The Pharmaceuticals industry in general faces great issues involving drug development. Pfizer like its 11 other competitors are reliant on drug manufacturing of block buster drugs and their massive marketing power. Although entities such as Pfizer are pharmaceutical companies, it is also on of the largest marketing companies in the world with an average of 4 Billion spent annually Each block buster drug cost 1.5 billion to develop from finding (lab findings to animal trials) to post marketing, this is also time consuming as it takes 10-15 years with research it self and all regulation, patent, TGA and FDA approvals to name a few (IP Australia 2012). Also legislation is not in the pharmaceutical industries favor as patent laws only give monopoly on their findings of 10 to maximum of 25 years (IP Australia 2011).Drug development business are constantly in a race to see not who will come up with the new revolutionary drug but who will be the first, for example in 2006 Roche brought out similar drug RHHVF to Lipitor (Cholesterol lowering drug) which could have see the nearly out of patent drug, lose sales (Herper 2006). Similarly Merc tried to do the same with torcetrapid, more a blood pressure lowering drug but did receive a bad review from doctors (Herper 2006). Obviously delivery of the best drug would see the entity that developed it triumph, which Pfizer did and continues to do by not only complaining Lipitor with another drug to perlong Lipitor’s patent but also it continues to make Pfizer 12 billion each year (Herper 2006).
Pfizer was started in 1849 by Charles Pfizer, when he borrowed $2,500 off his father to purchase the Brooklyn factory that was the factor, warehouse and head quarters for the 60 years (Pfizer 2012).The German migrant, patterned with his cousin Erhart Pfizer (chemist) who developed their first pharmaceutical product, almond flavored toffee to treat intestinal infections, and creams to treat soars in 19th century America; which was very helpful for the soldiers during the civil war (Pfizer 2012).Pfizer expanded across America and the world from producing products such as citric acid for Coca Cola, Penicillin and Viga to name a few (Pfizer 2012). Many of the great block buster drugs such as Vigra, Lipitor and the up and coming Eliquis (apixaban) which will stop heart attack and stroke (currently in phase III clinical trials) (Pfizer 2012). Also produce a wide range of health care products, also world leading in veterinary medicine.The success of Pfizer is reliant on their mamas sales representative staff of over 35,000 and 15,000 scientist. Also cost of manufacturing and shipping is reduced thanks to their diver production facilities on almost every continent. Which differentiates them from all the other competitors, simply by the shear number of personals and money invested to fuel such operations (4 billion annually on R&D).
Media release giving update to general public, consumers, investors and health professional, all targeted and designed for each sector. 6 FB pages with average of 20,000 likes dedicated to different section of the company eg veterinary medicine, regions and countries, from New York to Egypt. Similarly their twitter present is strong with over 30,000 follower on their main account. 14 Youtube channels informing again consumers, investors and general public what they do in multiple languages from Portuguese, Belgium to Turkish. On top of that Pfizer makes regular segments on news for health advise, with partnership with government officials to increase their public presences.
Top 5 are in revenue capital are : Johnson & Johnson, Pfizer, Roche, Glaxo Smith Kline and Novartis with an average of 49.872 of revenue production annually per company (Herper 2012). The pharmaceutical industry is a reactive strategy their to serve and treat illness and ailment. Johnson & Johnson compete with Pfizer with block buster drugs but also health care product and medical instrument development. Their customer base are made of pharmacies, hospitals, private practice and vets.
Patents run out too soon for Pharmaceutical companies and cost to return ratio is not always worth it! The market (health care professionals) are moving to more customised treatments and one pill fits all is growing less desirable. Hence why they are decreasing their R&D budget and increasing their social presence to maintain customer linking and being market sensitive. Small companies in India are looking at making Vigra for 500% less the cost Pfizer did (Bate 2008).
Pfizer is well aware of companies such as Johnson & Johnson, and Merc making similar drugs and products who are trying to move on their market space. Hence why Pfizer makes products with less side effect to add value to customer, product and attract and return the end users. Need to diversify product range like Johnson and Johnson who are entering into medical instrument production. Pharmaceutical are not longer as profitable maybe diversify their company into a tangible product and services.
