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Analysis of Pfizer Company Name Course code Institution Date of submission

This sparked a fresh wave of consolidation in the industry.2 Analysis of Pfizer Company Introduction The pharmaceutical industry has gone through a lot of evolution. a key drug which was supposed to replace the Lipitor had failed terribly during its late stage clinical testing. This paper seeks to critically analyze the company in terms of its business strategy and performance as well as suggest recommendations which will help the company prosper in the challenging economic market (The Washington Post. the industry continued to experience an increasing hostile environment and a decline in R&D productivity which led to waves of job losses (US Census Beruae. with its annual revenue approximated at 13 billion USD. However in the year 2011. This made investors in the company to start . 2005) About Pfizer Company Pfizer Company is the world’s largest pharmaceutical company. it is usually faced with an unusual strategic environment which has raised great concern to industrialists in this sector. However with these factors still in mind. the drug faced a patent expiry which led to dramatic losses in sales value. Payers and regulators have drawn attention to environmental pressures and consequently discussing the key forces which are currently driving the industry. Its main product which has led to its remarkable revenues and contributes to almost a third of the company’s turnover is the block-buster cholesterol lowering drug Lipitor. 2008). however. The issues found included. An instance of such a company which was affected in the pharmaceutical industry is the Pfizer Company. addressing unmet medical needs. Additionally. the importance of innovation and time to the market and lastly globalization.

Overview of the pharmaceutical industry The pharmaceutical company can be characterized by factors such as highly risky. governmental regulations which are stringent and purchaser pressures which are powerful. In order to find out what needed to be done. weaknesses (these are internal factors) and Opportunities and threats (these are external factors) which might be facing a company. SWOT analysis is important since it offers information which aids a company to match its capabilities and resources in the competitive environment which it exist. AstraZeneca and Glaxosmithkline(Manhattan Institute For policy research.2008). Pfizer. The three main competitors in the market are. Therefore it massively contributes to the process of strategic planning in an organization and can be used in the business development process and management as a dynamic part (Albert. Establishment of new drugs is usually costly and timely and most of the drugs fail in terms of verification and returns.3 loosing hope in the company. SWOT Analysis of Pfizer Company SWOT analysis is an analytic method which is employed in the categorization and identification of important internal and external factors which are mostly faced by an organization. the industry is usually subjected to monopsony meaning the government is the powerful and effective purchaser. lengthy R&D(development) processes and researches. despite the fact that there was nothing wrong with the R&D activities and the balance sheets. The acronym for SWOT means strength. stiff competition in terms of intellectual property. In a number of countries. However. . something was a miss in the company. 2005). this paper seeks to strategically analyze the company’s position and make any necessary recommendations.

4 Strengths         Well established Brand Company Ranked in Position one in the global pharmaceutical indusrty It has a lot of revenues Use of vaccine as a key revenue generator Sales and marketing are well established Lipitor as the world’s best drug Strong balance sheet Broad pipeline of new drugs Weaknesses     Lack of a well established strategic plan Innovation process is not reinvented Timely and costly drug innovation process A lot of failed drugs which lead to loss of investors Opportunities    Acquisition of Monsanto(Warner-Lmabert) and Pharmacia Large emerging markets in the pharmaceutical industry Innovations in the pharmaceutical industry Threats .

There are three principles that according to Porter are essential in establishing and maintaining a strategic position in the market (Porter. and the winning strategy for Pfizer Company. In the case of Pfizer the target market has already been identified. they are four times likely to depend on drugs compared to the smaller generation. Strategic analysis for Pfizer Pharmaceuticals This section seeks to analyze the strategic position. strategic options. This is due to the increase in chronic disease that is affecting the aged population especially obesity. the target market must be clearly identified (Porter. 1988). The cost leadership strategy is also another principle that has been identified that enables an organization to be strategic position (Murray. In addition to that necessary recommendations in regards to the strategic analysis of the company will be analyzed. According to Porter. 1980). 1980). For Pfizer pharmaceuticals. the ageing population forms their biggest part of consumers. This is because majority of the people who are over sixty five years old are more likely to suffer from healthcare compared to the young people.5        Well established competitors such as AstraZeneca and Glaxosmithkline Governmental controls and regulators Reduction of productivity by mergers Governmental and media Efforts to reduce spiral healthcare costs Low priced generics in the industry Overall damaged reputation of the pharmaceutical company by some companies Reduced R&D production in the pharmaceutical industry. in understanding the strategic position of an organization. In fact. The cost leadership strategy mainly relies .

