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Pfizer, Inc. Animal Health Products

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Pfizer, Inc. Animal Health Products Pfizer, Inc. Animal Health Products Presentation Transcript

  • Pfizer, Inc. Animal Health Products Janet Glidden Karyn Woolley 2-28-06
  • The Case Less Demand for U.S. beef and the resulting sales decline of Pfizer products
  • Who Is Pfizer
    • Founded1849; Headquartered in New York, NY
    • 70 Manufacturing facilities; 9 R & D sites in 5 countries
    • Listed on the New York Stock Exchange
    • Employs 115,000 employees in 180 countries
    • Primary Lines of Business:
      • *Pharmaceutical Human Health (Lipitor, Viagra, Celebrex)
      • *Consumer Health (Listerine, Visine, Rolaids, Sudafed)
      • *Animal Health (Revolution)
  • Pfizer
    • Mission Statement: "We will become the world’s most valued company to patients, customers, colleagues, investors, business partners, and the communities where we work and live."
    • Purpose: "We dedicate ourselves to humanity’s quest for longer, healthier, happier lives, through innovation in pharmaceutical, consumer and animal health products."
  • Pfizer Animal Health
    • Pfizer Animal Health has two divisions:
      • Companion Animals (pets)
            • *cats, dogs, & horses
      • Livestock
        • beef cattle, dairy cattle, & pork
  • The Environment
    • Economic Conditions & Trends
      • *NAFTA Allows imports from Canada & Mexico
      • *Mad Cow Scare prevents Imports to Asia
    • Cultural and Social Trends
      • *Public Concerns over Medicine Safety (celebrex, vioxx recalls)
      • *Working families want fast, microwavable meals
      • *Nutrition a growing concern (low fat/low cholesterol)
      • *Corporate Responsibility Wanted
      • Perceptions: high profits & Executive pay = soaring prices
          • Asian tsunami & Pakistan earthquake relief – $1+ million donated
          • Hurricane Katrina & Rita – $2+ million donated
    • Political and Legal Issues
      • *Lawsuits: US & British courts uphold Lipitor patents until 2011
      • *FDA regulations tighten due to recalls
      • *Access to prescriptions for the needy
  • The Industry
    • Increasing Demand
            • Demands for animal health products are estimated to reach 7.8 billion in 2006
    • Gains will be driven by:
            • Continuing threats of animal disease
            • Ongoing food safety concerns
            • Growth in pet populations
    • The Pharmaceutical industry as a whole has been underperforming the past 5 years due to:
            • Expiring patents
            • Less than robust pipeline prospects
            • Consumers’ concern over drug safety
            • Managed care controls on spending
  • A Glance at the Competition 28 million 81,000 Novartis 23 million 63,000 Merck (Merial) 19 million 51,000 Weyth 40 million 114,000 Bayer 52 million 115,000 Pfizer 2005 Net Revenues Number of Employees Competitor PFIZER'S COMPETITORS
  • Marketing Stats
    • $3 Billion Ad Budget:
      • 4 th largest in the U.S.
    • 38,000 Sales Reps:
    • equivalent to three U.S. Army divisions
    • 8,500 Lipitor Rx’s dispensed per hour:
      • In the U.S. in 2004
      • $74.8 million in revenue
  • Marketing Strategy
    • Market direct to consumers through
      • *Prime time t.v. & magazine ads
    • Marketing Armies
      • *Physicians have been inundated – some seeing 3 Pfizer reps a day
    • Mass marketing approach
      • *Worked well with drugs targeting large population’s unmet needs
      • *Will not be effective for targeted genetic drugs of the future
    • Pfizer Educational Programs
        • *Ask Pfizer On-line
        • *Cartoon Pill Phil
    • Pfizer sells animal products only to
      • *Vets & “feed and seed” stores
      • *Farmers & ranchers perceive vets as their most trusted contacts
  • Pfizer SWOT Analysis -Strengths-
    • Currently the largest pharmaceutical company in the industry
    • Cash Rich with a strong balance sheet to borrow against; Adequate revenues to pursue aggressive advertising/marketing programs
    • Actively seeking Licensing and Acquisition opportunities
    • Implementing cost cuts to add 4 Billion in savings by 2008
    • Educational programs for Consumers
    • Pipeline prospects expected to generate 8 billion in sales by 2010
      • (Potential Blockbuster Torcetrapib/Lipitor)
    • Pfizer has consistently superior products that competitive products typically can’t match
    • Pfizer’s reputation is highly respected among vets and ranchers
  • Pfizer SWOT Analysis Weaknesses
    • Reduction of R & D spending by 13% 2005 to 7.4 billion
    • Compensation packages for top executives are under scrutiny
    • Poor public relations regarding maintenance of high prices bringing drugs beyond the reach of the potential users
    • Pfizer uses animals to test it’s products
    • Shortage of new blockbuster drugs in the pipeline
    • Mass marketing strategy will not be effective for future oncology medications unique to individual genetics
  • Pfizer SWOT Analysis Opportunities
    • China; aging population, increasing obesity and heart disease offer new growing market
    • Potential sale of Consumer Health Division; Listerine, Benedryl
    • Licensing/acquisition opportunities
    • $100 million dollar study on Celebrex
    • Torcetrapib (lowers LDL, raises HDL)
    • Successful Lipitor patent litigation
  • Pfizer SWOT Analysis Threats
    • Intense competition from generics
    • Fewer pipeline prospects
    • Consumer safety concerns (Vioxx, Celebrex)
    • Patent expirations; drugs that generated 11 billion sales in the past will lose patent protection in 2006 including Zoloft
    • Tightening legislation as FDA becomes increasingly discriminating in the face of Vioxx recall
    • Litigations expenses necessary to defend intellectual property
    • Competition from other pharmaceutical companies looking for licensing/acquisition opportunities
    • $100 million study on Celebrex to determine safety/threats
    • Failure of target industry, such as the beef industry in the US.
  • The Problem
    • Less Demand for U.S. beef and the resulting sales decline of Pfizer products
    • Consumers Want:
      • Food Safety (concerns: mad cow disease)
      • Healthy Alternatives (chicken, fish)
      • Ease of preparation (microwaveable products)
    • Barriers to potential new markets
      • Trade barriers due to mad cow
  • Options
    • Reduce expenditures on declining beef market & recognize & invest in new markets such as poultry & pets
    • Focus on Co. reputation & work to increase public’s perception of Pfizer & the pharmaceutical industry
    • Remain committed to working with U.S. beef growers to help return producers to profitability
  • Recommendation: Partner with U.S. beef growers to help return producers to profitability
      • Stand firm & remain committed to working with beef producers
        • Demand for beef aboard is growing, eventually importing will open to U.S. & demand will be substantial
        • Demand for animal pharmaceuticals will follow
      • Invest in growing animal health product markets abroad
        • Target those presently supplying beef to Asia (Latin America)
        • Establish market share now making it difficult for competitors to get a foothold in the future
      • Assist beef growers to boost perceptions regarding beef’s nutritional benefits
        • Pfizer has extensive skill and experience in marketing and advertisement
        • Pfizer has a more than sufficient advertising budget
      • Pfizer’s products are recognized as consistently high quality
        • Build on the Trust that ranchers have in Vets
      • Invest in genetic & parentage R & D to assist ranchers document age/heritage
        • Pfizer has extensive capital to invest further in R & D