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About Us
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Glaxo Holdings Ltd.
Parry, Mark E.;
Sato, Yoshinobu
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Overview
In May 1994, the U.S. patent on Smith Kline Beecham's Tagamet expired, and ten competitors immediately introduced generic versions of this ulcer medication. Some observers projected a 60 percent decline in U.S. Tagamet sales by May 1995. The Tagamet situation raised serious questions for the management of Glaxo Holdings, Ltd., because generic Tagamet was a substitute for Glaxo's Zantac, the number-one ulcer medication in the world. In addition, Merck and Smith Kline Beecham had recently purchased pharmacy-benefit-management (PBM) companies, while other research-based pharmaceutical companies such as Marion Merrell Dow and Hoechst Celanese had purchased generic-pharmaceutical firms. Thus, Glaxo's management team faced several decisions: What steps should Glaxo take to protect Zantac from generic competition? Should Glaxo purchase a PBM? Alternatively, should Glaxo purchase a generic-pharmaceutical firm?
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