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Pfizer Firm’s Strategic Issues and Competitiveness

Pfizer is a legend in the global pharmaceutical industry based on several facts. It started in 1849, and very few players in the industry match its capacity and potential. The organization is an American multinational known for some unique pharmaceutical products with high demands around the world. Old age, for example, allows Pfizer to have one of the highest numbers of pharmaceutical products’ patents. Such (patents) give Pfizer a unique source of competitiveness around the world. Pfizer does well in many countries worldwide, including the U.S., Europe, Japan, China, Russia, Korea, India, and Africa, among other locations. It is expected that as an old player, Pfizer would lack significant competitiveness due to changes in the market. However, the corporation beats the odds and remains highly relevant to date. Signs also show that Pfizer will be a major player in the industry even in the future. All such aspects provide Pfizer as a unique player worth studying. The present work thus covers Pfizer’s strategies and other key issues that serve as the source of competitiveness.

Strategic Profile/Case Analysis Purpose

Pfizer is one of the oldest pharmaceutical organizations around the world, courtesy of its year of incorporation. The organization now approaches two centuries life span, having started in 1849 in the U.S. Many organizations of this age are now history, but Pfizer manages to stand firm. Pfizer is known around the world for specific drugs that the firm produces almost singly. This aspect gives Pfizer noteworthy competitiveness and monopoly in a sector exhibiting an almost cut-throat competition. Several strategies give the business such force to dominate the industry for a century-plus. Having one of the largest patents in the industry is a strategy that offers Pfizer significant control of the sector (Lakdawalla, 2018). Being the sole designer and seller of several outstanding brands gives Pfizer an unmatched ability to compete in the global pharmaceutical industry. Other critical strategies utilized by the company include the operation of one of the best and most reliable R&D departments in the sector and establishing well-structured partnerships (Lakdawalla, 2018). Pfizer still dominates the global pharmaceutical sector to date, thus, making its strategic moves worth analyzing.

Situation Analysis

Environmental Trends

Pfizer operates under a significantly complex situation around the world. Headquartered in New York, the U.S., the company has operations in all continents and major economies around the globe. Such an aspect implies at least two things for the company, the first one being that Pfizer exhibits noteworthy impact from all the forces affecting global markets (Lakdawalla, 2018). Moreover, operating internationally also implies that Pfizer experiences substantial cushioning from different economies if some global locations face economic issues. Pfizer stands out as a highly multifaceted organization, which makes the firm ‘invisible’ to some of the problems eating the other players in the sector.

Segments of Environment


Pfizer manages to stand out in the pharmaceutical industry partly because of its ability to embrace technological innovations. For example, the organization runs with reduced operational costs due to its move to invest in solar energy for most of its subsidiaries around the globe, mainly those located in the tropics. Moreover, Pfizer ensures lean operations throughout its subsidiaries worldwide due to effective technological inventions. The organization is, for instance, among the first adopters of the corporate resources planning (CRP) invention, which works by integrating different units of the organization to promote agility (Bafuma, 2021). Such aspects, coupled with the massive utilization of technology in the business’s R&D division, make Pfizer a highly technology-dependent firm, supporting the business’s competitiveness.


Pfizer serves a wide range of demographic around the world. Such comes from the organization’s presence in many countries on the planet. Pfizer, for example, serves the very wealthy groups of individuals in the U.S., Europe, India, Japan, China, Asia, and Africa. Many wealthy people often relate age and history, in the pharmaceutical sector, with high quality and dependability, according to Gereffi (2017). The lot thus favors Pfizer because of its age and proven ability to innovate genuine and high quality pharmaceutical products, relative to its competitors. The desire to dominate even the emerging economies also gives Pfizer to serves lots of minorities and have-nots. Gereffi (2017) says that the point that some sicknesses now affect all humans, regardless, of social location, gives Pfizer the chance to serve everyone. The company has some of the best drugs for managing specific illnesses in the world.


Only a few pharmaceutical organizations around the world match Pfizer’s economic potential. The company is the ultimate leader in at least two major pharmaceutical lines around the globe. Such domains include the respiratory and infectious diseases market division and the vaccines and consumer healthcare market subdivision. Pfizer dominates about eighty percent of these market segments globally, which gives its noteworthy competitiveness (Johnson, 2021). The company’s centrality in developing an anti-COVID-19 vaccine and a booster drug for the same infection proves this aspect.


