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PHARMACEUTICAL EXECUTIVE

Megamergers shook up the industry in 2009, shuffling the deck of pharma’s top companies. Find out which companies emerged on top, who might be next, and how those best positioned to weather a challenging business environment are poised to rip the rankings apart over the next few years
By Patrick Clinton and Mark Mozeson

19. 3. Vietnam. And Teva (number 16) continues to merge its way up the list. which appear set to replace small molecule drugs like Lipitor as top sellers within the next few years. and it doesn’t always feed into continued organic growth. is now part of Pfizer. 2. 24. but once the impact of mergers is taken into consideration. too. Malaysia. five of the top six pharma companies have revenues hovering around $40 billion. have finally caught up. and giving the company additional reach into a growing field. 45. 33. the smallest companies on the 50 had revenues in the $500 million range.com 69 he Pharm Exec 50 ranks the world’s largest pharmaceutical companies by global sales of prescription drugs. 10. including getting drugs approved. after an abysmal year). look for companies to respond aggressively to the most important piece of pharma news in recent years: Sales in emerging markets. 27. 44. 9. with Pfizer leaping ahead to more than $60 billion. 23. 20. of course. Chile. 29. it is hard to turn away from such an opportunity. 22. 25. 47. T The PHARM EXEC 50 1. no matter what the difficulty. with Novartis prepared to take on ophthalmology specialist Alcon (this year’s number 38). over the next five years the “pharmerging” markets will generate as many new dollars in pharma sales as the traditional markets. India. providing our almost perennial number one company with a solid entrée into biologics and vaccines as well as a return to OTC medicines. 14. Today. Where in recent years. Ten years ago. 11. 46. 42. Schering-Plough (last year’s number 15) has been combined in a reverse merger with Merck. 6. The track record of the industry is mixed when it comes to mergers. 48. 12. 5. bringing the Swiss giant to the $40 billion Rx revenue range. But given the sharp trend toward further cost containment in the US. 34. 17. 50. Though there’s considerable variation. and Solvay (32) by Abbott. Russia. the next round of mergers has already begun. and pricing. Growth by acquisition is not always a sign of strength. which have been growing at a faster rate than sales in established markets. 18. with new drug approvals slowing to a trickle. 43. 21. creating a company that should rise to the number-four slot next year. 28. 36. Turkey and Mexico. These countries present many challenges. Meanwhile. Revenue rankings will also be influenced by the success of some companies in large biologicals. Genentech (19) was acquired by Roche. the transformational deals of the past year seem likely to inspire renewed interest in mega-mergers. 38. China). last year’s number 10. for the largest pharma companies to hit a new revenue benchmark. And not just smaller companies: Wyeth. 26. an Irish firm that has never appeared on the 50 before—but will jump to the middle of the list next year thanks to P&G’s Avonex business. 31. all but four brought in $2 billion or more.MAY 2010 www. The most striking theme in this year’s list is the continued pace of sector consolidation: many companies have disappeared from the list as a result of mergers over the course of 2009. 35. the merger wave is far from over. 40. 30. 7. 4. Look. but in the current climate. while Procter & Gamble’s pharmaceutical unit (39) has become part of WarnerChilcott. 49. with Rx revenues of about $40 billion. 8. Look for the world’s largest generics company to close in on a top-ten spot within the next year or two. protecting intellectual property. but in an expanded roster of countries including Saudi Arabia. Venezuela. 41. 39. 16. building distribution systems. Japan and Europe. pharma companies have been investing in emerging markets for several years—not just in the “BRIC” countries (Brazil. This year’s target was Germany’s Ratiopharm (42. 37. 15. Pharma M&A has been dominated by mid-size deals and “bolton” acquisitions. and the question is whether it makes sense to try to keep up. Finally. It’s not quite visible in this year’s figures. Thailand. 13.pharmexec. According to IMS Health. Pfizer Sanofi -Aventis Novartis GlaxoSmithKline Roche AstraZeneca Merck Johnson & Johnson Eli Lilly Bristol-Myers Squibb Abbott Bayer Boehringer Ingelheim Amgen Takeda Teva Novo Nordisk Astellas Daiichi Sankyo Otsuka Eisai Merck KGaA Gilead Sciences Baxter International Mylan Servier Chugai Genzyme Mitsubishi Tanabe UCB CSL Allergan Forest Menarini Nycomed Biogen Idec Shire Alcon Apotex Lundbeck Celgene Ratiopharm Cephalon Dainippon Sumitomo Hospira Watson Actavis Shionogi Kyowa Hakko Kirin Meda . “Big Pharma” is getting bigger. 32.

