WHEN: Tonight, Tuesday, September, 29th at 9PM & 1AM ET
WHERE: CNBC's "Executive Vision"
Following are excerpts from the unofficial transcript of a CNBC EXCLUSIVE roundtable interview with CNBC's Melissa Francis and Simon Hobbs and DR. BILL FRIST, Partner Cressey & Co and Former Senate Majority Leader; BILL GEORGE, Professor of Management, Harvard Business School and Former CEO, Medtronic; JEFFREY KINDLER, Chairman & CEO, Pfizer; GERARD KLEISTERLEE, President & CEO Royal Phillips Electronics; and DAVID SNOW, Chairman & CEO Medco.
CNBC's 5-part global series "Executive Vision," premieres tonight, Tuesday, September 29th at 9PM & 1AM ET on CNBC. The series will air for five consecutive Tuesdays at 9PM and 1AM ET on CNBC. The series explores the art of leadership within five specific industry groups beginning Tuesday, September 29th at 9PM and 1AM ET and for five consecutive Tuesdays at 9PM and 1AM ET on CNBC.
All references must be sourced to CNBC.
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KINDLER ON WYETH ACQUISITION:
KINDLER: THIS IS ABOUT A TRANSFORMATION OF OUR COMPANY. WE'RE NOW GOING TO BE A COMPANY THAT'S NOT ABOUT ONE OR TWO DRUGS. WE'RE GOING TO BE A COMPANY THAT'S A LEADERS IN HUMAN HEALTH, ANIMAL HEALTH, CONSUMER HEALTH, PRIMARY CARE, SPECIALTY CARE, BIOLOGICS AS WELL AS SMALL MOLECULES. WE'RE GOING TO BE IN THE DEVELOPED WORLD AND DEVELOPING WORLD. WE'RE GOING TO BE SERVING EVERYTHING FROM PRENATAL VITAMINS TO INFANT FORMULA ALL THE WAY TO ALZEIMER'S DRUGS. AND THAT KIND OF DIVERSIFICATION THAT WYETH PROVIDES TO US REALLY TRANSFORMS THE COMPANY IN A WAY NO OTHER DEAL HAS DONE.
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KINDLER ON BIG PHARMA'S IMAGE:
SIMON HOBBS: YOU HAVE SAID THAT DRUG COMPANIES ARE TOO OFTEN POTRAYED AS THE BAD GUYS. ARE YOU TAKING THAT ON SPECIFICALLY YOURSELF? TRYING TO CHANGE THE IMAGE IN THAT RESPECT?
KINDLER: ABSOLUTELY. AND THAT'S NOT GOING TO CHANGE OVERNIGHT. I RECOGNIZE THAT. YOU KNOW, WE'RE A COMPANY AND AN INDUSTRY THAT HAS TO EARN TRUST WITH PEOPLE. AFTER ALL, WE'RE ASKING PEOPLE TO PUT OUR PRODUCT IN THEIR BODIES. WE'RE ASKING THEM TO TRUST US WITH THEIR LIVES AND THEIR HEALTH. CLEARLY OUR INDUSTRY HAS HAD SERIOUS REPUTATIONAL ISSUES OVER THE YEARS. SOME OF IT DESERVED; SOME OF IT NOT DESERVED. IT'S SOMETHING WE HAVE TO CONTINUE TO WORK ON. WE, OVER THE YEARS AT PFIZER, OVER RECENT YEARS, HAVE TRIED TO MAKE MAJOR PROGRESS IN THAT RECORD AND CHANGE OUR PRACTICES. WE'RE GOING TO CONTINUE TO DO THAT.
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KINDLER ON $2.3 BILLION FINE:
KINDLER: I VERY VERY MUCH REGRET THE CONDUCT THAT LED TO THAT CONCLUSION. THAT INVOLVED A DRUG THAT WAS PULLED FROM THE MARKET ABOUT FOUR YEARS AGO. WE ACKNOWLEDGED THE MISCONDUCT. SINCE THE TIME THAT OCCURRED, WE HAVE MADE SIGNIFICANT IMPROVEMENTS AND ENHANCEMENTS IN OUR COMPLIANCE SYSTEM. AS WE SIT HERE TODAY, WE ENGAGE IN EXTREMELY ROBUST TRAINING. WE HAVE A COMPLIANCE OFFICER THAT REPORTS DIRECTLY TO ME.
SIMON HOBBS: COMPLIANCE AND TRAINING, DOES THAT CHANGE THE CULTURE? DOES THAT CHANGE THE VALUE?
KINDLER: I THINK THAT'S A GREAT QUESTION, SIMON. CHANGING THE CULTURE AND CHANGING THE VALUES IS AN ONGOING THING. WE'RE WORKING ON IT AND REFLECTING IT IN PEOPLE'S COMPENSATION SYSTEMS. IN RECENT YEARS WE HAVE ACTUALLY TAKEN DISCIPLINARY ACTION AGAINST MANAGERS NOT BECAUSE THEY ACTUALLY ENGAGE IN THIS CONDUCT, BUUT BECAUSE WE HAVE CONCLUDED THEY HAVE ALLOWED A CULTURE TO EXIST THAT WE CANNOT TOLERATE.
