Pfizer’s Battle with Starboard: A Test of Pharma Leadership in the Age of Activism

Pfizer Inc. (PFE) found itself at the center of one of 2024’s most high-profile corporate battles when activist investor Starboard Value LP launched a campaign to overhaul its leadership and strategy. The clash, which dominated headlines and shareholder meetings, exposed the tensions between activist demands for short-term gains and the pharmaceutical industry’s need for sustained R&D investment. Here’s how the drama unfolded—and what it means for investors.

The Campaign: Starboard’s Bold Play

Starboard’s campaign began in October 2024 when it revealed a $1 billion stake in Pfizer, representing 0.6% of the company’s then-$162 billion market cap. The firm accused CEO Albert Bourla of mismanaging the post-pandemic windfall, arguing that costly acquisitions and poor capital allocation had cost shareholders $20–60 billion in lost value since 2019. Starboard demanded Bourla’s ouster and proposed installing two former Pfizer executives, Ian Read and Frank D’Amelio, to steer a turnaround.

But the campaign faltered almost immediately. Both Read and D’Amelio withdrew their support after Pfizer threatened legal action over compensation clawbacks and non-compete clauses. This misstep weakened Starboard’s credibility, yet the firm pressed on, criticizing Bourla’s $43 billion acquisition of Seagen (2023) and a $5.4 billion deal for Global Blood Therapeutics—a move that led to the recall of its sickle cell therapy Oxbryta. Starboard also opposed Pfizer’s 2025 executive compensation plans, which Institutional Shareholder Services recommended shareholders reject.

Pfizer’s Defense: Data and Expert Backing

Pfizer fought back with financial results that defied Starboard’s narrative. In Q3 2024, revenue rose 30% year-over-year, driven by $854 million in sales from Seagen’s cancer drug PADCEV. Analysts countered Starboard’s claims, arguing that Pfizer’s acquisitions were strategic investments to offset patent expiries and bolster its pipeline. Yale’s Jeffrey Sonnenfeld and Steven Tian noted that Bourla’s focus on long-term growth—such as obesity therapies and oncology drugs—aligned with industry trends, even if short-term volatility persisted.

The Turning Tide: Starboard’s Stumbles and Pfizer’s Resilience

By early 2025, Starboard’s campaign faced further setbacks. It missed the January 25 deadline to nominate a director for Pfizer’s April annual meeting, delaying its influence until at least 2026. Meanwhile, Pfizer’s pipeline showed promise: PADCEV’s sales grew steadily, Nurtec (migraine therapy) gained market share, and its GLP-1RA obesity drugs positioned it to compete with Novo Nordisk and Eli Lilly.

Despite these positives, Pfizer’s stock languished, trading near 52-week lows in early 2025. Analysts cited poor communication as a key issue; investors remained skeptical of the pipeline’s long-term value and uncertain about how acquisitions would translate to earnings.

Broader Context: The Rise of Activism—and Its Limits

Starboard’s Pfizer campaign was part of a broader wave of activism. In 2025, global activist campaigns surged by 17% in Q1, fueled by market volatility and U.S. trade policies. Yet Pfizer’s story highlighted the challenges activists face in complex industries like pharma, where R&D timelines and regulatory risks defy quick fixes.

Notably, only 26% of 2025 campaigns demanded mergers or asset sales—a sharp drop from historical norms—as companies resisted breaking up. Meanwhile, ESG-related proposals fell sharply, with regulators and corporations finding middle ground to avoid proxy fights.

Conclusion: A Pharma Leader’s Crossroads

Pfizer’s survival of the Starboard campaign underscores two critical truths. First, activist campaigns can backfire when they ignore sector-specific realities: pharmaceuticals require patient capital and R&D investments that rarely deliver quick wins. Second, leadership continuity matters—Bourla’s retention of support from shareholders and analysts suggests that his long-term strategy, though imperfect, aligns with Pfizer’s competitive needs.

The data tells the story: Pfizer’s Q3 2024 revenue growth (30% YoY) outpaced the NYSE Arca Pharma Index, which had dragged behind competitors by 132 points earlier in 2024. Its pipeline now holds assets like PADCEV (projected $1.5 billion in annual sales by 2026) and GLP-1RA therapies (a $20 billion market opportunity). While Starboard’s 2025 missteps reduced its leverage, Pfizer must now close the communication gap with investors to realize its valuation potential.

For investors, Pfizer remains a paradox—a company with undeniable scientific strength but a stock price that undervalues its future. The Starboard battle may have been lost, but the war for pharma’s future is far from over.