Let’s see. What can we say about Dick and Jeff?
Well, they’re both baby-boomers—Dick entered the world in ‘46, and Jeff delighted his parents five years later. Dick became CEO of Merck in 2005, and Jeff took over Pfizer just shortly after that. Dick was a Merck Lifer who had spent most of his career in the backshop, overseeing labs. Jeff was the outsider, a lawyer who was recruited to Pfizer from his previous job, running the Boston Chicken chain of fast-food restaurants. Most of what they shared in common, as Big Pharma leaders, was their job title, jumbo compensation packages, and mandate to get out there and charm the investment community.
Dick went on television, in a series of prime-time advertisements spreading the word that his company “put patients first.” His credibility with tube-watchers wasn’t helped by his having the same name as the host of the well-known quiz-show, The $100,000 Pyramid—or his physical similarities with another contemporary Dick: Vice-President Cheney.
Jeff, on the other hand, preferred to work the room in person, criss-crossing the planet with tales of his plans to dramatically “re-invent” Pfizer, and, thus, the pharma sector. He had his own credibility issues, having arrived in the drugbiz from a background of “We have to charge an extra 50 cents if you want white meat.”
Both quickly fell back into the predictable behavior patterns that characterized their predecessors: getting rid of workers and facilities, spending fortunes on hit-or-miss licensing deals, talking up pipeline prospects that the FDA would never dream of approving, and, ultimately, taking out a smaller competitor, after nothing else seemed to work.
But, make no mistake, when the clock ran out, they couldn’t get ‘r done: that is, the main job, which is to maximize shareholder value.
When Dick joined Merck, its stock was badly beaten up, down to 22 bucks. By the end of 2007, he’d convinced Wall Street it was worth nearly 52 smackers, and he was known around the office as Good Old Dickie, the Miracle Man. Just 14 months later, it was back down to 22 bucks, and Merck’s institutional investors resumed frostily calling him Richard, or Mr. Clark. Institutional investors strongly prefer predictable revenue streams and steady earnings growth. Volatility is alright for some—Turkish football fans, for example—but is not at all welcome in the white-shoe brokerage houses. (Merck shares are for the moment bouncing around the mid-30s.)
When Jeff joined Pfizer, its shares were stuck around 20, and Wall Street was muttering libels concerning the name of Henry McKinnell, the Canadian-born ex-kingpin who led the company’s stock down from it’s $33 zenith. Jeff coaxed it back to 22, at which point things quickly turned brutal. At bottom, Pfizer struck eleven-and-a-half, which is barely the price of a quarter-chicken Value Meal, with two sides and a large root beer. It’s now bouncing between 16 and 17, not at all what analysts had demanded five years prior.
We know it wasn’t your fault, fellas. None of us here at the “Couldn’t Get ‘r Done’ Club” would have done anything differently. I suppose that’s stating the obvious. You boys did what all of us former CEOs done—I mean, did. You inherited cumbersome, overly-complicated, impossible-to-manage organizations, and, responding to a challenging environment, added layers of complexity, unwieldiness, and convoluted processes. You tried to shift the paradigm, but the darned paradigm kept shifting back, like it was some kind of crazy punching-bag paradigm.
If our businesses’ value proposition at first seemed difficult to convey to payers and formularies, we’d just hire 12 new Vice-Presidents of Obfuscation to go shovel the bafflegab.
When the regulatory and economic climate in our largest markets looked bleak, we’d rush to do snap deals in untested jurisdictions. (Indonesians have hyperlipidemia and social anxiety disorder too, right? And probably Sri Lankans, if that’s what they’re called.)
When we knew we had tens of billions of dollars worth of patents about to expire, we responded by mumbling vague observations about new blockbusters, personal genomes, and that brand new, shiny thing, the Interwebs.
We were hamstrung by our grandiose circumstances: la gloire, the million-a-month in compensation, drivers with history degrees from good colleges letting the engine run, the sycophancy of the board acolytes, the mind-set that proclaims, a la Citigroup and General Motors, that we are too big to fail.
It turns out, as it always does, that we’re also too big to fully succeed, or to do much of anything, for that matter. So we just pass the muffins around the boardroom, considering the merits of blueberry, vis a vis the banana-walnut combination, and we stall for time.
Time’s up now, and Ken Frazier and Ian Read have assumed the crucial leadership responsibilities once engaged in by Dick and Jeff, and all us former Big Pharma CEOs before them. It’s Ken and Ian’s turn to leap the hurdles, and try to bring new products to market to improve the lives of sick people. Their turn to inspire and motivate the workforce. To try and make sense of the emerging picture. To return the call from the overseas industry minister: Hello, Yuri; how are things out there in Uzbekistan? Give the deposition to the assistant district attorney. Get a quick haircut before the CNBC interview.
Keep the lid on. Make the numbers. Dodge the bullets. Tread the water. Toss raw meat at the snarling dogs. Play the clock. Talk about urgency, urgently, while you buy time.
But now it sounds as if Mr. Kindler wants to tell us something. What’s that, Jeff? You say you want to… recharge your batteries? Ha, that’s certainly a new way to put it, that’s for sure. Never heard that one before.