7] Corzaar/Hyzaar [3.4] Lyrica [2.3] Procrit/Eprex [2. Health & Life Sciences. About the Authors: Patrick Clinton is marketing director.1] Abilify [2. and contract manufacturing are not.1%] Roche Basel. He can be reached at mark.8] Celebrex [2.9] Crestor [4.1] Nexium [5.0] Seroquel [4.com] [8. generics and vaccines are included.8 $25. as they can be affected by fluctuating exchange rates. For most American and European pharmaceutical companies.1] Pandemic flu vaccine [1.0] Plavix [6.8 $37. New Jersey [merck. England [gsk. we have converted their numbers using the average interbank rate for the last day of the fi scal year.0] MabThera/Rituxan [5. Switzerland [roche. Oliver Wyman.com] [6.5%] Novartis Basel.9%] Johnson & Johnson New Brunswick.4] Avastin [6.9] Valtrex [2.4] Sanofi -Aventis Paris.9%] AstraZeneca London. for most Japanese companies. it means the year ending March 31.6] Reyataz [1.0 $38.8] Diovan/Co-Diovan [6.clinton@oliverwyman. These are calculated differently from our sales figures.5 $21.1] Humalog [2. Some charts that appear in this article are based on numbers from IMS.4] Lovenox [4. As far as company documentation allows.5] Singulair [4. including IMS reports. Indiana [lilly. 2009. Mark Mozeson is partner.pharmexec. Percentage growth figures should be treated with caution. In the case of private companies that do not report results.6 $32.3%] Note about the listings: Companies in the Pharm Exec 50 are ranked according to global human prescription drug sales.com] [26. Health & Life Sciences.2] Levaquin/Floxin [1.com] [6.2 $18. England [astrazeneca.com] $45.5] Seretide/Advair [7.70 PHARMACEUTICAL EXECUTIVE MAY 2010 www.4 $37.7%] $7845 $6567 $6308 $6286 $8570 $4409 $5845 $4591 $4300 $3647 Lipitor [11.9] Zometa [1.com] [9.com] [3. Oliver Wyman.2 $22.6] Januvia [1.com] [78. over-the-counter products.8 [2. 2009. royalties.0] Gleevec/Glivec [3. In most cases.4] Plavix [3. France [sanofi -aventis.9] Herceptin [5.7%] Bristol-Myers Squibb New York [bms.4 $42. Switzerland [novartis.7%] GlaxoSmithKline Brentford.8%] Merck Whitehouse Station. we have relied on outside estimates.4] Lantus [4.com .com. numbers are taken from annual reports or SEC fi lings for the fi scal year that end*Estimate ed in 2009. He can be reached at patrick.9] Remicade [4.6] Zyprexa [4. New York [pfizer. For companies that report revenue in currencies other than US dollars.com] [6.com] [-8.5%] Eli Lilly Indianapolis. that means the year ending December 31.mozeson@oliverwyman.com The Pharm Exec 50 Rank [2009 Rank] Company & Headquarters [website] 2009Rx Sales (Billions of USD) [change from 2008] 2009 R&D spend (Millions of USD) 2009 Top-Selling Drugs [Billions of USD] 1 [1] 2 [3] 3 [4] 4 [2] 5 [8] 6 [6] 7 [7] 8 [6] 9 [9] 10 [11] Pfizer New York. New Jersey [jnj.9] Cymbalta [3.