by Pfizer creating a large output. this means that they will be unable to match the low cost of production as well as the low price that they are already experiencing in the market. This can be achieved by having the lowest price in the market compared to the selling price of other organizations. 1983). they will create an entry barrier for other pharmaceuticals who want to produce the same drug since they might be unable to achieve the standard of output that has already been set in the market. One of the ways that an organization can achieve this is by purchasing the materials that they need in bulk in order to enjoy discounts. 1990).. By minimizing the cost of production. 1987). By producing large output of drugs. this can be achieved by producing large volumes of medicine. they can create competitive bidding contracts in which the lowest bidder will be picked for their products. in obtaining cost leadership strategy. There are various ways that have been identified that can assist an organization in meeting cost leadership strategy. The first tactic that is to be used is to attain a high asset turnover (Hambrick. Lastly. if their competitors are unable to produce such mass of outputs. This is . Moreover. This is because majority of the patients prefer generic drugs because they are cheap and readily available in the market. another way that Pfizer can achieve in creating low cost products is by producing generic drugs in order to cut on the production costs. this means that Pfizer will be able to use fixed costs since it is spread over a large concentration of output. For an organization like Plitzer. an organization should also learn how to control and manage its supply and chain in order to achieve low cost production (Wright. the organization can offer cheap products to their consumers (Wright et al. Moreover. In the case of Pfizer pharmaceuticals.6 on the organization being cost sensitive to its consumers. Moreover.

this is a good way of strategic positioning itself due to the fact that the market is saturated (Miller. The focus strategy lets organization to choose what market they want to venture in to (William. By producing generic drugs. A patient only turned to patent drugs when their generic drugs failed in which it was a rare case. Therefore. the pharmaceutical industry mainly focuses on the differentiation strategy. In the case of the pharmaceutical market. Therefore. Lastly. majority of the industries are coming up with unique strategies. Majority Of the companies in the pharmaceutical industry have the need . Plitzer can use the focus strategy. some companies have introduced the disease management initiatives where majority of the patients are sensitized on the goals of a healthcare and how they can provide themselves with cheaper alternatives at home by treating themselves. the number of patented drugs is decreasing due to the small number of people who purchase them. it has been found out that the cost of R& D activities is too high in which this does not guarantee success of the drug that is been tested. this means that the organization will be able to grow and establish itself in the market. while the number of generic drugs is growing.7 especially true for patients who were mostly suffering from asthma and depression. an organization can decide to venture in to an already saturated market or a new market. Moreover. In the case of Pfizer. The key strategic capabilities of majority of these pharmaceutical companies are sales and marketing and R & D. 1979). For instance. it is well known that diabetes is on the rise for majority of the citizens in the UK. Moreover. in establishing a strategic position in the pharmaceutical market. it is advisable for Pfizer pharmaceuticals to venture in to the already saturate market. in creating a strategic positioning in the market. For instance. 1992). For instance in the case of diabetes.

Vaccines have also proved to be revenue generated. It is well known that the GDP is boosted by the pharmaceutical industry. the ageing population would no afford brand drugs and therefore turned to generic drugs. For majority of the organizations. Generic manufacturing industries have grown rapidly in the market. Therefore. majority of the organizations who produce generic drugs would be safe regardless of whether the economic recession hits hard or not. This is because the success rate of vaccines is very and more so because the vaccine is hard to be created for generics. The 1997 direct to consumer advertisement transformed the pharmaceutical industry although the cost of providing such benefits to employees increased immensely. This is because they have accounted for more than half percent of the drugs being sold.8 to restructure their manufacturing and production sites. An instance case is GlaxoSmithKline. This is because the drugs are cost friendly. Moreover. due to the recent recession in the industry. In the pharmaceutical world. . With entry barriers being high. This is majorly contributed by the selling of generic products. branded products have been displaced out of the market with the rise of generic products. Moreover. However. There were other certain factors that have fuelled the increase in growth of the pharmaceutical industry. there is need for specialized workers who are capable of handling large and complex trials at a higher success rates. over the counter medicines have proved to be of great importance. This is because generic products are cost friendly. joining forces with local companies offers a great insight in how to venture in to the market. for organizations who want to internationalize. For generic manufacturing industries the two sectors that are needed for efficiency in the company is the manufacturing and distribution centre.

