Pfizer Paper

In: Business and Management

Submitted By jchaudet
Words 4411
Pages 18
| Pfizer Stock Report | | Fall 2013 Research Project |

| Pfizer Stock Report | | Fall 2013 Research Project |

Saint Joseph’s University

Contents II. Introduction 2 III. Macroeconomic Review 3 IV. Stock Market Analysis 6 V. Industry Analysis 8 VI. Company Strategic Analysis 10 VII. Company Financial Analysis 12 VIII. Application of Valuation Methodologies 13 IX. Conclusion and Recommendations 15 X. Exhibits 16 A. Exhibit A 17 B. Exhibit A 17 XI. References 18

Introduction

Pfizer, headquartered in New York, NY, is committed to applying science and global resources to improve the health and well-being of individuals of all stages of life. Ian Read, CEO, leads the company through innovation and solid long term performances on the NYSE. Pfizer is also on the London, Euronext and Swiss exchanges. They make every effort to provide everybody with access to affordable, top of the line, safe remedies and health related services to those in need. Some of Pfizer’s most famous products include, Lipitor, Lyrica, Diflucan, Zithromax, Viagra, and Celebrex.
Pfizer is committed to providing sustainable solutions to the biggest health issues in the world by continuously reviewing and updating their products and services to reduce their environmental footprints. The company maintains the highest ethical standards in all that they do such as sales and marketing to research and development. Pfizer, along with all industry players, are forced to comply with many laws regarding patenting, testing, safety, and efficacy.
Pfizer is a leading innovator in the pharmaceutical field that offers a range of products which can make for a higher standard of living for those in need. As a leading innovator, they are even in the works of creating certain medications which could potentially change the way we deal with the most…...

Similar Documents

Pfizer and the Challenges of the Global Pharmaceutical Industry

...Pfizer and the Challenges of the Global Pharmaceutical Industry Case Study Introduction This report is to summarize the results of Pfizer’s challenges on global pharmaceutical industry and analyze driving factors of competition. I briefly give the industry definition describing the scope of the analysis. The paper has the following major goals: 1) To analyze the current situation, major competition challenges and the prospects of the pharmaceutical industry; 2) To assess Pfizer’s position as a major players of the global pharmaceutical industry and make a comparative analysis of other business practices and financial results using the VRIO method; 3) To recommend Kindler opportunities for further strengthening of their positions by conducting Porter 5 forces. Pharmaceutical Industry Overview Historically, the pharmaceutical industry has developed, produced and marketed one of the most profitable and high margin drugs for many years. This industry has gone through substantial changes in the last few decade and pharmaceutical firms face major challenges, including headline-grabbing litigation, imminent patent expirations, new technologies, rising drug development costs, generic drug substitution, international competitors, and complex public policy issues. Competition Challenges and Prospects A firm must develop a product-market diversification strategy otherwise it may face substantial setbacks once the product loses momentum. It’s important...

Words: 582 - Pages: 3

Pfizer

...PFIZER’S POWER:      Pfizer is one of the largest pharmaceutical companies in the world. Their enormous size and well-know products allow Pfizer to control much of the pharmaceutical industry. They base their company on research throughout the world in order to discover and expand new products. Pfizer’s products can increase the quality of life in living with a medical disorder or actually cure the sickness. The company believes it has the tools to lead the way into the next generation of the industry. Growth and pertinent resources will allow Pfizer to bring consumers the opportunity of better health and well-being. They influence health in over 150 countries and strive to enhance the health of humans in underdeveloped countries. Pfizer seeks to achieve these goals by specializing into four separate groups: Pharmaceuticals group, Consumer Healthcare, Global Research and Development and Animal Health Group. (www.pfizer.com) GROUPS: | FUNCTION: | Pharmaceutical | Produce and market pharmaceutical products | Consumer Healthcare | Produce goods to meet consumer demands including both over-the-counter and generics | Global R&D | Scientists research and produce innovative drugs. | Animal Health | Develop and market drugs to help improve the health of animals | PFIZER’S FOUR GROUPS:      1. Pharmaceutical Group: The Pfizer Pharmaceutical Group produces five of the world’s top-selling medicines, and nine are #1 in their therapeutic class in the U.S. market. Eight...

