Pfizer's Bad Example: CEO Jeff Kindler

It was with great interest that I read Kim Strassel's piece in Friday's Wall Street Journal concerning Pfizer's CEO, Jeff Kindler's bargain with the devil over health care legislation last year.

I've written in earlier posts concerning the auto company bailouts that both government and corporate executives have unwisely failed to observe a separation that ought to remain.

Specifically, corporations ought not seek government aid, and government ought not give it.

Yet, from reading Strassel's editorial, it appears that Kindler did exactly that by pandering to the administration's and Congress' coercive threats, to be embodied in last year's failed health care bill.

Strassel details how Kindler, upon arriving at Pfizer, suddenly oversaw the retirement of free-market oriented governmenat affairs personnel, and magically hired people with ties to various Democratic powers, current and out of office.

In a variant of requesting aid for his firm, Kindler caved in to Congress on opposing the socialization of medicine, in exchange for protection from threats like drug reimportation, guarantees of purchase of branded drugs by the government, and no price controls.

Then, as Strassel carefully notes, Congress reversed itself as the going got tough. Now, reimportation is back on the table, as are Medicare drug price controls and new limits on certain pharma patents.

This just goes to show how dangerous it is for the private sector to succumb to Congressional coercion and, worse, try to jump into bed with that branch in order to trade favors.

It's always far better for industry to aggressively defend and express its own views contrary to government's. The risk to business is that, having given in on some key aspects of a business model, the impression is that the firm was either lying in the past about its business processes, or didn't really need some practice it vociferously defended.

Now, thanks largely to Kindler, Big Pharma is left looking like they agreed with Congress on many issues which are, in fact, key to their current business models.

Perhaps Pfizer's board should have been more careful in choosing its new CEO and so radically changing its pro-free market orientation.