Pharmaceutical companies

A handful of  pharmaceutical companies dominate the industry and the top ten firms account for a major proportion of the total worldwide sales. Importantly, the ongoing consolidation and future pharmaceutical industry trends will lead to even more revenue concentration. The historic preoccupation with size is a function of the industry dynamics. It takes enormous amounts of money to discover drugs. But that is only one side of the story. Marketing of new drugs is even more capital intensive. The pharmaceutical induustry is all about the willingness and capability to make high investments.  There is no place at the top for small pharmaceutical companies.

Johnson & Johnson

Johnson & Johnson is a global manufacturer of health care products as well as a provider of related health services. In 2003 the company achieved revenues totaling US$41.8 billion, an increase of 15 % on 2002 revenues, which were US$36.3 billion, see table 28 overleaf.

Johnson & Johnson (J&J), the world's largest and most diversified health care products maker, mainly operates in three sectors: pharmaceuticals, medical and diagnostics devices and consumer products.

J&J’s pharma industry division manufactures and markets anti-fungal, anti-infective, cardiovascular, and contraceptive products. The company is also an important player in the fields of pain management and psychotropic therapy. Brands in this segment include ‘Procrit’ (epoetin alpha) for the treatment of anaemia; ‘Sporanox’ (itraconazole) antifungal, ‘Reminyl’ (galantamine HBr) for treating Alzheimer’s disease and ‘Risperdal’ (risperidone) antipsychotic for schizophrenia. J&J’s pharmaceutical products generate almost 50 per cent of overall sales revenues

The company’s medical devices and diagnostics segment includes a broad array products used principally in the professional fields of physicians, nurses, therapists, hospitals, diagnostic laboratories and clinics. Distribution to these and the pharmaceutical major markets is done both directly to health care professionals and indirectly through surgical supply dealers and other dealers. Product lines include surgical implants, instruments, needles and sutures; blood glucose monitoring systems; wound closure devices; endoscopic instruments; orthopaedic products for joint repair and replacement and correcting spinal deformities; contact lenses; clinical chemistry systems; medical devices, including cardiovascular monitoring and vascular access products; intravenous catheters and shunts; coronary and biliary stents. Professional products generate around 35 per cent of the overall sales revenues.

J&J’s consumer products segment develops and markets skin and hair care, sanitary protection, wound care, oral care, baby care and non-prescription drugs. These products are largely available over-the-counter to the general public and distributed either through wholesalers or directly to independent and chain retail outlets. Brands in this segment include ‘Johnson’s’ baby line of products and ‘Band-aid’ brand adhesive bandages; ‘Neutragena’ and ‘Clean & Clear’ skin and hair care products. Consumer products account for less than 20 per cent of group revenues.

AstraZeneca

AstraZeneca is a pharmaceutical company that provides a range of products for the healthcare industry. In fiscal 2003 the company achieved total revenues of US$18,849 million, an increase of 6 per cent on 2002 revenues of US$17,841 million.

AstraZeneca operates in over 100 countries, manufactures in 19 countries and employs some 54,000 people worldwide. It is headquartered in London in the UK.

AstraZeneca was formed in 1999 through the merger of the Swedish pharmaceutical company Astra and the UK company Zeneca. It is now the third largest pharmaceutical company in Europe and fourth in the USA. AstraZeneca invents, develops and commercializes products that are designed to fight disease. Its products are concentrated in the areas of gastrointestinal, cardiovascular, cancer, respiratory, central nervous system, pain control and infection. Within this structure, AstraZeneca builds up teams with scientific, medical, regulatory and customer expertise in each disease area.