Words: 6215 - Pages: 25

Pfizer

...attainable and appealing. This is where the focus of my learning and goals has taken me, to be able to become an executive or director at a large pharmaceutical company, such as Pfizer or Merck. Nevertheless, much goes into a decision like this when weighing the options of accepting a job in this setting. How do I stand financially at this moment and current income? How would I stand if I were to accept the job offer that I have been offered? Does this company offer advancement for me to attain more prestigious and higher paying jobs? Does this company have a sustainable business model that will allow me to maintain a job for the future? As you can see, all these aspects play a role and that is only the tip of the inquiry. So how does one weigh the options of accepting a job offer knowing the circumstances in which they lie? I believe this process starts with determining the budget you are on at the moment and being able to make changes to changes in the future. I also believe that doing a financial analysis of the company in which you are potentially joining is critical to ensure your job is secure in the future. Under certain circumstances, the option of taking the job offer placed in front of you will be examined and deemed worthy or not as a job that will suffice for the needs of my family and I. Pfizer Consumer Healthcare (PCH) is among the largest over-the-counter (OTC) health care products companies in the world, with a global footprint of operations in more than 90......

Words: 3185 - Pages: 13

Pfizer

...Current policy and strategy of Pfizer Company The Pfizer Company planning to implement the following strategies due to its lost: Strategic priorities of the merger:   Strengthens platforms for improved, consistent and stable earnings growth   (1)   Definitively address revenue loss from the loss of exclusivity from hypertension drug Lipitor; (2)   Forms broad, diversified portfolio of growth drivers; and (3)   Supports continuing progress in establishing a lower, more flexible cost base.   Drives improved performance through flexible business model   (1)   Focused, agile business units; (2)   Backed by resources, scale of global enterprise; and (3)   Significant financial resources available for investment.   Extends global health care leadership   (1)   Human, animal, consumer health; nutritionals; (2)   Primary and specialty care; (3)   Vaccines, biologics and small molecules; and (4)   Developed and emerging markets.   Enhances ability to meet unmet needs of patients, physicians and other customers   (1)   Pipeline portfolio in “invest to win” disease areas; (2)   Enhances scientific, manufacturing and pharmaceutical science capabilities; and (3)   Provides the best opportunities for world class, high performing talent.   In addition, the following strategic points will be followed:   (1)   Become a leader in biologics; (2)   Enter the vaccines market; (3)   Expand and invest to win areas; (4)   Strengthen leadership in emerging markets; ...

Words: 333 - Pages: 2

Pfizer

...pharmaceuticals company Pfizer, realized that a lot of skilled employee time was in effect “wasted” on routine tasks such as using Excel and PowerPoint and doing basic research. The PfizerWorks team managed to do what many consider an impossibility to devise a successful innovation from the bottom up in a big company. It was possible because Mr. Cohen already had years of experience in the company, so he could understand and navigate general company politics. Lone, obsessive geniuses may do well in a garage start-up but, in big companies, to make innovation happen, the manager first needs to embrace both the corporate machine and the people in it. On a personal level, Mr Cohen had a keen grasp of his shortcomings and knew when to recruit different thinkers for his team. He understood the iterative nature of the innovation process, accepting that nothing is perfect in the beginning. As a result, while Mr Cohen did run some personal risks in undertaking such a project in this way, he minimized the risks through a careful management of the various stakeholders and created his dream job as head of PfizerWorks. Discussion question 1. Pfizer is the world’s largest research-based pharmaceuticals firm and also a well known Pharmaceutical company. So their most of the work depends on research, developing Strategies and innovate. They were trying to find a new way of system which makes their Work more effective and efficient. Pfizer......

Words: 582 - Pages: 3

Pfizer

...Patrick James Corporate Finance April 2, 2014 Financial Ratio Analysis: Pfizer *All numbers in 1,000’s Changes in income statement and balance sheet (Pfizer) When we take a look at Pfizer’s income statement over the last decade, we see much fluctuation in total revenues. In 2009, Pfizer bottomed out at $50,000, but peaked 2 years later at $67,425. A similar pattern is seen when we look at the firm’s gross profit. It appears as though Pfizer maximizes their revenue and income when operating income is low, and in years where more money is spent on fixed assets and research and development. In essence, the key to Pfizer’s income statement walls in their promotion mix, and if we were to get a glimpse of that we would be able to explain all of these numbers more accurately. Analysis of ratios When we first look at the liquidity ratio for Pfizer, we see that the firm has increased the percentage of both the quick ratio and current ratio over the 10-year period by roughly 66%, indicating an increase in assets and a decrease in liabilities. The leverage ratios of the firm tell us that Pfizer has accumulated more debt over the last decade however that debt was highest during year 2007, and has decreased by 25% in the last 5 years. The profitability ratio provides us with information that we can use to see that the cost of Pfizer’s goods has increased steadily over the last decade, while the amount of revenue has stayed relatively even. Finally, the activity......

