Pfizer Industry Review

4318 Words Apr 14th, 2008 18 Pages
Pfizer Corporation: The pharmaceutical industry began in the early 1800’s when several chemical companies were founded in Philadelphia, marking the beginning of our current pharmaceutical manufacturing industry (Pfizer, 2008a). Founded in 1849, Pfizer has grown into a multibillion-dollar corporation by providing many of the highest quality drugs available today (Pfizer, 2007). However, many factors impact the continued success of Pfizer and the pharmaceutical industry in general. After reviewing these factors, it is our recommendation that Pfizer focus on short-term consolidation and long-term global expansion into emerging markets while focusing research and development efforts in the biotech sector.
Market Structure Since the 1950s,
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Pfizer is also trying to come up with new ways to hold onto revenue that is lost to generic producers once patents have expired. Pfizer is advocating to create a new category of prescription drugs called authorized generics in which “the original manufacturer licenses exact copies of its branded drug to a generic manufacturer” in exchange for keeping some of the revenue (Business Week, 2008, para. 4). In order to fight off generic competition, Pfizer has to advertise to differentiate its products.
Pfizer has become interested and is investing in biotechnology not only because of the patent potential, but also because the biologic compounds are significantly harder to copy by generic manufacturers (Lawler, 2007). Pfizer’s billions of dollars dedicated to research and development have been fueled by the search to be the first to patent a new blockbuster drug. The discovery of a blockbuster drug can make or break a company. In response to competition going global, Pfizer has done the same only to be forced to face problems with both counterfeiting and the protection of intellectual property (Kermani, 2006). Overall, Pfizer has been affected by global competition in numerous ways, and most of the actions Pfizer has taken as a result have made the company more profitable as a whole.
Supply and Demand In the pharmaceutical industry, supply and demand is complicated by regulatory
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