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Sanjaya
Tarumanegara University Post Graduate-2014
Company Overview
Founded 1849 in New York City by Charles Pfizer & Charles
Erhart as a manufacturer of fine chemicals.
2014: an American multinational pharmaceutical
Popular products: Lipitor, Lyrica, Diflucan, Zithromax,
Viagra, Celebrex
*2013
Big Pharma
Total Revenues (in Net income/ (loss) R&D Expenses (in Fortune 500
Rank Company
millions of USD) (in millions) millions) Ranking[1]
Opportunities
1. Technology advancement Strengths- Weakness-
2. Opportunities in Emerging Markets Opportunities Opportunites
3. Longer life expectancy Focus on vitamins & Spinoff generic
4. High entry barriers supplements (S1, O3) brands (W1, O2)
Finance all R&D
5. Increase of chronic disease
proposal (spread the
Threats bets) (S3, O1)
1. Increase strengh of US Dollar
2. Higher effective tax rate
3. Patent Litigation settlement
4. Medicaid or other similar gov. Strength-Threats Weakness-
programs Threats
Move HQ to other
5. Development of blockbuster drugs by country with Acquire promising
competitors stronger currency competitors with
and lower tax (S3, potential
T1,4) blockbuster drugs
(W3, T5)
SPACE Matrix
Industry Position Competitive Position Financial Position
Opportunities of
2.0 Brand image -2.0 7 A firm whose financial
Blockbuster drugs
6 strength is a dominating factor
Generic drug threats 2.0 Market share -2.0 in the industry.
5
Aggressive stratgies:
Medicaid programs 3.0 Product quality -1.0 4 Horizontal integration
Patent Litigation 3.0 Customer Loyalty -2.0 3 Market penetration
2 Product development
X axis 2.5 -1.8 0.8
1
Financial Position Stability Position 0
Revenue 7.0 Growth Potential -4.0 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7
-1
Stability Position
IE Matrix IFE
(2.80)
4.0 3.0 2.0 1.0
4
3
Hold & Maintain
EFE Market Development
(2.70) Entry into emerging markets
Product Development
Development of new drugs
2
1
The Grand Strategy Matrix
Rapid Market Growth
Quadrant I
1. Market Penetration to
emarging markets
2. Product Development:
R&D
3. Horizontal Integration:
Weak Acquire Competitor Strong
Competitive Competitive
Postion Postion
Tax inversion
The only way for a shark to
survive is to keep going
Bigger revenue forward. To maintain its
leadership, Pfizer will again
need to make a major
Cost synergy acquisition in the next 4-5
year.
-John LaMattina
Forbes.com
Acquire new expertise 5/06/2014
Proposed Pfizer Astra Zeneca Merger
The offer: US$ 117 billion of US$ 92 per share.
Pfizer will hold 74% of the combined company.
Tax benefit of moving Pfizers HQ to UK: US $ 12 bio.
Astra Zenecas strong points:
Cancer immunotherapy
Pulmonary disease
Area of complimentary research:
Cardiovascular
Metabolic
Oncology
Patents: Pfizer 80%, AZ 20%.
Mergers in the industry are done out of weakness. We are not weak.
-Bill Steere
(Pfizer CEO 1991-2001,
a year before acquiring Warner-Lambert)