Pharmaceutical industry mergers

Due to FDA policies, this was a pivotal point for the pharmaceutical industry and established the onslaught of mergers for the development of enantiopure drugs. 

The largest ten companies represent more than 90% of pharmaceutical sales. During the last 20 years, mergers have continued, and the last few years have seen even further consolidation of the pharmaceutical industry. One analyst reported in the Wall Street... 

The pharmaceutical industry in industrialized countries experienced a high rate of merger and acquisition activity in the 1980s and 1990s. Most of the leading pharmaceutical firms in the OECD countries are the result of one or more horizontal mergers. For example, Pfizer is the combination of Pfizer, Warner-Lambert, and Pharmacia, which included Upjohn (Danzon, Epstein, and Nicholson 2003). 

The pharmaceutical industry has seen even more dramatic changes with mergers ands acquisitions on a mega scale. The origins of the some of the current, largest pharmaceutical companies are shown in Table 13 [1-6]... 

Examples of this are the late nineties phenomenon of divestments, mergers and of take-overs in the oil, chemical and pharmaceutical industries the focus on core competencies and the extensive use of subcontracting/outsourcing. 

Within the pharmaceutical industry itself, the wish of each company s management to see its firm reach what is considered a critical size remained a constant feature as the century came to an end and the new millennium began. It led to new national and transnational mergers. In France, Sanofi (Elf Aquitaine) merged with Synthelabo (L Oreal) and Laboratoires Pierre Fabre with BioMerieux. Elsewhere the Swedish Astra and the British Zeneca combined their operations Pharmacia-Upjohn took control of Monsanto and two giant firms, Glaxo Wellcome and SmithKline Beecham, announced their intention to combine their activities, which would lead to a group with a turnover of 25 billion, exceeded only by Pfizer after its acquisition of Warner Lambert. 

Seven months after that, with the stock down in the 40s, Emma was still holding on to his Merck shares. But it wasn t based on faith so much any more. The price was just too low now—in fact, the entire market was too depressed—to do any selling. With Pfizer s new merger, I think Merck is going to get left behind rather quickly. I don t know what their strategy is. If I was going to buy anything in the pharmaceutical industry. I d buy Pfizer. ... 

Following the Trade Names is - in parentheses - the latest name of the pharmaceutical company that is marketing the drug. Many of the names of the companies have changed from earlier editions of this manual because of acquisitions, mergers, and other factors in the pharmaceutical industry. 

Taggart, World Pharmaceutical Industry, pp. 441 42, has a useful evaluation of strengths and weaknesses of the merger. For postmerger performance, see Stopford, Directory of Multinationals (1992), p. 1242 Hoover s Global250 (1997), pp. 486-487. 

Also, the composition of firms in the pharmaceutical industry changes as mergers and acquisitions alter SIC codes. For example, the acquisition in 1985 of G.D. Searle Company by Monsanto Corporation, a chemical firm, probably caused Searle s spending on R D to be counted in SIC 281 (chemicals) in subsequent years. Because the SIC classifications change with merger and acquisition activity, NSF is probably a less reliable source of industrywide R D growth rates than is PM A. 

The applications of chemistry within biology are so important that many chemistry departments have become departments of chemistry and biochemistry, or departments of biological chemistry, and some offer both chemistry and biochemistry majors. Biochemistry is one of the major growth areas in chemistry. Although mergers in the pharmaceutical industry have eliminated some research laboratories, this contraction has been offset by an expansion of startup biotechnology companies. 

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