Essay Pfizer Analysis

1388 Words Nov 19th, 2007 6 Pages

Pfizer is the largest American pharmaceutical company and one of the largest pharmaceutical companies in the world. It competes with Merck and Glaxo, and markets such well-known medications as Celebrex and Viagra. However, the pharmaceutical industry as a whole has undergone changes in recent years with significant consolidation taking place and with increased scrutiny regarding the ways in which drugs are developed, tested and marketed. In addition, recent controversies have erupted regarding Merck's drug Vioxx, and Pfizer has been the target of unwanted publicity regarding its painkiller Celebrex. This research considers the strategic position of Pfizer, including its strengths and weaknesses as well
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Possibly the largest threat to Pfizer is not competition, but the overall perceived loss of integrity that the pharmaceutical industry as a whole has faced in recent years. There is increased scrutiny regarding university research, for example, that occurs at institutions that receive financial support from pharmaceutical companies. The highly-publicized cases of Vioxx and even Celebrex have further eroded public confidence in pharmaceutical companies, and the consolidation in the pharmaceutical industry means that a single blockbuster drug is no longer enough to sustain companies for several years. Instead, companies must have several such drugs and a steady stream in the pipeline if they are to thrive (Jarvis, 2004).
Pfizer is actively engaged in cost-cutting, and has set as its goal reducing pretax expenses by as much as $5 billion by 2008. The company has already begun using layoffs as one way to reduce costs; Pfizer currently employs more than 115,000 worldwide. In late 2005, the company announced that it laid off more than 900 workers in the previous three months, but Pfizer will not comment on where those layoffs took place until the layoff program is complete sometime in 2006 (Anderson, 2005). While cost-cutting can be a necessary process through which companies are able to maintain their ability to compete, pharmaceutical companies have a

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