Stratigic Management

Part One

Obtain sales revenues of firms competing in the U .S . pharmaceutical industry beginning 1970 or the earliest year available--record sales revenues by the firm . Include firms headquartered inside and outside the U .S . Using the beginning year as a base , obtain sales revenue for each firm every third year

1 ) Prepare a list of the rankings of the firms for each observation year on the basis of sales volumes

Rank Year

1976 1987 1997 2000 2004

1 Hoescht Merck Merck Pfizer Pfizer

2 Merck Hoescht Glaxo Wellcome

GlaxoSmithKline Johnson Johnson

3 Roche Ciba-Geigy Novartis Merck GlaxoSmithKline

4 American Home Products Bayer Bristol-Myers Squibb AstraZeneca Bayer Group

5 Ciba-Geigy American Home Products Hoescht Bristol-Myers Squibb Roche Group

6 Bristol-Myers Glaxo Pfizer Novartis Novartis AG

7 Pfizer Pfizer American Home Products Johnson Johnson Merck Co

8 Warner-Lambert Sandoz Johnson Johnson Aventis Bristol-Myers Squibb Co

9 Bayer Eli Lilly SmithKline Beecham Pharmacia Abbott Laboratories

10 Sandoz Abbott Roche Abbott AstraZeneca 2 ) What conclusions do you reach as you prepare the list

From the list , it can be inferred that the pharmaceutical industry engages in monopolistic competition , meaning that many producers provide products (and services ) that vary widely . This affirms the industry 's market structure wherein there is much vertical integration (where a company controls or is involved in the whole process of production , from gathering raw materials to finished product distribution , horizontal integration (where a business extends its size and scope , or both Pharmaceutical firms control only a small portion of the market share and no individual player dominates the market . For example , in 1997 Glaxo-Wellcome , already the second largest revenue-earning company in the industry , holds only about 4 .7 of the Part Two

Information about a firm 's strategy or sought-after position should appear in the annual reports . Assess the strategies of the firms during certain time periods as reflected below

Upjohn in the mid-1970s

Pfizer and Marion Laboratories in the mid-1980s

Eli Lilly and Merck in the mid-1990s

Each of these firms was among the sales leaders in the time period noted above

1 ) Note in each case how sales are driven by just a few drugs . Note specifically the key drugs in each case

Upjohn in the mid-1970s

In the 1970s , Upjohn (which was originally known for the "friable " pill was one of the companies that catapulted the benzodiazepine class of drugs (which included Valium , Librium , etc ) into the popular market Upjohn launched Xanax , then touted to be one of the new "wonder drugs and it was used for treating a wide array of ailments including anxiety stress , and various sleep diss . The company then merged with the Swedish-owned pharmaceutical company Pharmacia to form Pharmacia Upjohn , but was shortly bought my Monsanto Pharmaceuticals . In 2003 , the resulting conglomerate was assimilated into Pfizer Pharmaceuticals

Pfizer and Marion Laboratories in the mid-1980s

During the 1980s Pfizer underwent a period of rapid growth which placed it among the top players in the pharmaceutical industry . This success was brought about by the...