Pfizer Case

Most of the company’s sales revenue is mainly generated through pharmaceutical products; while animal health products division and corporate division contribute to 8% of the total revenue. In 2009, Pfizer made announced that it was interested in acquiring Wyeth. This move threatened the relationship it had with Eisai, a Japanese pharmaceutical company which manufactures Aricept. It should be noted that Eisai allowed Pfizer to sell Aricept, a major drug used in the treatment of Alzheimer’s disease; therefore, this emerging wrangle meant that the company was on the verge of losing more than $400 in revenues alone. It, therefore, decided to put the matter before the court for the termination of the threat issued by Eisai.

The current equity to asset ratio is: $111148000/$5755600= 1.93, the current fixed costs to total assets ratio is equal to ($8112000/$111148000), 0.072, the long term debt to Total Assets ratio is calculated as:($14531000/$111148000)=0.131, the current inventory turnover ratio for the company is calculated as follows: ($4529000/$111148000)=0.041, while the current break even ratio is achieved when the total revenue is equal to the to the total cost, that is,($48296000/$8112000)= 5.95. It should be noted that all this figures indicate the values, that is, the ratios for the year 2008.

In terms of global campaigning, the company has managed not to only attract potential markets but also to maintain the market it has already controlled. This is indicated clearly by the increase in revenues from international markets year after every year. However, there have been factors which pose as a challenge to this global operation. Factors such as volatile currency fluctuations as well as political instabilities in most of these international markets have contributed in the loss of revenue for the company. In terms of competition, the company faces far too much competitors which are diversified into both large and small industry players altogether. Companies such as Bayer AG and Novartis form the main competitions in both local and international markets as the whole. Novartis constitutes the major competitor in the local industry and frequently comes second in terms of revenue production. It should be noted that Novartis is potentially capable of attracting more investment since it issues a higher amount of dividends per share than Pfizer, and it has also established and developed an extensive human resource base.

The current potential risk which Pfizer faces is placed in its move to acquire the Wyeth Company. The initial risk comes in when Pfizer agrees to take over all of the legal suits facing Wyeth. It also faces the risk of entering unnecessary debt agreements which might bring it down financially. This is portrayed when Pfizer seeks to rise over $20 billion through debt borrowing. Another risk involved in this acquisition lies in the barricades which have been set to protect economies of international markets from unnecessary merging of companies. Policies formulated in most of these international markets prohibit this form of behavior, and, therefore, it will be completely illogical to acquire the company and in turn lose the international markets. For instance, in Jamaica, the company has been banned to conduct any form of business concerning its product because the Jamaican court ceased recognizing the validity of the company’s patent right terming it “expired in the Jamaican market”. However, the company has continued to explore potential markets in a bid to control even more of the market share. For instance, the company entered into partnership with Grammeen Foundation in Bangladesh for the purpose of providing affordable health care to the less fortunate members of the Bangladesh community. The company has also continued to play a vital role in helping the United States society clientele, especially those hit by the recent recession. In 2009, the company moved to help out patients, who lost their respective jobs through recession, by providing free medication. This move was meant to maintain customer loyalty as well as keeping their stock level at par with the demand in the market. The major challenge facing this company involves lawsuits which it has constantly been engaged in by paying so much amount of money to settle legal cases. For instance, $2.5 billion was paid to settle the civil and criminal case levied against it by the government after it had publicly advocated for the use of Bextra arthritis drug without the consent of the same government.

In conclusion, it will be wise to state that the case has portrayed the challenges and the strengths which the company possesses in its desire to become the leading firm in the production of pharmaceuticals at large. The case analysis has been successful in presenting the objectives of the company and the industry in which it operates in at large.