Pfizer Inc. said Tuesday it is exploring a sale or spin-off of its consumer-health business, the company's latest move to double down on prescription drugs and a potential prelude to more deal-making.
The drugmaker left open the possibility of holding on to the unit, but Pfizer has been cutting ties with nonpharmaceutical businesses, as rivals have pushed to consolidate in the $233 billion global consumer health market.
Pfizer said it would look at a "full or partial separation" of the business and make a decision on how to proceed next year.
"Although there is a strong connection between Consumer Healthcare and elements of our core biopharmaceutical businesses, it is also distinct enough from our core business that there is potential for its value to be more fully realized outside the company," Chief Executive Ian Read said in a statement.
Proceeds from a sale, which analysts said could top $10 billion, would give Pfizer more firepower to deal for prescriptiondrug companies. Last year, it bought cancer-drug developer Medivation for $14 billion.
Pfizer's consumer-health business, which sells wellknown brands like Advil pain medicine, Centrum vitamins and ChapStick lip balm, generated about $3.4 billion in revenue last year.
The cash flow and steadily growing sales bolstered earnings in the past few years when Pfizer was coping with generic competition for some of its top-selling products like the cholesterol drug Lipitor and pain medicine Lyrica.
The company's performance has picked up in recent quarters, as Pfizer has worked its way through the bulk of its big patent expiries and sales have risen for new drugs like Ibrance breast-cancer pills and the blood-thinner Eliquis.
Shares in Pfizer, which are up 11% so far this year, were flat Tuesday, trading at $36.11. Pfizer has retreated from the consumer-health market before. In 2006, Johnson & Johnson, the No. 2 company in that market, bought Pfizer's legacy consumer-health business for $16.6 billion.
Pfizer got back into the business as a byproduct of its $68 billion takeover of Wyeth in 2009, but continued to tighten its focus on prescription drugs by parting ways with animal-health and other noncore units.
The New York-based company also has sat on the sidelines as rivals like Bayer AG, GlaxoSmithKline PLC and Sanofi SA did deals to bulk up their consumer-health businesses.
Pfizer now ranks fifth in the world by market share, according to Euromonitor International market-research firm. Glaxo ranks first. All of the consumer-health market leaders could have interest in adding Pfizer's business.
So could Swiss food company Nestlé SA, which has indicated interest in doing deals in markets growing faster than packaged goods like consumer health.
Meanwhile, Germany's Merck KGaA has said it is considering selling its consumer health business, which had €860 million (about $1 billion) in net sales last year.
—Allison Prang contributed to this article.
BY JONATHAN D. ROCKOFF