MAN790 Strategic Management

Action Learning Project: Group 19

Rahul Baranwal
(Team Leader)

Amit Deb

Vijay Shetty

This Photo by Unknown Author is licensed under CC BY-NC-ND

Devasis Pati
Pharmaceutical Industry – Analysis & Strategy
Ankur Dubey

MAN790 Strategic Management

Project Group - 19
 Introduction
MISSION
“Our mission is to become the world’s most valued company to patients,
customers, colleagues, investors, business partners, and the communities
where we work and live.”
VISION
“Innovate to bring therapies to patients that significantly
improve their lives”
VALUES
Excellence, Equity and Joy

• Pfizer Inc. is an American multinational pharmaceutical and biotechnology corporation headquartered on 42nd Street in Manhattan, New York City. The
company was established in 1849 in New York by two German entrepreneurs, Charles Pfizer (1824–1906) and his cousin Charles F. Erhart (1821–1891)
• Pfizer develops and produces medicines and vaccines for immunology, oncology, cardiology, endocrinology, and neurology. The company's largest products by
sales are the Pfizer–BioNTech COVID-19 vaccine ($37 billion in 2022 revenues), Nirmatrelvir/ritonavir ($18 billion in 2022 revenues), Apixaban ($6 billion in
2022 revenues), a pneumococcal conjugate vaccine ($6 billion in 2022 revenues), and Palbociclib ($5 billion in 2022 revenues). In 2022, 42% of the company's
revenues came from the United States, 8% from Japan, and 50% from other countries
• Pfizer was a component of the Dow Jones Industrial Average stock market index from 2004 to August 2020. The company ranks 43rd on the Fortune 500 and
43rd on the Forbes Global 2000

MAN790 Strategic Management

Project Group - 19
Challenges faced by Pharmaceutical companies

MAN790 Strategic Management

Project Group - 19
Value Chain models followed by Pharmaceutical Companies

MAN790 Strategic Management

Project Group - 19
Which overall trends can be observed?

Increasing emphasis on specialty drugs

Importance of emerging markets

Rising costs and complexity of drug development

The growing role of technology

Increasing scrutiny of drug pricing

challenges and opportunities

MAN790 Strategic Management

Project Group - 19
Current pharmaceutical trends may add more cost, complexity, and risk,
with these forces compounding one another.

MAN790 Strategic Management

Project Group - 19
 How and why will the profitability of the industry change

Increasing competition:
New medications are constantly being financed, developed, approved and marketed, resulting in significant market growth.
The global pharmaceutical industry continues to grow with Mergers and acquisitions (M&A) are gradually changing the
marketplace and some of the largest pharma companies planned to join forces with other businesses.

In 2021, notable changes in the market have included:

 Abbvie completing the acquisition of Allergan

 Roche completing the repurchase of its shares held
by Novartis
 Merck announcing it is buying Acceleron Pharma
 AstraZeneca acquiring speciality drug maker Alexion

Patent expirations:

 Several of Pfizer’s top-selling products will confront the loss of key U.S. patents beginning in 2025.
 The combined sales for these products contributed more than half of Pfizer’s revenue.
 On the other hand, Pfizer has other products and pipeline programs to offset losses.

MAN790 Strategic Management

Project Group - 19
 How and why will the profitability of the industry change

Regulatory pressures:
The combined efforts of different countries and regulatory bodies, as well as the size of the fines and their gradual ramping up over time, clearly demonstrates the increased risk
pharmaceutical companies are facing today. Several billion dollar fines have been implemented to Pharmaceutical firms for non compliance:

 In 2009, Eli Lily was fined $1.42 billion over the promotion of the antipsychotic drug Zyprexa among elderly populations to treat dementia.
 In 2009, Pfizer was fined $2.3 billion to misbranding the painkiller Bextra to promote its use as a painkiller in dosages that the FDA deemed dangerously high.
 In 2011, Merck agreed to pay almost $1 billion for the illegal promotion of the painkiller Vioxx for the treatment of rheumatoid arthritis when it had not been approved as such.
 In 2013, Johnson & Johnson was fined $2.2 billion to resolve allegations around the drugs Risperdal, Invega and Natrecor.
 In 2014, The European Commission fined €427.7 million to Servier and five generic drug manufacturers for breaches of rules on restrictive agreements aimed at keeping cheaper medicines.