pharmaceutical organizations with high levels of R & D are likely to become key leaders in the market. other pharmaceutical companies have reorganized their R & D to create smaller units which were much more affordable and to better manage them. A pharmaceutical industry which was in a position to create strong global market maximized its . This is because the development time of such drugs is lengthening with time and the productivity of the R & D has proved to be costly. Therefore. Majority of the drugs have failed on their last trials thus causing the organization billions of shillings. it is important for organizations which want to place themselves strategically in the market to have strong R & D developments. majority of the organizations have resorted to become both creative and efficient. by also producing cheaper products compared to your competitors. sales and marketing has become an important strategy. the blockbuster drugs were genuine drugs that as a result of deep R & D penetrated deeply and largely in the market. the annual sales was likely to rise due to the way it was marketed globally. the organization will be in a position to flourish in the new set environment due to its cheap products. In addition to that. For instance. For the pharmaceutical companies. Moreover. other companies resulted to cost-sharing which proved to be less expensive for majority of the organizations. Consequently. A blockbuster drug was a drug that offered a solution to a common disease that proved to be a headache.9 Moreover. for pharmaceutical organizations which want to create a competitive advantage. To tackle this issue. It should be also noted that blockbuster drugs were few and far. they have mainly focused on a specific area exiting the whole area in order to concentrate on a specific drug. One company that benefited greatly from the blockbuster drugs is the Glaxo pharmaceuticals went from being a small player in the market to a huge competitor. By the drug being efficacy and tolerable. Moreover. This is the only way that has been seen to contribute to success.

These are the ones who are interested in solving the organizational problem and will benefit from the project through its activities. these includes the issues and problems being solved by a number of projects. Project objectives. this is the main aim of the project. Project goal. new advertising methods were necessary. Development problem.of Pfizer Jeff Kindler. The main components of SAF include. Main problems. The objective of the company was to make amendments in Pfizer so that it could prosper . Stakeholders. it addresses what the aims of the project need to accomplish in terms of the major problems addressed. SAF Test Situation analysis framework (SAF) is a method used for analytic and planning purposes.10 profit and was in a better position to attract the best deals in the market. with the advancement of technology. these are the main precise problems being addressed in the project. sometimes referred to as beneficiaries. However. This analysis method is mostly used in terms of helping in the achievement and development of objectives made by an organization. and it is a description of what the project tends to achieve by meeting the development problem. The aim of this project is to keep Pfizer company afloat.SAF is derived from the Logical Framework approach (LAF) and the object oriented project planning (OOPP). A traditional set up is where an organization would go to a doctor and market themselves by offering free samples. The one mainly interested is the CEO.

These included formulation of a well established strategic plan. For Pfizer Company. . a well established strategic plan and need for globalization. there was need for the company to come up with innovation as a key objective of the firm and lastly the company needed to work on globalization as a key factor of keeping the company afloat. sometimes known as root problems and are the major factors behind the main problem. they are an indication of what will be achieved by the communication intervention aims more so in relation to the focal problem and project goal. Communication objectives. All the other components of SAF are derived form it. These included.11 The problem tree. Effects Dramatic loss of sales value Failure of key drug to replace liptor Patent expiry of Liptor Declined R&D productivity Problem Keep Pfizer Company afloat Lack of strategic plan Causes Lack of innovation Lack of globalization Focal problems. lack of innovation. this is a tool which helps in analyzing the causes and effects of a situation.

Formulation of a well established strategic plan. A considerable sum of money and employment of employees who would facilitate the objectives. design specifications. development of affiliate companies for the purpose of globalization. communication approaches and interaction groups. Inputs. it is quite evident that despite the fact that Pfizier Company is a well established and reputable brand in the pharmaceutical industry. hiring of new employees. These included. Development Problem Problem Tree Goal Main Problem Immediate Objectives Focal Problems Outputs Communication Objectives Activities Inputs Communication Mode Design Conclusion In conclusion.12 Communication mode design. the company needs to reconsider its strategic . Activities. these are the resources carried out in terms of resources and money so as to achieve the desired objectives. these are derived from the different modes in communication mode design and are a measurable results of the available activities in the project. these are a sequence of steps in where activities and media. Outputs. A number of the communication approaches are obtained from this communication mode design. where by a number of strategic tools will be applied. these are the actions carried out so as to generate the outputs in the project. The outputs to be included so as to facilitate the success of these projects were. change of strategy in terms of marketing and production. Cost for employment of a Well established strategic plan manager The diagram below shows the linkages used in SAF process.

. a very strong balance sheet and significant amounts of cash. something had to be done so as to keep the company a float.13 planning options. The only way for the company to succeed in the challenging and competitive pharmaceutical industry is through an effective strategic options. This is because even though the company has a broad pipeline of new drugs. plans and recommendations as described above through the use of analytic methods such as SWOT and porters five forces analysis.

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