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DrugAir: Why Pfizer Execs Are Addicted to Their Fleet of 9 Private Aircraft

Pfizer (PFE) is trying to sell a corporate jet as it heads into a period of lower revenues following the imminent patent expiration on its no. 1 product, the cholesterol drug Lipitor. Although Pfizer is heading into a period of austerity, don't believe that the jet sale is a sign of management belt-tightening: history -- and CEO Jeff Kindler's contract -- both show that Pfizer brass will be flying on BlingAir for a long time to come.

Pfizer lowered its revenue guidance for 2010 by $1 billion to $67 to $68 billion in its Q3 2010 earnings report, and expects revenues to sink as low as $65.2 million in 2012. (Pfizer pfollowers should expect further downward revisions of those numbers as time goes by -- the company has made a habit of continually lowering its revenue expectations since acquiring Wyeth.)

One Pfizer jet, the 2003 Gulfstream G550 (Reg #N4CP) is officially up for sale. This is deja vu all over again: In June 2009 Pfizer attempted to sell two jets -- but then the Wyeth acquisition kicked in and no sale actually occurred. Rather, the opposite happened: Pfizer came into possession of Wyeth's jets (or its contracts for jet travel). Pfizer now controls a fleet of nine corporate airplanes aircraft*: two it owns directly and seven that it owns through Charlie Papa, a subsidiary.

The Gulfstream is a nice plane, as these images (click to enlarge) from the sale document show. Their amenities include:

  • Honeywell HD710 High Speed Data System with EMS CNX200 Router/Gateway
  • Six (6) Plug-In 5.6" LCD Monitors
  • Vision Safe EVAS
  • Magnastar C-2000 Radio Telephone
  • Airshow Genisis
  • Dual DVD
  • CD Player with FM/AM Stereo
  • 20" Forward Bulkhead Monitor
  • 15" Monitor Located Left Side Aft Cabin
  • Magnastar Phone System
  • Dual DVD Player
  • CD Player
  • Printer / HP Color Laser Wireless Networked
  • A TIA coffee maker and fridge
But if you take a look at Kindler's contract, the board of directors actually "requires" Kindler to fly everywhere on a private jet, even giving him 20 hours a year in personal travel (all he has to pay is the taxable value of that). Wyeth's management had the same "requirements."
Given Kindler's gold-plated travel requirements, the chances of Pfizer getting out of the airline business completely are slim.

*Correction: They're not all planes. Two of them are jets, one is a small plane, and the others are helicopters. Apologies for the error.

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