Pfizer mainly operates apolitically in the many areas where the organization has operations. In the U.S., for example, Pfizer disconnects itself from politics to avoid the common mistakes that firms leaning on one specific political divides commit (Leinwand et al., 2016). Pfizer’s purpose is to relate well with whatever administration of the day and help people live well. Attaining this goal cushions the company from the many petty politics that adversely affect it due to changing times.


Pfizer operates in a wide sociocultural array around the globe. The company produces drugs for all the people in the world regardless of their underlying social and cultural issues. Nonetheless, Pfizer appreciates the differences in pharmaceutical products’ preferences among diverse cultures in the world (Leinwand et al., 2016). That allows the business to design differentiated drugs and vaccines for the different locations on the globe. The aspect promotes the acceptability and profitability of the organization relative to competitors who cannot attain the objective.


Globally, Pfizer is a highly acknowledged organization that is trusted to produce the best quality of vaccines and drugs for managing some conditions. The company, for example, is the chief producer of several drugs that it owns the patents. Viagra is an essential drug for many people these days around the world. The drug comes primarily from Pfizer, making the firm as globally present as Coca-Cola. The extensive acknowledgment of the firm serves as an upper hand in terms of competitiveness (Lakdawalla, 2018). The point that Pfizer produces and owns the unique drugs and vaccines makes many people and countries trust the organization’s products, which allows them to sell even during poor economic times.


Pfizer exhibits noteworthy physical uniqueness in all the areas where it operates. It is significantly easy for consumers to realize the firm through its physical appearance. The unique branding and floor layouts across all the company’s divisions make it easy for people to notice it (Lakdawalla, 2018). The factors benefit the organization substantially through awareness creation and brand promotion. Utilizing the unique brand image makes it easy for customers to identify the entity’s drugs all over the world with ease.

Industry Attractiveness

Porter’s Five Forces Model

Porter’s five forces analysis provides an excellent platform to understand different markets. It helps organizations identify and understand the factors that affect their profitability. Applying the analysis tool in the global pharmaceutical sector helps in comprehending the level of competition and the various sources of pressure that companies operating in the industry experience (Lakdawalla, 2018). Below is Porter’s analysis for the sector with reference to Pfizer.

The Threat of New Entrants

The global pharmaceutical sector exhibits a significantly high threat of new entrants. Players in the industry compete on issues like innovativeness and global coverage, thus assuming the issue of cost control (Lakdawalla, 2018). The matter, thus, creates a substantial room for new entrants, with appealing pharmaceutical products, to secure loans from venture capitalists to introduce their low-cost and newly researched items (Dogramatzis, 2016). This aspect makes the risk of new entrants in the sector high.

Bargaining Power of Suppliers

Suppliers in the global pharmaceutical industry have moderate bargaining power. That arises from the point that suppliers provide at least two crucial elements to the firms. Drugs are easy to design, and, thus, suppliers providing drug products have significantly low bargaining power. However, suppliers providing pharmaceutical machinery and equipment have a very high bargaining capacity (Dogramatzis, 2016). The point that such machines and equipment require fine designs and high accuracy gives the suppliers the rare bargaining ability. The balance in suppliers’ power thus makes the influence moderate.

Bargaining Power of Buyers

Buyers have reduced or low bargaining power in the global pharmaceutical sector. The point that almost all customers have knowledge about the drugs they use forces everyone, to buy the recommended drug, irrespective of the cost. Governments have the power to control this power but always fail because of the lack of knowledge concerning the products (Dogramatzis, 2016). The issue, thus, leaves consumers with very low bargaining power in the industry.

The Threat of Substitute Products

Pharmaceutical products around the world have no direct substitutes due to the sensitivity of life. The threat of substitute items in the global pharmaceutical sector is, therefore, low. Consumers are afraid of new medications because they may not be aware of their side effects. Thus, they can only replace a specific drug with a similar one from another company. The issue makes substitution within the sector easy but very difficult on the other ground.

