GlaxoSmithKline Co. and the Competition in the Pharmaceutical Industry Essay

Competition in business is usually for market share and sales volume the tactics used to increase the aforementioned are price reduction, promotions, distribution and packaging (Richard, 2015). A competitor is a business that seeks to have your target market, reduce market share and sales volume. Competition is usually in monopolistic and oligopolistic market structures consequently, an organization can determine a competitor who poses a great threat by analyzing the share market. A decent demonstration is when Glaxo Wellcome and SmithKline Beechams merged to become GlaxoSmithKline Co. there was an increase in the market share controlled and most of their competitors either closed down or were taken over by the company. At this point GSK could easily enjoy the economies of scale (Garcon et. al 2007). Competition in the pharmaceutical industry is rampant in the therapeutic sector either for the differentiated products or homogenous products (Garcon et. al 2007). Differentiated products offer therapeutic substitutes where the differences are in terms of packaging while homogenous products compete in brand name and market share (Richard, 2015). Competition in the industry is greatly affected by the antitrust issues due to short drug trial periods and foreclosure of entry of new generic drugs in an effort to ensure that the industry has a monopolistic market structure rather than perfectly competitive (Richard, 2015). The GlaxoSmithKline Co. has been facing high competition from its competitor Pfizer on a therapeutic drug that uses integrins. GSK currently controls over 6 of the global market share in the industry (Timmerman, 2015), in an effort to increase its market influence to reach that of Pfizer and consequently outsell other drugs it has funded the drug trials with over 10m (Timmerman, 2015). Pfizer, the number one pharmaceutical company globally, identifies the threat currently posed by GSK and has bet a higher amount on the same drug in an effort to woo the investors and inventors in...

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