9 [25.7 11.4%] Neulasta/Neupogen [4.72 PHARMACEUTICAL EXECUTIVE MAY 2010 www.com] Astellas Tokyo. Germany [boehringer-ingelheim.0 $14.7 3.2 5.7% 39.9% 7. Japan [otsuka-global.5] Yaz/Yasmin/Yasminelle [1. PHARMACEUTICAL PRODUCTS BY SALES Total US Prescription Market 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Lipitor Nexium Plavix Advair Diskus Seroquel Abilify Singulair Actos Enbrel Epogen Remicade Crestor Avastin Neulasta Oxycontin US$ in Billions 7.com] [12.1 percent to approximately $300 billion 16 [18] 17 [22] 18 [20] 19 [21] 20 [25] Teva Petach Tikva.4 $14. Israel [tevapharm.3%] Amgen Thousand Oaks.1%] $802 $1521 $1635 $1897 N/A Copaxone [2. Japan [daiichisankyo.5 6.7 4.6 12.1% 12.0 3. Norway [novonordisk.6 $15.8 30. Illinois [abbott.com] [16.com] Daiichi Sankyo Tokyo.2 3.pharmexec.0] Percent of Global Sales Market North America Europe Asia/Africa/Australia Japan Latin America 2009 Sales (US$B) $323. California [amgen.6%] Pioglitazone [4.3 5.0 3.1] Prograf [2.0 2.com] SOURCE: IMS Health GLOBAL PHARMACEUTICAL SALES BY REGION.8 $9.2] N/A Novo Nordisk Bagsvaerd.com] [-2.com] $13.com 11 [12] 12 [13] 13 [16] 14 [14] 15 [17] Abbott Abbott Park.com] $15.8 $8.9 $9.4%] [1.com] Otsuka Tokyo.9 $106.3 3.6 4.2 4.4%] [-7.9 SOURCE: IMS Health grew by 5.0 $47.7%] $2744 $2253 $3010 $2864 $4657 Humira [5.5%] [21. Japan [takeda.1 $7.7%] [-0.4 $14.6 $95. Japan [astellas.2 [-6.6] Takeda Osaka.com] Boehringer Ingelheim Ingelheim. Germany [bayer.0 3.4 3.2%] [14.1] Olmesartan [2.7 US Prescription sales TOP 15 U.8 $263.8] Spiriva [3.0% 15% 2.S.2 3.4] Bayer Leverkusen.8 % Growth from 2008 1. 2009 .8] Insulin analogs [4.

6 -1.9 11.8 [-2.com] [11.9%] Cerezyme [0.610 $25.74 PHARMACEUTICAL EXECUTIVE MAY 2010 www.961 $14.1%] [-10.jp] $7.3 [-10.7 $6. Belgium [ucb.416 $17.0 13.4%] TOP GLOBAL THERAPEUTIC CLASSES. Other key mergers during the period include Sanofi Synthelabo with Aventis.3] UCB Brussels.com] $4.372 $35.2%] * $1605 $1724 $940 $917 $275 Aricept [3. Glaxo Wellcome with SmithKline Beecham.8%] [5.3 -4.6 11.6 7.pharmexec.8 $7.1%] * N/A $599 $856 $751 $966 N/A Tamiflu [0.com] Baxter International Deerfield.6 $4.209 $23.jp] Genzyme Cambridge.5] Generics [N/A] Merck KGaA Darmstadt.995 -19.174 $10.604 $13.1 % Growth from 2008 8. .806 4.4 0.5 $5. and Roche with Genentech. Illinois [baxter.com] $4.7%] [0.com 21 [24] 22 [23] 23 [28] 24 [26] 25 [29] Therapeutic Class Eisai Tokyo. Inhibitors HIV Antivirals Anti-epileptics Narcotic analgesics Non-narcotic analgesics Eythropoietins Mergers have been a clear part of the growth strategy of the top ten pharmas.co.406 $29. Japan [eisai.8 [8.8 TEN YEARS OF THE 2010 TOP 10 50 45 Prescription drug revenue in billions of USD 40 35 30 25 20 15 10 5 0 Pfizer Aventis Novartis GSK Roche AstraZeneca Merck J&J Lilly BMS 26 [27] 27 [35] 28 [31] 29 [34] 30 [30] Servier Neuilly-sur-Seine [servier.3 18. Massachusetts [genzyme.2] Truvada [2.6 $4.235 $11. Easily visible in the chart below are Pfizer’s mergers with Warner Lambert (completed in 2000.5 4. 2009 2009 Sales (US$M) $52.8 $11.9%] [23.1 $3.9 8.6%] Remicade [0.com] Mylan Canonsburg. California [gilead. Novartis with Chiron. Germany [merck.com] SOURCE: IMS Health Oncologics Lipid Regulators Respiratory Agents Antidiabetics Anti-ulcerants Antiotensin II Antagonists Antipsychotics Antidepressants AutoImmune agents Platelet Aggr.4] Keppra [1.de] Gilead Sciences Foster City.8] Mitsubishi Tanabe Osaka.0 9.281 $33.2] Rebif [2.9 $3.5] Advate [1. Pennsylvania [mylan.596 $30.8] Chugai Tokyo.0 14.758 $12. Japan [chugai-pharm.jp] [9.248 $19. with results appearing in the 2001 Pharm Exec 50) and Pharmacia (with revenue jumping up in 2005). Japan [mt-pharma.co.8%] [26.co.

