport, U.K.
• Research Triangle Park, N.C.
• Sandford, N.C.

Source: Pfizer Inc.

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