Pfizer Inc.

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Cousins Charles Pfizer and Charles Erhart formed Charles Pfizer & Co. in 1849 as a small chemical manufacturer, but it achieved early success after developing a way to improve the palatability of a treatment for parasitic worms.

Through the latter half of the 19th century, citric acid—made from lemons, limes and oranges and used in soft drinks and cleaning fluids—became Pfizer's central product. But raw material shortfalls left the company struggling to survive on the eve of World War I. In 1917, a government food chemist joined the company and pioneered a way to produce citric acid from a by-product of the cheese-making process.

Mass production of penicillin

Mass production of citric acid laid the groundwork for Pfizer's next great successes: mass production of penicillin. During World War II, a race developed to find a way to increase the production of penicillin. Using a method similar to that used to produce citric acid, Pfizer made the critical financial decision to invest heavily in new equipment and other infrastructure to make it the leading producer of the vital antibiotic.

For the war effort, the U.S. government turned to a number of companies to produce penicillin using Pfizer's technology. But thanks to its capital expenditures, Pfizer claimed it produced the bulk of the penicillin used by the Allies through the remainder of the war.

Pfizer touted its "outstanding service as the world's largest producer of penicillin" in a print ad that included photos shot inside its factories. Pfizer's success with penicillin launched the company on a trajectory from a local chemical manufacturer to a pharmaceutical behemoth and prompted it to go public in 1942.

Early on, Pfizer was content to develop drugs and allow other companies to market them. Then in 1950, when a new antibiotic, Terramycin, received government clearance, Pfizer launched its own marketing initiative and began building its now well-respected, large sales force.

Ad agency William Douglas McAdams handled the Terramycin account and, with the help of a medical ad legend, physician Arthur Sackler, revolutionized drug promotion. With the advent of "miracle drugs" came aggressive spending and higher-quality creative work.

In the 1950s and early '60s, Pfizer, then working with Leo Burnett Co., went on an acquisition binge that helped the company diversify. Among the acquisitions were the Coty cosmetic line (which was sold in 1992 after 29 years), Desitin anti-itch ointment and Barbasol shaving cream-all sold over the counter.

In 1970, as Pfizer accelerated its emphasis on developing a pharmaceutical pipeline, the company changed its name from Charles Pfizer & Co. to Pfizer Inc. and released a new logo, now widely recognized, that features the Pfizer name inside a blue oval.

New drugs

Research conducted in the 1970s led to three extremely successful Pfizer drugs, all launched in 1992, that helped boost the company's fortunes: Zithromax, via an estimated $15 million campaign from Campbell Mithun Esty, Minneapolis; anti-hypertensive Norvasc; and antidepressant Zoloft.

In late 1996, the company underwent a restructuring that unified its domestic and international sales and marketing operations. Pfizer not only marketed drugs it developed but also engaged in co-marketing deals with other companies to help promote drugs it developed. Prominent examples include the 1997 launch of Lipitor with Warner-Lambert Co. and the 1999 launch of an anti-arthritis drug, Celebrex, with what was then Monsanto Co. Both became almost overnight blockbusters with help from direct-to-consumer advertising.

Bates North America handled the Lipitor account until 2000, while Burnett had the Celebrex business. In 2000, the U.S. Food & Drug Administration asked the marketer to alter its Celebrex TV spots because the FDA felt it was out of bounds in promoting the efficacy of the drug.

Pfizer, however, is perhaps best known for marketing Viagra. In 1992, clinical trials on a drug designed to improve blood flow to the hearts of angina patients failed to produce a major breakthrough; however, some men reported that the drug had an intriguing, unintended side effect: it led to erections. Six years later, Pfizer launched Viagra. With the help of an ad campaign from Cline, Davis & Mann that featured former U.S. Sen. Bob Dole, Pfizer redefined the term "impotence" as "erectile dysfunction," or E.D. for short.

In 1999, on the heels of Viagra's success via consumer marketing, Pfizer began to look beyond its roster of agencies specializing in ads targeted at physicians. The marketer gave its accounts for allergy-treatment Zyrtec and Zoloft to Deutsch, New York; following a hostile takeover of Warner-Lambert Co. in 1999, Pfizer shifted the Lipitor account to Merkley, Newman, Harty in 2000.

The addition of Warner-Lambert brands such as Benadryl, Certs, Listerine, Neosporin, Schick, Sudafed and Trident gave Pfizer a much stronger presence in over-the-counter products.

Starting in 2003, Pfizer started to feel the effects of competition and began moving its brands around yet again.

In the process, it re-ignited the conflict over agency compensation when it enlisted Beekman Associates to gather information on agencies' overhead. Deutsch, which subsequently lost $120 million in Pfizer accounts, including Zyrtec and Zoloft, complained that Pfizer overstepped its bounds. The ensuing industry debate led to the American Association of Advertising Agencies taking a rare hard-line stance, denouncing "disreputable" compensation consultants.

In July 2003, direct-to-consumer advertising accounts for Zyrtec, Zoloft and Bextra went to WPP Group's Berlin Cameron/Red Cell, Publicis Groupe's Kaplan Thaler Group and Interpublic Group of Cos.' McCann-Erickson Worldwide, respectively.

With the introduction of Levitra and Cialis as competitors to Viagra, the brand began to slip. Within six months, from August 2003 to early 2004, Viagra lost 17% in market share. While it still controlled more than 80%, Pfizer began to worry. In late 2004, it shifted the work from Cline, Davis & Mann to Interpublic’s McCann-Erickson.

In December 2004, just two months after competitor Merck took arthritis drug Vioxx off the market, the FDA raised concerns about Pfizer’s similar drugs, Celebrex and Bextra, saying the medications increased the risk of heart attack. Pfizer did not take either drug off of pharmacy shelves, as Merck did with Vioxx, but at the request of the FDA it did stop all consumer marketing for the brands.

In 2003, Pfizer was the No. 4 national advertiser in the U.S., spending $2.8 billion, up 10.6% from 2002, according to Advertising Age.

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