Italy [menarini.com] Apotex North York. (This chart omits several minor mergers. Massachusetts [biogenidec.com] [-3. Eli LIlly 2009 pro forma Bristol-Myers Squibb 2009 actuals 0.5] Alcon Hünenberg.0 40.8%] [3.pharmexec.7 $2. 2008. Merck jumps from seventh place to fourth.0 10.1] Generics [N/A] Cipralex/Lexapro [1.6 [9.com.2 $2.au] $3. Ireland [shire.9%] * $251 $706 $661 N/A $285 Gardasil [0.6 $3. This chart shows the impact recent and recently announced mergers would have had on the top ten if they’d taken place January 1.com] [16. California [allergan.com] Forest New York.5 THE TOP TEN POST-MERGER Pfizer + Wyeth Sanofi-Aventis Novartis + Alcon Merck + Schering-Plough GlaxoSmithKline + Stiefel Roche + Genentech AstraZeneca Major mergers are reshaping the top ten.6%] $1283 $638 $665 Avonex [2.6] Glaucoma products [1.3] N/A Pantaprazole [N/A] Allergan Irvine.) Even without additional mergers.3] Lexapro [2.0 20.7 $3. Denmark [lundbeck.0 36 [42] 37 [43] 38 [44] 39 40 [45] Biogen Idec Cambridge. Australia [csl.3] Shire Dublin. Switzerland [alcon.7 $3.3%] N/A $615 Lundbeck Copenhagen.com] [23. Pfizer leaps forward.76 PHARMACEUTICAL EXECUTIVE MAY 2010 www.com 31 [38] 32 [36] 33 [37] 34 [41] 35 [40] CSL Victoria. Ontario [apotex.1%] [0.9%] Nycomed Zurich. New York [frx.com] $3.4%] [5. Pharma’s Top Six should all have revenues of $40 billion and up.com] [74.6 [12.0 50.6 $2.1] Botox [1.0 30.0%] * Adderall [0.7 $2. Switzerland $3.5%] SOURCE: Oliver Wyman Johnson & Johnson . Roche (which reported a full year of Genentech revenue) moves from eighth place in 2009 to sixth.com] Menarini Florence.3%] [3.0 70.0 60.

com The Top 10: The Year In Review Pfizer Acquired Wyeth in $68 billion Roche Completed $47 billion acquisi. and Japan. an oral medication for renal cell cancer.pharmexec. inflammation. Kendricks (Mexico). Novartis Joe Jimenez appointed new CEO. struck ground-breaking. a contract manufacturer of biologics. Completed acquisition of Cougar. including a partnership with Tekmira Pharmaceuticals to bring Roche’s first RNA interference products into human testing. injectable anti-TNF drug for rheumatoid arthritis. Eli Lilly Launched translational medicine unit and opened new biotech center in San Diego. Launched Multaq. Created regenerative medicine unit. Announced purchase of Chattanooga-based OTC company Chattem for $1. Launched Iressa for non-small cell lung cancer in the EU after having withdrawn its application in 2005 Divested portfolio of over-the-counter products. . Sanofi-Aventis Multiple acquisitions of generics companies including Medley (Brazil’s largest). much-discussed deal with the health insurer Cigna over diabetes drugs Januvia and Janumet. Onglyza (a drug for Type II diabetes. tion of Genentech. Filings include Benlysta. Signed 51 new research/technology deals. Announced acquisition of infection-research company Novexel and expanded anti-infective partnership with Forest. French maker of nutritional beauty supplements. Acquired Elan’s rights and assets in the Alzheimer’s Immunotherapy Program. 145 projects in clinical development. Actemra/ RoActemra for rheumatoid arthritis approved in EU (and in January 2010 in the US). Acquired Stiefel. With Pfizer created ViiV. Acquired Oenobrol. Adler Biopharmaceuticals. Launched Nucynta. providing bigger discounts to the plan for achieving better patient results. Launched biosimilars in Japan and Canada. potentially the first new drug for lupus in more than 60 years. a biotech focused on fully human monoclonal antibody drugs for cancer. Divested itself of its stake in Merial. anti-arrhythmia drug. Simponi. Adcirca (with the same active ingredient as Cialis— tadalafil) approved for pulmonary arterial hypertension in the US. Ilaris (cryopyrin-associated periodic syndromes). and Canada. In April. developed and marketed with AstraZeneca) approved. and Canada. in US. Teijin Pharma. a novel oral drug for chronic pain. Announced acquisition of Avecia. Onbrez Breezhaler (EU.Johnson & Johnson deal. Merck Merged with Schering-Plough in $41 billion deal.9 billion. Divested holdings in Mead Johnson Nutrition. giving company entrée to the vaccines and (again) consumer products markets. Valturna (hypertension). a specialty dermatology company with revenues of $900 million. for COPD). completing a transition toward pureplay pharma. an antiplatelet agent co-developed with Daiichi-Sankyo. Entered partnerships with ZymoGenetics. a monthly. 133 R&D programs. Prevnar 13 approved in 40 countries. GlaxoSmithKline Product approvals include Votrient. and significantly boosted licensing partnerships. EU.78 PHARMACEUTICAL EXECUTIVE MAY 2010 www. EU. Co-promotion deal with Kowa for the statin Livalo. Launched Arzerra (for refractory chronic leukocytic leukemia) in the US. approved in the US. a joint venture with Wyeth. Nissan Chemical Industries. and infection. autoimmune diseases. Fifty-nine new molecular entities in clinical testing. and Zentiva (Czech republic). Submitted US NDA for ticagrelor (tentatively to be known as Brilinta) an oral antiplatelet treatment. Bristol-Myers Squibb Acquired the shares it did not already own of Medarex. Acquired EBEWE Pharma’s specialty generics business. an animal health joint venture with Sanofi-Aventis. EU. Launched Toviaz for overactive bladder in the US. co-developed with Gruenenthal. approved in the US. including eight in Phase III/registration. specialty company dedicated to HIV. Phase I through registration. a biotech with a Phase III drug for metastatic prostate cancer. Effient. AstraZeneca Launched Onglyza (for diabetes) in the US & EU. Approvals include Afinitor (for renal cell cancer).

