Pfizer plays gin rummy
Oligopolies collect brands like gin rummy players collect good cards; they want to put together the right combination of winners in the right categories. But they also discard brands, which get pricked up by other players. (Actually, they act more like players in the old-fashioned gin-related game of canasta, where players can hold as many cards as theycan pick up.)
The discards come from two reasons: a product doesn't fit into the strategy of the oligopoly, or a merger when regulators demand that brands/products be spun off to maintain some level of competition in specific categories or subcategories. Their discards are usually picked up by another oligopoly.
That's the case with the recent Pfizer/Pharmacia merger (see our entry for
April 16). Regulators in the U.S. and Europe demanded that the company
release 12 products before the merger, products that would threaten
competition in a specific subcategory. Altogether, this is nothing to the
hundreds of brands the companies owns, and the products make up around 1%.of the total income of the merged company. However, some drugs still in testing show promise to become big sellers when released.
Here are a few of the products:
- Pfizer's Halls' cough drops -- competes with Pharmacia's Ludens brand;sold to Cadbury-Schweppes
- Pharmacia's Cortaid skin cream -- competes with Pzifer's Cortisone; sold to Johnson & Johnson
- Pfizer's Bonine motion sickness drug -- competes with Pharmacia's
Dramamine; sold to Insight Pharmaceuticals
- Pfizer's Femhrt hormone replacement drug -- competes with Pharmacia's Activella; sold to Galen Holdings Ltd.
- Pharmacia's migraine drug Axert -- competes with Pzifer's Relpax; rights sold to Johnson & Johnson
- Pharmacia's impotence drugs (not yet released) -- compete with Pzifer's Viagra; one sold to Neurocrine Biosciences, the other returned to licensorNastech
Other products include animal antibiotics, a bladder control drug, and an antihypertensive.
Normally, the regulators were out to keep two companies from dominating any subcategory. They were happy, however, to have three competitors. Note that many of the buyers were well-established multinational oligopolies, the only kinds of companies that can market most of these products worldwide. To the general public, who doesn't associate specific companies with any of these products, these reshufflings of the deck go unnoticed.
5:25:26 PM 
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