Words: 376 - Pages: 2

Pfizer-Wyeth

...Pfizer – Wyeth Acquisition Abstract The board of Pfizer, the world’s largest drug maker, has agreed to acquire a long-time rival, Wyeth, for $68 billion. The Pfizer-Wyeth merger will create a prescription pharmaceutical company of extraordinary scale. Despite long-term patent and marketing challenges, most industry observers believe Pfizer has little choice but to engage in some type of major acquisition, especially given the recent loss of income on Lipitor. Pfizer needs to reassure its investors that it can get back on track. With having to freeze its dividends, hundreds of layoffs, and stock prices falling, it is imperative to convince the stakeholders that Pfizer will come out of this economic dilemma on top. The acquisition with Wyeth will reduce Pfizer’s negative sales outlook; however, there is only one route to delivering profit growth to investors, and that is by buying growth and cutting costs. Pfizer has announced that it expects to create savings of $4 billion by the third year after closing the acquisition. This is in part due to the 15% reduction in Pfizer-Wyeth’s combined workforce. After the merger, Pfizer will operate through a patient-centric business units in two major areas, biopharmaceuticals and diversified businesses. Its biopharmaceutical business units are emerging markets Where as Pfizer currently has one of the largest sales forces in the industry, Wyeth’s antibiotics and specialty drugs will not require a lot of marketing to......

Words: 604 - Pages: 3

Pfizer Case

...Pfizer, Inc. | | | (million $) |   | 2013 | 2012 | 2011 | (A) Income | 15,716 | 11,242 | 11,481 | (B) Tax expense | 4,306 | 2,221 | 3,621 | (C) Effective Tax Rate=(B/A) | 27.4% | 19.8% | 31.5% | 1. What was the amount of income tax expense (provision for income taxes) for each of the years presented? What was the company’s effective (average) tax rate for each year? How does this rate compare to the statutory U.S. Federal rate? Why is there a difference? Why does the rate vary from year to year? The statutory U.S. Federal rate is 35%. For three years, the effective tax rate has been lower than the statutory U.S. Federal rate. According to Note 5B, Tax Matters: Tax Rate Reconciliation, there are main five reasons why there is a difference between the statutory tax rate and the effective tax rate. 1) Tax settlement and resolution of certain tax positions : Every year Pfizer got a tax benefit resulting from a settlement with the U.S. IRS and various foreign tax authorities. This lowered effective tax rate. 2) Taxation of non-U.S. operations : Jurisdictional location of earning resulted in the reduction of the effective tax rate. Lower tax rates and tax incentives in foreign countries such as Singapore and Puerto Rico reduced effective tax rate. 3) U.S. Healthcare Legislation : The non-deductibility of fee payable to the federal government as a result of the U.S. Healthcare......

Words: 403 - Pages: 2

Pfizer (Pfe) Financial Analysis

...Pfizer (PFE) Financial Analysis for 2012, 2013 and 2014: Ratio Analysis Abstract The following is a list of these ratios, in conjunction with associative details and background to itemize and explicate the overall financial enquiry: Earnings per Share (EPS), which will illustrate current, along with expected, product losses, unfavorable impact and any adverse change in a foreign exchange rate, along with adjustable income attributable to Pfizer and its shareholder's guidance. The next ratio considered would be Profit Margin Ratio, or Net Profit Margin, to characterize the settlement of adjusted income and weakened EPS guidance to reported net income. With the Return on Assets ratio, stakeholders can configure and acquire current, as well as anticipated dividends, all while maintaining sufficient capital to invest successively and increase global shareholder value – which for now, can maintain to support the annual dividend growth, in addition to the accompanied Gross Profit Rate. Together with this, a Return on Common Stockholders’ Equity can be taken into account with regards to commercial and business development opportunities – leading to a direct, shareholder-value enhancement through actual dividends and repurchases. On the other side of the spectrum, Pfizer’s Current and Cash Debt Coverage ratios clarify and expound upon the potential, yet significant, expected adverse events on revenues due to possible loss and expiration of intellectual property and licensing......