1 $2.pharmexec.236 $8.8] Generics [N/A] Crestor [0.com] Shionogi Osaka.6 $2. while the top 20 were responsible for about 80 percent of sales.2 $2.jp] Meda Solna.4] Astelin [0.0 25.com.1 billion in 2008 Revenue continues to be concentrated in the largest companies.5 billion That compares with 48 mergers & acquisitions worth $51.8 $1.jp] Kyowa Hakko Kirin Tokyo.com] Watson Corona.4 $2.co. Pennsylvania [cephalon.2] Ratiopharm Ulm.com TOP 15 GLOBAL PRODUCTS.co.0 5.032 $5.0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 Ranking 41 42 [33] 43 [47] 44 [46] 45 [48] 46 [49] 47 [50] 48 49 50 Celgene Summit.0 Prescription drug revenue in billions of USD 40.4%] [13.0 10.com] $2. Japan [ds-pharma.7%] [55.com] Cephalon Frazer. there were 29 mergers & acquisitions in the pharmaceutical industry SOURCE: IMS Health worth $126.8 $1.863 $5.986 $4.0 30.se] SOURCE: Oliver Wyman .673 $4.0 15.0 35. Japan [shionogi.2%] [1.012 $5. THE TOP 50 50.100 $8.9%] * [-0.jp] Hospira Lake Forest. Illinois [hospira.7%] [34. California [watson.2%] [15.099 $6.357 $5.7] Generics [N/A] Provigil [1.0 0.3%] $471 N/A $395 $543 $241 $197 N/A $543 $497 N/A Revlimid [1. New Jersey [celgene.80 PHARMACEUTICAL EXECUTIVE MAY 2010 www. the Top 10 accounted for just under 60 percent of revenue.0 $1.681 $4.com] Dainippon Sumitomo Osaka.288 $9.0 20. Sweden [meda. 2009 Product 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Lipitor Plavix Nexium Seretide Seroquel Enbrel Remicade Crestor Zyprexa Humira Avastin Singulair Mabithera Abilify Lovenox 2009 Sales (US$M) $13. Germany [ratiopharm. Japan [kyowa-kirin.383 $5. Iceland [actavis. In this year’s Top 50.1 $2.6] N/A CNS generics [0.015 $4.0] Amlodin [0.1%] [0.7 [20.2] Espo/Nesp [0.572 In 2009.0 45. REVENUE DISTRIBUTION.2%] [13.7 $1.453 $5.com] Actavis Hafnarfjörður.1%] [-35.

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