Rivalry among Competing Firms

Rivalry is real in the global pharmaceutical sector due to the involvement of many powerful and financially stable players. Revelry in the sector assumes at least two aspects; between regions and among players. The Chinese pharmaceutical sector is the leading region in terms of growth and innovativeness, followed by the American region (Jörn, 2016). However, Pfizer is the ultimate market leader on the grounds of organizational rivalry. Pfizer’s fifty-four billion-dollar value is way beyond that of Roche, Sanofi, Johnson & Johnson, Novartis, Merch, and GSK, among other players (Jörn, 2016). The fact thus shows Pfizer as the real market leader in the sector where competitive rivalry is very high.

Primary Competitors

The primary competitors for Pfizer are Roche, Sanofi, Johnson & Johnson, AstraZeneca, Novartis, Merch, Amgen, Abbvie, and GSK. The competitors rival each other based on market control and revenue size. Pfizer is the chief leader in the sector with about sixty billion dollars revenue. Roche, Johnson & Johnson, and Merch are very close competitors, with revenues amounting to forty-six, forty-one, and forty billion dollars, respectively (Ellis, 2019). The competitors use innovation, product diversity, global presence, and price competition to challenge each other. Patents also play a major role in determining competitiveness in the sector (Jauquet, 2019). Pfizer’s many patents, for example, contribute significantly to the entity’s dominance in the sector.

Internal Organization

Value Chain Analysis

Value chain analysis helps organizations to identify additional or alternative conceivable sources of competitive advantage. The analysis looks at things like an organization’s supply-chain administration, operations, distribution, marketing and sales, and follow-up services (Wielka Brytania, 2017). As such, Pfizer’s value chain analysis shows the firm to have a robust supply-chain management strategy that supports its international operations effectively (Jörn, 2016). Pfizer embraces the centralized management structure, where ideas from the U.S.-based headquarters to the subsidiaries in different parts of the world. The organization uses the structure to promote uniformity and control over all the pharmaceutical industry’s sensitive issues (Jauquet, 2019). Pfizer further utilizes a wide range of channels to make sales. Such channels include hospitals, wholesalers, distributors, clinics, and several other platforms. The distribution line choice helps the firm realize significant success relative to the competitors (Leinwand et al., 2016). The use of CRP software also allows Pfizer to run highly integrated operations and processes that make follow-up services efficient and timely (Jauquet, 2019). The organization’s outstanding value chain serves as a critical source of competitiveness in the sector.

SWOT Analysis

Environmental Opportunities and Threats

Pfizer exhibits both opportunities and threats like any other business establishment. The ability to expand into new markets, strengthen the R&D department, adopt more technological aspects, and acquire new firms to increase dominance are examples of the entity’s opportunities (Jauquet, 2019). Nonetheless, Pfizer’s expiring patents exist as some of the most critical threats for the firm. The organization’s Viagra patent, for example, expired in 2020, exposing the organization to noteworthy market issues (Lee, 2017). The risk of entering into lawsuits and spending lots of money on the issue also forms a crucial threat for the firm as it tries to defend the expiring patents.

Firms Strengths and Weaknesses

Operating one of the most robust and innovative R&D divisions, having unmatched brand recognition around the world, and exhibiting stable financial condition constitute Pfizer’s strengths. The organization is also significantly old and has many patents that protect its products and formulas from competitors (Jauquet, 2019). Nonetheless, the inability to prevent the potential expiry of its patents and their utilization by competitors makes the firm substantially weak (Dogramatzis, 2016). Pfizer needs to adopt the correct strategies to manage its weaknesses.

Strategy Formulation

Strategic Alternatives

Pfizer operates with integrated cost leadership and differentiation strategy. Combining the two strategies is meant to promote both innovation and revenue growth for the entity’s competitiveness. Pfizer’s outstanding R&D division allows the organization to produce highly differentiated products. The company’s many patents exist due to the robust R&D unit (Gereffi, 2017). The organization also sells unique drugs whose active ingredients can only come from it (the business). On the other hand, Pfizer tries to sell some of its products, especially those not protected by patents, at reduced costs. The move allows the company to compete effectively with the many other competitors in the sector. Other alternative strategies for Pfizer include focused cost leadership and focused differentiation strategies. However, the integrated strategy appears to work well for the firm due to its ability to cater to a wide range of customers and needs worldwide. Adopting either of the alternative approaches exposes the entity to the threat of reduced scope and, thus, reduced competitiveness.