AstraZeneca's current range of products includes ‘Prilosec’ (Losec outside the US), used for gastric disorders, ‘Arimidex’ and ‘Nolvadex’, prescribed breast cancer therapies, and ‘Seloken’, the world's leading cardio-selective beta-blocker. Latest additions to the range include ‘Nexium’, an improved treatment for gastric disorders, ‘Symbicort’, an asthma therapy and the recently approved ‘Crestor’, AstraZeneca's statin indicated for the management of primary hypercholesterolaemia, mixed dyslipidaemia, and familial hypercholesterolaemia, as well as ‘Iressa’, the company's aniogenesis inhibiting cancer treatment.

Its flagship gastrointestinal product ‘Prilosec’ was the highest-selling drug globally in 2000 with sales of over $6 billion’s, although Pfizer’s ‘Lipitor’ and Merck & Co.’s ‘Zocor’ products have now overtaken it.

The company also has various new products in the pipeline. These include an oral anti-blood clotting agent for potentially fatal blood clots, ‘Exanta’. Alongside this, a new treatment for lung cancer, ‘Iressa’, is also in development. AstraZeneca also recently gained FDA approval for a new breast cancer drug, ‘Faslodex Injection’. This has been developed for the treatment of hormone receptor positive metastatic breast cancer in postmenopausal women.

In 2002, AstraZeneca invested over US$3 billion in researching and developing new product candidates. In comparison to other large pharmaceutical companies this is a high level of R&D spend, with only Abbott and Eli Lilly exceeding it in terms of the proportion of sales it represents. This highlights the company's commitment to organic growth. Its globally managed research organization has around 10,000 staff at nine sites in the UK, the USA, Sweden, Canada and India. These research sites have a major focus on advanced enabling science and technology methods, such as informatics and genetics.
AstraZeneca has further highlighted its commitment to growth within the European market recently with the announcement that it is increasing its sales force in the top eight EU pharmaceuticals markets by 800 representatives. Meanwhile the USA sales force has not increased in size, but has been restructured to increase its effectiveness. Thus AstraZeneca is investing in its sales force in order to achieve greater potential from its products.

Roche Group

Roche is a leading healthcare company with all uniquely broad spectrum of innovative solutions. For more than a century, Roche has been active in the discovery, development, manufacture and marketing of novel healthcare solutions. Its products and services address prevention, diagnosis and treatment of diseases, thus enhancing well-being and quality of life.  Sales in 2003 were US$23.3 billion.

Roche Bioscience is a pharmaceutical research company primarily engaged in the discovery and early clinical development of innovative new medicines for the treatment of a number of diseases. The company is a division of Syntex LLC, with medicines being developed for the treatment of diseases such as arthritis, asthma and other respiratory diseases.

The company operates through its two business units: the Inflammatory and Viral Diseases business unit and the Neurobiology business unit. The Inflammatory and Viral Diseases business unit is involved in the identification of novel therapeutics for inflammatory and autoimmune diseases, such as arthritis, and respiratory diseases, including asthma and chronic obstructive pulmonary disease.

The unit also endeavors to discover new therapeutics to treat bone disorders, such as osteoarthritis and osteoporosis, while also focusing on viral diseases such as HIV and hepatitis C. The Inflammatory and Viral Diseases unit combines traditional medicinal chemistry with structure-based drug discovery. The unit also leverages its expertise through collaborations with research-based organizations that are skilled in genomics technologies, the characterization of particular molecular targets, and advanced structure-based drug design.

The Neurobiology unit is involved in the development of medicines to treat diseases of the genitourinary therapy area as well as disorders of the central nervous system. Such disorders in the genitorurinary therapy area include stress incontinence, overactive bladder, and benign prostatic hyperplasia. Research in disorders of the central nervous system focuses on serious neuropsychiatric disorders such as depression, anxiety and schizophrenia, as well as Alzheimer’s disease.

The unit employs the tools and techniques of pharmacology, molecular biology, medicinal chemistry, metabolism, pharmacokinetics, pre-clinical safety, pharmaceutical chemistry and chemical services. The cutting-edge technologies utilized include ultra-high throughput screening, parallel synthesis, bioinformatics, robotics, and genomics and proteomics.

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