Expiring Lipitor patent, supply chain impact

An article in the Wall Streeat Journal (Nov 22,2011) describes a plan by Pfizer to sell Lipitor (a cholesterol reducing drug) direct to consumers once its patent expires on Nov 30. Health care plans that have contracted to sell Lipitor will be billed geneic prices, thus costing the consumer less, after co-pay than generics.  But this direct selling channel creates a conflict with pharmacists, and potentially lasts 180 days, after which generic prices drop even further.  The reason, big pharma companies need the cash to finance their operations until the next set of drugs cme to market. Do you expect he associated channel conflict to impact sales of Pfizer’s branded products at pharmacists ? Given the steep cliff faced by demands after 180 days, how should Pfizer adjust capacity and inventory ? Given rising demands in China and India, and worries about drug quality, will foreign markets offer demand opportunity as cholesterol levels rise due to changing diets and lower exercise ?

Advertisements

About aviyer2010

Professor
This entry was posted in Ecommerce, Operations Management, Supply Chain Issues and tagged , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s