Pfizer Ltd Company Analysis Report
Pfizer Ltd
Strategic Direction
·
With the sale of Pfizer Inc’s
consumer healthcare division to Johnson & Johnson Inc, the company intends
to focus on its core competencies in prescription medicines. The company also
plans to push further into rural areas of India, with increased promotion and
marketing activities. With the launch of Champix, a smoking cessation drug, in
2008, Pfizer Ltd has signalled its intention to explore niche therapy areas.
Key Facts
Full name of company:
|
Pfizer Ltd
|
Address:
|
Pfizer Centre, Patel Estate, S V
Road, Jogeshwari (West), Mumbai 400102, India
|
Tel:
|
+91 22 6693 2000
|
Fax:
|
+91 22 6693 2444
|
www:
|
www.pfizerindia.com
|
Activities:
|
Consumer healthcare, animal
healthcare and clinical development
|
Source: Euromonitor
International from company reports
Year end November
|
2005
|
2006
|
2007
|
Net sales (Rs billion)
|
6.0
|
6.6
|
6.7
|
Net profit (Rs billion)
|
0.7
|
1.1
|
3.4
|
Source: Company
research
Company Background
·
Incorporated in 1950, Pfizer
Ltd is one of India’s leading pharmaceutical companies, headquartered in
Mumbai, in the state of Maharashtra. It was a 40%-owned subsidiary of US giant
Pfizer Inc prior to 2006.
·
Following the US$90 million
global merger between Pfizer and Warner-Lambert, Pfizer Ltd amalgamated with
Parke-Davis (India) Ltd in 2004. The Supreme Court, paving the way for a smooth
merger of the two entities, dismissed a suit filed by dissenting shareholders
of Parke-Davis.
·
Following the global merger of
Pfizer Inc with Pharmacia in April 2003, Pharmacia Healthcare Ltd was merged
with Pfizer Ltd in India in July 2004.
·
In 2006, Johnson & Johnson
Inc acquired Pfizer Inc’s consumer products division, including OTC healthcare
operations in India, for a total of US$17 billion. Pfizer Inc now plans to
focus on prescription medications, as it seeks to streamline operations. In
2005, prior to the acquisition, Pfizer Inc derived over 65% of its revenues
from its pharmaceuticals division. The company also has a presence in animal
health and clinical development operations.
Production
·
Pfizer Ltd has a manufacturing
plant located at Navi Mumbai, in the Thane district of Maharashtra, built in
1968. The plant is part of Pfizer Global Manufacturing, which is the
manufacturing division of Pfizer Inc. It is a drug production and finishing
plant, which takes in raw materials and converts them into finished packaged
products. The plant, which is accredited with ISO 14001 certification, also
carries out quality control for the various products manufactured.
·
The Thane plant was upgraded
over 2003 and 2004. This saw the addition of facilities such as pharmaceutical
storage and dispensing, granulation, tablet and oral liquid manufacturing,
primary and secondary packaging, partial encapsulation and oral liquid filling.
·
Apart from manufacturing in its
own plants, Pfizer also contracts out production to various third parties.
Competitive Positioning
·
Pfizer Ltd was placed fifth in
India’s OTC healthcare market in 2008, with a value share of almost 5%. The
company is particularly strong in cough remedies, where it led sales with a
value share of 29% in 2008.
·
The company gained share in
2008, having seen a decline following the sale of the consumer products
division. The company benefited from its entry into digestive remedies in 2004,
with its Gelusil antacids and Agarol laxatives. Gelusil remained popular in
antacids in 2008, due its flavoured tablet format and expanded distribution.
·
The company recognises the low
income levels of many Indian consumers and has tailored its packaging
accordingly. For example, while multivitamins are increasingly popular in
India, many people are unable to afford larger packs of these products.
Consequently, Pfizer offers its leading Becosules brand in blister packs of 15
units at a reasonable price. The blister packaging of these products also
enables them to be carried easily in a bag, with busy consumers thus better
able to ensure their daily consumption.
·
Pfizer Ltd is recognised for
its brand-building capabilities in the industry. The company supports its range
with strong marketing across India, with a growing focus on less-developed
towns and cities towards the end of the review period.
·
In February 2008, the company
launched Champix, its global best-selling smoking cessation drug, in India. By
doing this, the company has signalled its intention to foray into niche areas.
However, the brand is priced quite expensively at Rs9,500 for a 12-week course,
thereby confining its sales to only affluent consumers in India.
Product type
|
Value share
|
Rank
|
Cough remedies
|
29.2%
|
1
|
Indigestion and heartburn remedies
|
7.7%
|
4
|
Antacids
|
19.1%
|
2
|
Laxatives
|
7.2%
|
5
|
Medicated skin care
|
1.5%
|
11
|
Medicated shampoos
|
25.0%
|
1
|
Acne treatments
|
1.0%
|
4
|
Vitamins
|
19.1%
|
2
|
Multivitamins
|
31.0%
|
1
|
Dietary supplements
|
1.4%
|
13
|
Mineral supplements
|
4.7%
|
6
|
Standard eye care
|
6.3%
|
5
|
Source: Trade
press (The Economic Times, Business Standard, The Hindu Business Line), company
research, trade interviews, Euromonitor International estimates