Words: 1814 - Pages: 8

Marketing Strategy of Pfizer

...An innovative culture can boost a companies brand value, because consumers associate the company with the latest products. Besides the brand boost, new products can help a company stay competitive in a tough market. If a company has the best product in a segment, they are likely to gain market share in that segment. * Other points to consider: * Lipitor is the first choice of drug for treatment of high cholesterol. * Lipid regulator market will continue to generate high revenues. * Pfizer, leading pharmaceutical company, most profitable * Pfizer has well respected name all over the world and has some of the top research, advertising, financial and marketing talent * Lipitor recommended by American hearth association. * High Cholesterol, which is a common problem across the globe is only likely to increase with rapidly aging population specially in the US and rise in obesity levels. Weaknesses * Co-marketing agreement for pfizer: * Co-marketing agreements can limit Pfizer’s global presence, because it results in reduced revenue and payments to Pfizer's for their drugs. They have to share revenue with other parties. * Reliance on few products: * The reliance of a company on too few products can increase their risk to any one of their big products. Risk can come from government actions, safety concerns, supply problems and output problems. These increased risk cause the cost of capital to increase and the value......

Words: 833 - Pages: 4

Pfizer

...marketing strategy. Criteria depend mainly on nature of market, therefore creating a problem in deciding the actual method. Maslow hierarchy of needs also explains about satisfying the customer needs in a vertical arranged pyramid with primary psychological needs at the bottom step and with self-actualization needs at highest step with safety needs, belonging needs and esteem needs as intermediate steps in the hierarchy. For my research, I have chosen Pfizer and will explain its segmentation process using Lipitor as an example. Pfizer: Pfizer is one of the world’s largest pharmaceutical company with its portfolio including human and biologic, small molecular medicines, vaccines, nutritional and consumer products. It is located in more than 150 countries with it’s headquarter in New York. Pfizer acquired Wyeth in October ’09 for $68 billion. Its main competitors are: [3] a) Merck, b) GlaxoSmithKline, c) Novartis, d) Bristol Myers Squibb e) AstraZeneca. The top selling products of Pfizer are: [4] a) Accupril – treats high blood pressure & heart failure b) Arthrotec- for osteoporosis c) Cardura- for high blood pressure d) Dalacian- for bacterial infections e) Fragmin- for yeast infections f) Cerebryx- treats epilepsy g) Bacitracin- for bacterial infections h) Celebrex- for rheumatoid arthritis i) Lipitor- treat bad cholesterol The animal health segment discovers, develops and......

Words: 1436 - Pages: 6

Pfizer Viagra

...Viagra  was  the  result  of  luck.  This  case  study  explores  the  long  13­year  journey  from  laboratory  to  the  marketplace  and  explores  some  of  the  key  challenges  faced  by  Pfizer;  most  notably,  project  evaluation  considerations,  when  the  available  market  research  evidence  suggests  a  small  market  for  the  product.  And  product  launch  considerations, when impotence is such an unpopular topic that it is almost  impossible  for  advertisers  to  refer  to  it  without  alienating  the  very  con­ sumer base they are trying to reach.  What is Viagra?  Pfizer's Viagra is now part of business folklore in  terms of an example of  a  successful  new  product.  Viagra  is  now  one  of  the  most  recognised  brands  in  the  world;  it  has  become  a  social  icon  with  annuel  sales  in  excess of $1.9  billion.  And  it  has  transformed Pfizer  from  a  medium­sized  pharmaceutical  firm  into  the  world's  leader.  Yet,  Viagra  was  almost  dismissed  during  clinical  trials  as  interesting,  but  not  clinically  or financially  significant.  It  is  true  Viagra  was  something  of  an  accidentel  discovery.  Scientists testing an angina drug found that as a side effect it seemed to  cure impotence in many patients. It did not take long for Pfizer  to decide  to focus on its unexpected bene­fit and to develop the product further as  an antiimpotence drug. The drug was licensed by the US  FDA (Food and ......