Pfizer wants to remain market orientated, so maybe should move in to preventative medicine and compete or collaborate with the likes of Johnson & Johnson (JnJ 2012). The budget cuts to R&D can be channeled into making these instruments, also recruit market analyst and competitor analyst who can give insight on what maybe the competitors next move.
Role out their Health care insurance globally. Use their strong media and social media presence to promote their new products and services, as well increase awareness of prevention is the best medicine (Pfizer 2012).
By 2030, the world will have wheat shortage as the world population increases, this will mean that, many consumers worldwide will be have an unbalanced nutrition that could cause to disease state (Anderson 2012). There are opportunities to expand product and service by expanding into a niche market that will potentially be the future food source of the world.
Less regulation surrounding GM food, which makes it not as desirable by investors at the moment. Product/crop is produced in matter of month not over a decade (Menz 2012). There are many people who hate GM food, as its not organic, believe they use high levels of pesticides and not health, when it is not the case. Possible media presence and education of the general public can sway or make the public aware of the dilemma the world will face and benefits of using GM food.
Pfizer case study
“You have to be careful about being too careful” ~ Beryl Pfizer BY: Peter Morgan ID #: 2057061 S
Industry breakdown Pfizer GlaxoSmithKline Sanofi-Aventis Novarts Others
Industry BackgroundS ~ $1 Trillion Industry made up of of the big 12 pharmaceuticalsS High cost of drugs $1.5 BillionS Time consumingS Increasingly shorter patentsS Competitive market S Similar drug developed S Drive cost of marketing also cost cut strategy S Others have diversified their portfolio to remain competitive
PfizerS Oldest pharmaceutical company out of the 12 big corporate giantsS Mamas work force S 35,000 sales representatives make average of $621,032 S 15,000 scientists and R&D personals. S R&D and manufacturing facilities on almost every contentS Diverse products and services S Pharmaceuticals such as Vigra, Lipitor and the up and coming Eliquis (apixaban) S Health care products such as Advil, Centromere and chap stick S Health care insurance (small and local). S World leading in veterinary medicine
PfizerS Second biggest market capital of $190 BillionS Strong and transparent media and social media presences S Continues updated media release on their website S Facebook presence S Twitter S Youtube S TV presence S Total of 2 million followersS Strong government relationship
Market Segmentation Asia-Pacific Europe Americans
The CompetitionS 12 major pharmaceuticals world wide including Pfizer.S Either European or American basedS Stronger internet presenceS Diversification of product and services
End of an EraS Block buster drugs are less desirableS Budget and personal cuts S R&D budgets cut by up 3 billion dollars per year S Reduction in sales representatives S Pfizer by 3000 S GlaxoSMithKline 4000S Patent expiry generic drugs S 42% of drugs off patent by 2013
The problemS Competitors with similar drugsS Small market spaceS Product orientated (Pharmaceuticals and health care products).S Have segmented the market but not yet implemented any market or corporate strategiesS Lack of diversification
Medical instrumentS Move into preventative medicineS Compete and or collaborate in production of medical instrumentS Use their resources to remain market orientatedS Anticipate competitors next move
Health insuranceS Goloblise Health Care insuranceS Use their strong brand valueS Maintain customer relationshipS Use their media and social media presenceS Show the end users that they care not only about how they are treated by what they eat (Preventative measures).
Orphan DrugsS To treat a minority group 200,000 peopleS Highly risky, but not many companies want to venture thereS High return S Anti lung caner drug at $115,210 per patient per year
GM FoodS Opportunity for diversification of product and servicesS Currently a Niche marketS Not too many competitorsS Potential to expandS High profit margins
GM FoodS World wide shortage of food by 2030S Less regulation surrounding itS Can rely on trade secrets than patentsS Faster turn over of product, BUTS Not widely understoodS Organic produce are still very popular
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