What is a good response to? Class - For this discussion I looked at the acquisition of Wyeth by Pfizer in 2009. The merger was announced in Jan 2009 for $68 Billion and was completed on October 15, 2009 at which time Wyeth became a wholly owned subsidiary of Pfizer. This merger was horizontal and was designed to give Pfizer both a benefit for the drugs and vaccines that Wyeth produced and developed as well as a way to combat the loss of exclusivity of Lipitor (their most profitable drug that was soon to go generic). This merger did seem to help Pfizer with a boost to revenues of 36% in the next year of 2010. And the Prevnar vaccine is still a significant - $6.4 Billion in sales - contributor to Pfizer's overall sales of $58.5 Billion as of 2023. This merger did seem to help Pfizer branch out into vaccines as well as other drugs aimed at auto-immune issues and inflammatory diseases. However this merger did not seem to do much for Wyeth. It obviously didn't dismantle Wyeth and gave them stability and access to capital, but has not clearly benefited them more than staying independent necessarily would have. The stock price of Pfizer is roughly $11/share greater now than when the merger was announced, and with some of the promising drugs that Wyeth was planning on producing and since then has produced it could have seen a much greater increase in the stock price had it remained independent. The big unknown is what a large impact the COVID vaccine and related products will have on the future of Pfizer. They got a huge boost in 2022 due to these products and there has been a steep drop-off starting in 2023. If this continues it could indicate that Wyeth could have done better alone. However, if Pfizer can turn it around it could still be a good merger for both sides.
What is a good response to?
Class -
For this discussion I looked at the acquisition of Wyeth by Pfizer in 2009. The merger was announced in Jan 2009 for $68 Billion and was completed on October 15, 2009 at which time Wyeth became a wholly owned subsidiary of Pfizer. This merger was horizontal and was designed to give Pfizer both a benefit for the drugs and vaccines that Wyeth produced and developed as well as a way to combat the loss of exclusivity of Lipitor (their most profitable drug that was soon to go generic).
This merger did seem to help Pfizer with a boost to revenues of 36% in the next year of 2010. And the Prevnar vaccine is still a significant - $6.4 Billion in sales - contributor to Pfizer's overall sales of $58.5 Billion as of 2023. This merger did seem to help Pfizer branch out into vaccines as well as other drugs aimed at auto-immune issues and inflammatory diseases. However this merger did not seem to do much for Wyeth. It obviously didn't dismantle Wyeth and gave them stability and access to capital, but has not clearly benefited them more than staying independent necessarily would have. The stock price of Pfizer is roughly $11/share greater now than when the merger was announced, and with some of the promising drugs that Wyeth was planning on producing and since then has produced it could have seen a much greater increase in the stock price had it remained independent.
The big unknown is what a large impact the COVID vaccine and related products will have on the future of Pfizer. They got a huge boost in 2022 due to these products and there has been a steep drop-off starting in 2023. If this continues it could indicate that Wyeth could have done better alone. However, if Pfizer can turn it around it could still be a good merger for both sides.
Step by step
Solved in 2 steps