Words: 5069 - Pages: 21

Pfizer Stock Analysis

...Pfizer Stock Analysis Pfizer (NYSE: PFE) is involved in the development, manufacturing and marketing of pharmaceutical products. The industry is intensely competitive and there are a few unique characteristics. Pharmaceutical products have long and expensive development periods – upwards of ten years and $100 million depending on the nature of the drug and the scope of the clinical trials process. In order to encourage companies to engage in innovation, companies are given lengthy patent protection for their drugs upon receiving regulatory approval. This allows them to control rates so that they may recover the development cost. A product brought to market is often highly lucrative, so success in the industry depends largely on the firm’s ability to bring product to market and capitalize on the monopoly rates. Pfizer is the world’s largest pharmaceutical firm, with annual sales near $50 billion. After the sale of its consumer health-care division to J&J, prescription drugs now account for more than 90% of sales. Top sellers include cholesterol-lowering Lipitor, Celebrex for arthritis, Viagra for impotence, and Lyrica for epilepsy and some types of neuropathic pain. Recently approved drugs with blockbuster potential include oncology drug Sutent and Chantix for smoking cessation. As most pharmaceutical companies’ in the market, in this type of business it is not simple since there is a lot of research and the development of new drugs in regular basis. Most......

Words: 1245 - Pages: 5

Pfizer to Acquire Protalix

...High-Technology Acquisitions Final Project -Acquisition Proposal: To Acquire: May 2012 Table of Content Executive Summary I A. Purpose I B. Background I C. The Rational for the Acquisition I D. Standalone, Synergy and Premium Valuations II E. Integration Plan II Part 1 - The Rational of the Acquisition 1 1. Pfizer's Strategy 1 1.1. Pfizer Growth Strategy 2 2. Pfizer's Road Map 4 2.1. Pfizer's Acquisitions Rational 4 3. The strategy behind the acquisition 5 3.1. Acquisition Motives 5 3.2. M&A vs. Alliance 5 4. Target Identification 7 4.1. Protalix - an R&D Acquisition 9 5. Synergy Analysis 10 6. Standalone, Synergy and Premium Valuations 12 6.1. Market Value 12 6.2. Trading and Transaction Multiples Valuations 12 6.3. Discounted Cash Flow (DCF) Valuation 14 6.3.1. DCF Methodology and Assumptions 14 6.3.2. Summary of the Standalone and the Synergy DCF Valuation 15 6.4. Premium 16 6.5. Walk-away Price, Net Value Creation and Financial Feasibility 17 Part 2 - The Integration Plan 18 Bibliography 21 APPENDIXES 22 Appendix 1 - Pfizer's Executive Leadership Team 23 Appendix 2 - Pfizer's Organizational Structure Scheme 24 Appendix 3 - Five Forces Analysis for the Pharmaceutical Industry 25 Appendix 4 - Pfizer's PEST Analysis 27 Appendix 5 - Level of Competition Between the Acquirers & the Uniqueness of the Acquired Company 31 Appendix 6 - Acquisition Motives 33 Appendix 7 -......

Words: 10031 - Pages: 41

Pfizer Ethics

...Pfizer: Ethics and Leadership The selection process used by Pfizer to find a successor to CEO William Steere, who had lead the company to the top of the pharmaceutical industry, lacked a system of checks and balances resulting in a power struggle that ultimately led to distrust and the unraveling of Pfizer’s top brass by an outsider . The power struggle that erupted within Pfizer demonstrates how ethical breaches occur under specific conditions and the resulting damage. It is fascinating to observe how the unethical actions of a few individuals can spiral through an entire organization negatively affecting both the companies and their stakeholders. An economic analysis of Pfizer highlights the mismanagement of resources and the ensuing social and financial costs. Pfizer was founded in 1849 by Charles Pfizer and Charles Erhart as a fine chemicals business in Brooklyn New York. In the 1950’s the company changed its focus from fine chemicals into a research based pharmaceutical company. Pfizer’s growth exploded in the 1980’s and 1990’s with the success of drugs like Lipitor and Viagra. Led by William Steere and fueled by profits from Lipitor, Pfizer was entering its glory years. Under Steere Pfizer stock rose to a record high of $49 a share. When Steere took control in 1991 his emphasis for Pfizer was research and development of pharmaceuticals. Pfizer became a benchmark in the pharmaceutical industry and “was ranked among America’s best managed and most admired......

Words: 2173 - Pages: 9