Shift towards value-based pricing & Focus on speciality drugs:

There is a growing trend in the pharmaceutical industry where drugs are priced
based on their effectiveness and the value they provide to patients. While this
could lead to higher prices for some drugs, it could also pressure the
profitability of drugs that are not seen as providing significant value.

MAN790 Strategic Management

Project Group - 19
Strategies for Pfizer to react to industry trends, changes and Challenges.

Increase Investment in R&D Focus on Emerging Markets

Pursue Partnership and

Embrace Technology Acquisitions

Address Drug Pricing Enhance its Pipeline of

Concerns Innovative Therapies

MAN790 Strategic Management

Project Group - 19
 Pfizer’s Position in the pharmaceutical industry

Pfizer’s Position
Pfizer’s R & D Investment over the Years
Ways Pfizer can react to
industry trends and
challenges:

Invest in R & D

Develop Strategic
Partnerships
Acquiring other
Pharma Cos.
Improving Cost
efficiency

MAN790 Strategic Management

Project Group - 19
 Pfizer – Counter Strategy
As a major player in the
pharmaceutical industry, Pfizer
must continually monitor and react
to trends, changes, and challenges
in the industry to remain
competitive. Some ways Pfizer
might react to these factors include:
• Investing in research and development: Pfizer can
invest heavily in research and development to
create new drugs and therapies that address unmet
medical needs and keep up with changing trends in
healthcare.
• Developing strategic partnerships: Pfizer can form
strategic partnerships with other companies in the
industry, as well as with academic institutions and
research organizations, to leverage their expertise
and resources to address emerging challenges.
As a major player in the pharmaceutical
industry, Pfizer must continually monitor
and react to trends, changes, and challenges
in the industry to remain competitive. Some
ways Pfizer might react to these factors
include:
• Acquiring other pharmaceutical companies: Pfizer can acquire other pharmaceutical
companies to expand its product portfolio and diversify its revenue streams. This can help
Pfizer mitigate the risk of patent expirations and competition from generic drugs.
• Expanding into emerging markets: Pfizer can expand its presence in emerging markets by
investing in local infrastructure, forming partnerships with local companies and
governments, and adapting its marketing and distribution strategies to suit local needs.
• Improving cost efficiency: Pfizer can work to improve the efficiency of its operations to
reduce costs and increase profitability. This can include streamlining its supply chain,
improving manufacturing processes, and adopting new technologies to increase productivity.
MAN790 Strategic Management
Project Group - 19
 References

 https://bstrategyhub.com/pfizer-mission-statement-vision-core-values-analysis/
 https://en.wikipedia.org/wiki/Pfizer
 https://services.hbsp.harvard.edu/api/courses/978674/items/W19390-PDF-ENG/sclinks/cb55ad5e930ff39264b319bb67b10
88d
 https://www.mckinsey.com/capabilities/operations/our-insights/emerging-from-disruption-the-future-of-pharma-operations
-strategy

 https://www.proclinical.com/blogs/2022-6/who-are-the-top-10-pharma-companies-in-the-world-2022
 https://www.drugpatentwatch.com/p/applicant/Pfizer
 https://www.citybiz.co/article/151654/heres-a-chart-that-every-pfizer-investor-needs-to-see/
 https://www.lexisnexis.com/blogs/gb/b/compliance-risk-due-diligence/posts/fine-time-for-pharma-why-due-diligence-is-i
mportant

MAN790 Strategic Management

Project Group - 19
MAN790 Strategic Management
Project Group - 19