Tyrannosaurus Rx

1
Tyrannosaurus Rx

• Sabrina George
• Sheliah Vink
• Katherine King

2
Company Profile

• Pfizer/Merck

3
Pfizer

• Research-based
• Technology-intensive products
• Three business segments

4
Merck

• Global research-driven
• Broad range of products
• Benefit services

5
Market Info on Pfizer

• Trading at 43 3/16
• Market Capital is 272,674.02 million
• 59.7 of shares held by institutions

6
Market Info on Merck

• Trading at 89 15/16
• Market Capital 206,904.38 million
• 53.8 of shares held by institutions

7
Net Income

• Pfizer-
• 3,179 million (1999)
• Merck-
• 5,891 million (1999)

8
Pfizer vs. Merck

• Two of the worlds drug titans are facing off
  in a war for dominance -- and their strategies
  couldnt be more different. In the end, the
  presidential election may decide who wins.
• Fortune Magazine
• Lee Clifford

9
Pfizer

• American Home Products / Warner Lambert situation
• Overbid AHP by more than 10 billion

10
Partner of Choice

• Pfizer earned this nickname by promoting drugs
  for smaller companies

11
Predator Of Choice

• Pfizer earned this new nickname after the merger
  with Warner-Lambert

12
Mercks Medco Subsidiary

• More than 370 million products delivered yearly
• On-line pharmacy business

13
Merck-Medco

• Contracts from unions, corporations, insurance
  carriers, and HMOs
• Three 80 million high-tech pharmacies

14
Medcos Training

• Sensitivity training for service reps includes
  cotton stuffed in ears, gloves and vaseline on
  glasses.

15
Strategies
16
Pfizers Strategy

• Free-spending, free marketer
• Unregulated healthcare environment

17
Mercks Strategy

• Getting deeper into managed care
• Medicare reform
• far-reaching inescapable HMO

18
Who Will Dominate?
19
Pfizers Competitive Edge

• Marketing machine
• 20,000 sales reps
• Spends 39 of revenue on sales and marketing

20
Mercks Competitive Edge

• Embracing managed care
• Concern for uncovered seniors
• Employee amenities.

21
Making A Deal With The Devil

• Irked independent pharmacists
• Limited distribution of Fosamax
• An equity stake in CVS ProCare
• Medcos Your Plan program

22
Mercks View

• Controlling the means of distribution would be
  a critical advantage in an environment more
  hostile to profits.

23
Pfizers View

• Pfizer is clearly betting that the
• medical environment doesnt change that
  much-that people will continue to pay up for
  drugs.

24
Sales Force
25
Pfizers Sales Force

• 20,000 sales reps
• Each rep averages 459 visits to doctors
• Very aggressive approach

26
Mercks Sales Force

• 11,000 sales reps
• Salespeople are collegial, responsible, and
  less aggressive

27
Political Effects
28
Bush Administration

• Pfizer benefits
• Merck suffers

29
Gore Administration

• Merck profits
• Pfizer takes a dive

30
Conclusion
31
Which one is better?

• Based on election
• Our vote is for Merck

32
Thank You!

• Dont forget to vote