Pfizer said it was looking to sell or spin off its consumer healthcare business in a move that could fetch up to $14bn of cash for the pharmaceuticals group and set off a flurry of dealmaking.

The drugmaker said it was considering a range of options for the business, which makes Centrum vitamins and ChapStick lip balm, including “a full or partial separation . . . through a spin-off, sale, or other transaction”. It added that it might ultimately decide to keep the division.

Ian Read, Pfizer chief executive, said the drugmaker was a leader in over-the-counter healthcare products that can be bought without a prescription, but that the unit was “distinct enough” from its main medicines business for it to do better outside the company.

Mr Read has hinted at divesting the consumer business in the past few months, telling investors on a recent earnings call that the unit was “subject to periodic reviews as to whether there’d be more value created being outside Pfizer rather than in”. 

In December 2015, Rakesh Kapoor, chief executive of Reckitt Benckiser, said he would be “very interested” in Pfizer’s consumer health division if it were to come up for sale. However, Reckitt has since paid $16.7bn for Mead Johnson, the baby formula maker, raising doubts over whether it can afford a second large deal. 

Nestlé, the Swiss foods group, has said that it is in the market for such assets, while analysts also cite drugmakers such as GlaxoSmithKline, Bayer, Sanofi and Johnson & Johnson as potential buyers.

Pfizer’s decision to review a division that makes dietary supplements and cold remedies underscores a perennial debate over whether pharmaceutical companies should own consumer divisions.

Some companies believe such businesses provide stability in an industry plagued by patent expiries and unpredictable drug development schedules, while others argue that the units suck up capital and attention that should be spent on discovering lucrative new medicines.

Merck, the German drugmaker, recently announced its intention to explore a sale of its consumer division, which makes Seven Seas vitamins and nasal decongestants.

Pfizer vacated the industry in 2006 when it sold its consumer division to J&J for $16.6bn, parting ways with brands such as Listerine mouthwash and Nicorette anti-smoking treatments. But it subsequently took on a new portfolio when it acquired Wyeth in 2010. 

For Mr Read, who became chief executive in 2010, divesting the consumer business would mark the biggest shake-up of the company since it spun out its animal health unit in 2013, creating Zoetis, which now has a market value of $31bn. 

He has since tried to reshape the drugmaker through the acquisitions of Anglo-Swedish AstraZeneca and Dublin-based Allergan, although both attempts were thwarted by politicians worried about jobs and lost tax revenues. 

One large Pfizer investor said he interpreted the announcement as a sign that the company wanted to raise cash to do something “transformative” in the pharmaceuticals sector, such as buying Bristol-Myers Squibb, a leading maker of cancer immunotherapies that has a market value of $105bn. 

He added that it signalled Pfizer believed there was at least some chance that the Trump administration would pass an overhaul of the US tax code, which would allow companies such as Pfizer to repatriate foreign cash piles worth tens of billions of dollars and spend them on dealmaking and shareholder buybacks. 

Bankers say that if Pfizer were to begin dealmaking with gusto it would thaw the market for mergers and acquisitions in the pharmaceuticals sector, which has been subdued in recent months amid uncertainty over tax reform and drug pricing legislation. 

Additional reporting by Scheherazade Daneshkhu in London

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