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Pfizer to spin off animal health unit as Zoetis

Registers to make the unit a standalone company in US

Pfizer has announced plans to set up its animal health division as a standalone company which it will name Zoetis. 

The US pharma firm will file for a potential initial public offering (IPO) of a minority ownership stake in the new company, putting to rest rumours that the company planned sell off the unit in a similar fashion to the sale of its nutrition business to Nestle, with Novartis and Bayer touted as potential buyers.

The announcement comes a week after the departure of former head of Pfizer animal health Cavan Redmond to become CEO of online health information service WebMD.

At the moment, it is unclear what will happen to the rest of Pfizer animal health's 9,000 employees, spread across 120 countries, although Pfizer said Zoetis will "build on the leadership of Pfizer animal health", including the discovery, development, manufacture and marketing of animal vaccines, medicines, biopharmaceuticals, diagnostics and genetic tests for both livestock and pets.

“Pfizer Animal Health is a dynamic business with strong fundamentals, an expanding and loyal direct customer base and a proven management team,” said Ian Read, chairman and CEO at Pfizer.

“We are on track to create a standalone animal health company by our previously stated target of July 2013.”

The launch of Zoetis, the name of which is derived from 'zoetic' meaning 'pertaining to life', comes as Pfizer restructures its business to cope with patent expiries for big-selling drugs like Lipitor.

The company is looking to become a more streamlined business, focused on developing a strong pharmaceutical pipeline and maximising value for shareholders through suitable divestments.

“Our focus continues to be on taking the actions that will generate the greatest after-tax value for our shareholders,” said CEO Read, “with share repurchases remaining the case to beat in allocating cash proceeds from the separation.” 

8th June 2012

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