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KINDLER ON GENERICS:
KINDLER: YOU CAN'T BE IN THE MEDICINE BUSINESS TODAY AND NOT BE PART OF THE GENERIC DRUG INDUSTRY. THAT IS THE PLACE THAT IS GOING TO PROVIDE ACCESS TO THE HUNDREDS OF MILLIONS OF PEOPLE IN THE GLOBE THAT DON'T HAVE ACCESS TO MEDICINES. WE ARE IN THAT BUSINESS, WE'RE SIGNIFICANTLY IN THAT BUSINESS AND WE'RE GETTING INTO IT EVEN MORE. TOMORROW'S GENERIC DRUGS ARE TODAY'S INNOVATIONS. ALL OF THESE GENERIC DRUGS, AND I THINK DAVID WOULD AGREE WITH ME, THAT HE'S SELLING, WERE ONCE INVENTED BY PHARMACEUTICAL COMPANIES. THOSE WERE REALLY GOOD DRUGS WHEN THEY WERE INVENTED. AND IF WE WANT TO HAVE GOOD DRUGS TOMORROW, WE HAVE TO HAVE BOTH.
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SNOW ON WAL-MART COMPETITION:
MELISSA FRANCIS: THE WAL-MART QUESTION: WHEN WAL-MART COMES ON TO SOMEONE'S TURF, AS THEY HAVE WITH YOURS, YOU HAVE SAID A LOT OF PEOPLE, QUOTE, SHAKE IN THEIR BOOTS. HOW DO YOU GET YOUR OWN EMPLOYEES NOT TO DO THAT. WE TALKED ABOUT THIS BEFORE THE SHOW AND YOU CHUCKLED THE WAY YOU ARE NOW...
DAVID SNOW: OKAY-SO YOU SET A CLEAR VISION. WE HAVE A STRATEGIC PLAN. AND WE'RE VERY COMFORTABLE COMPETING WITH WAL-MART, WITH CVS CAREMARK, WITH EXPRESS SCRIPTS, WITH ALL OF OUR COMPETITORS. THAT'S WHAT MAKES THE PRIVATE SECTOR GOOD. THERE IS REAL COMPETITION. PEOPLE HAVE CHOICES. WHEN A WA-LMART SAYS 'W'RE COMING IN' REMEMBER, WAL-MART'S A RETAILER FOCUSED ON PRIMARILY SELLING THINGS IN THEIR STORE. THEY DO NOT HAVE A SERVICE MODEL. THE INDIVIDUAL PATIENT WALKING INTO THE STORE IS NOT MAKING THESE BENEFIT PURCHASING DECISIONS. IT IS A CLIENT WHO IS A PAYOR FOR MANY EMPLOYEES, AND IT'S A TOTALLY DIFFERENT CONVERSATION WITH THEM. AND THEY HAVE A COMPLETELY DIFFERENT SET OF NEEDS. SO IF WE STRUCTURE OUR BUSINESS AND OUR INNOVATIONS ON THE NEEDS OF THAT CLIENT, WE WILL WIN THE MARKET.
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FRIST ON MANDATED HEALTH CARE:
BILL FRIST: SEVENTY PER CENT OF ALL HEALTH CARE COSTS TODAY ARE BEHAVIORALLY REFLECTED IN SOME SHAPE OR FORM. OBESITY IS THE BIG DRIVER TODAY. IN THE PAST IT WAS SMOKING. THE GOVERNMENT CAME IN AND SAID 'WE'RE GOING TO TAX YOU'. AND WITH THAT SMOKING PLUMMETED IN THE U.S. GLOBALLY IT HASN'T. BUT YOU SHOW GOVERNMENT CAN COME IN. THE SAME WAY IT'S BEING DEBATED HOW MUCH SHOULD A COMPANY COME IN AND EITHER WITH A CARROT, HERE ARE SOME AIRLINE MILES IF YOU PARTICIPATE IN THIS WELLNESS PROGRAM, AND THAT HAS BEEN SUCCESSFUL WITH COMPANIES, OR HERE IS A LITTLE BIT OF A STICK. IF YOU DON'T CUT DOWN WHAT YOU'RE EATING OR LOSE X NUMBER OF POUNDS, YOUR DEDUCTIBLE GOES UP. AND THERE'S A LOT OF DEBATE RIGHT NOW. AND NOBODY HAS THE ANSWER YET.
MELISSA FRANCIS: IS THAT FAIR?
BILL FRIST: OF COURSE. IT'S UP TO THE CEO.
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FRIST ON TORT REFORM:
FRIST: WE'RE TALKING ABOUT LEADERSHIP PRINCIPLES. YOU GO IN TO REPLACE A VALVE, A HEART HAS A POOR VALVE. YOU REPLACE A VALVE. YOU'VE THOUGHT ABOUT IT, AND BASED ON ALL YOUR TRAINING AND ALL YOUR EXPERIENCE, THAT SHOULD DO IT. BUT YOU DID IT AND IT WASN'T ENOUGH AND THE PATIENT DIED. HOW DO YOU HANDLE IT? IT'S A MISTAKE. THEN YOU BACK OUT, ABOUT TORT REFORM AND HOW IT'S A $100 BILLION PROBLEM IN THIS COUNTRY. SO DO YOU COME ABOVE AND HAVE TORT REFORM, WHICH I AM VERY MUCH FOR? OR DO YOU COME BACK TO A BASIC LEADERSHIP POTENTIAL AND SAY 'YES I MADE A MISTAKE. I DID WHAT I COULD, DID MY BEST' AND GO DIRECTLY TO THE FAMILY AND HAVE THAT DIALOGUE, HAVE THAT COMMUNICATION. IF SO, I AM ABSOLUTELY CONVINCED THAT YOU WOULDN'T HAVE THE BIG LAWSUITS; THAT PATIENT'S FAMILY WOULD ACTUALLY UNDERSTAND. AT THE END OF THE DAY IT'S A BASIC HUMAN, INTIMATE LEADERSHIP POTENTIAL OF COMMUNICATION, HONESTY BUILT ON TRUST WHETHER IT'S THE BRANDS THAT YOU HAVE OR IT'S THAT DOCTOR-PATIENT INTIMATE INTERACTION.
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