Corporate-Level Strategy


Pfizer understands the changing nature of business in the global pharmaceutical sector. The expiry of the entity’s patents and the emergence of new powerful players, especially through the amalgamation of the big players, forces the firm to adopt new tactics for survival. Diversification is a strategy that promises Pfizer increased market dominance. The business needs to finance its R&D division to introduce several other patents and lines of products to utilize the strategy. Coupling the diversification move with cause marketing further promises to cushion the entity further.


Action Items

Pfizer requires embracing new controls and incentives to continue its market dominance. The company’s structure and leadership seem alright as of now. The company needs to take care of its expiring patents to be safe. The expiry of the Viagra patent in 2020, for example, allows competitors to produce and sell drugs with a similar active ingredient (Lee, 2017). Several other products are going the same way, thus, requiring the firm to act quickly and appropriately. Another action item is the acquisition of other potential businesses.

Action Plan

Pfizer needs to empower its R&D division to develop new drug and health products’ patents to continue its market dominance. The organization has been the industry’s leader for a significant while but risks losing the ability with time. Pfizer, however, operates one of the strongest R&D divisions in the sector. The company can use its strength and the current COVID-19 situation to re-establish its vitality. The other strategies that the firm can use to maintain its market leadership are getting into more emerging economies, acquiring some competitors, and cutting costs even further.

Considering acquisition, the firm enjoys significantly high returns due to its leadership in the search for COVID-19 drugs and vaccines. Johnson (2021) reports that Pfizer’s revenues exhibit a growth potential of over ninety percent. The company’s success in COVID-19 vaccine development already gives it about fifty billion dollars return. Such implies a return of over one hundred billion dollars for the year 2021. The money is adequate for Pfizer to acquire a strategic partner to extend the market lead. The company, however, needs to identify a partner whose business idea rhymes with the company’s primary strategy. Pfizer is known for establishing and marketing new products and patents that touch lives around the world. Seeking a partner who embraces the same goals is thus very crucial for the firm.

There are several possible acquisitions for Pfizer to consider and execute. Some of the best examples of such entities include Blueprint Medicines, Aurinia Pharmaceuticals’, and Atea Pharmaceuticals. All these are young organizations in the biotech industry and with already established innovation lines. For example, Atea Pharmaceuticals is the designer and producer of AT-527, an oral therapy approved by the FDA for COVID-19 management. The company is worth 2.1 billion dollars, thus very affordable for Pfizer (Bafuma, 2021). Acquiring Atea Pharmaceuticals grants Pfizer the opportunity to utilize its trusted innovation and marketing lines to promote the invented drug’s acceptance in the market, thus, increasing market leadership and dominance. Blueprint Medicines is worth 5 billion dollars and requires many considerations by Pfizer (Bafuma, 2021). The young firm’s innovation of several proven cancer drugs stands to extend Pfizer’s unique patents significantly.


Bafuma, P. (2021). Pfizer’s CEO wants to go shopping: 3 potential companies on his radar. The Motley Fool.

Dogramatzis, D. (2016). Healthcare biotechnology: A practical guide. CRC Press.

Gereffi, G. (2017). The pharmaceutical industry and dependency in the Third World. Princeton University Press.

Jauquet, C. (2019). Healthusiasm: Making customers healthy & happy. LannooCampus.

Johnson, L. A. (2021). Pfizer’s posts $4.9B 1Q profit as vaccine strategy pays off. Associated Press.

Jörn, A. (2016). Pfizer and the challenges of the global pharmaceutical industry. Anchor Academic Publishing.

Lakdawalla, D. N. (2018). Economics of the pharmaceutical industry. Journal of Economic Literature, 56(2), 397-449.

Lee, B. (2017). Viagra: Get ready for it to become generic, cheaper, and more available. Forbes.

Leinwand, P., Mainardi, C., & Kleiner, A. (2016). Strategy that works: How winning companies close the strategy-to-execution gap. Harvard Business Review Press.

Wielka Brytania. (2017). Rules and guidance for pharmaceutical manufacturers and distributors 2017. Pharmaceutical Press.

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ApeGrade. "Pfizer Firm’s Strategic Issues and Competitiveness." March 16, 2023. https://apegrade.com/pfizer-firms-strategic-issues-and-competitiveness/.


ApeGrade. 2023. "Pfizer Firm’s Strategic Issues and Competitiveness." March 16, 2023. https://apegrade.com/pfizer-firms-strategic-issues-and-competitiveness/.


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