Headaches Analysis.pdf

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Department
Management (MGS)
Course
MGSC14H3
Professor
Peter P Constantinou
Semester
Summer

Description
Selling Headaches Background Info:  Non-prescription pain reliever market in US = consists of only 3 drugs – aspirin, acetaminophen, ibuprofen  4 major pharmaceutical companies: Sterling Drug = aspirin market with Bayer Aspirin; Johnson & Johnson = acetaminophen (Tylenol) and ibuprofen (Mediprin); American Home Products = aspirin (Anacin), acetaminophen (Anacin-3), and ibuprofen (Advil); Bristol-Meyers = aspirin (Burrerin and Excedrin), acetaminophen (Datril), and ibuprofen (Nuprin)  No chemical or medicinal difference between different brands of acetaminophren and ibuprofen and no significant difference between aspirins (coating, caffeine)  companies can compete over price or use advertising o All use advertising  Anacin: “combination of highly proven and active ingredients ”were superior to and different from aspirin (caffeine not improve its effect); Anacin = “fast, fast relief”; “three out of four doctors recommended the ingredients in Anacin” – not disclose the ingredient = just aspirin  Bufferin was “twice as fast as aspirin”  St. Joseph’s aspirin was “faster than other leading pain relief tablets”  Bayers = “fastest relief of pain”  Acetaminophen advertising problems o “Last year hospitals dispensed ten times as much Tylenol as the next four brands combined” -- = not disclose that Johnson & Johnson supplied hospitals with Tylenol at very low cost  = sued by American Home Products who was saying that “hospitals recommend acetaminophen, the aspirin- free pain reliever in Anacin-3, more than any other pain reliever” – the hospital recommended acetaminophen = Tylenol  Ethical dilemma: Is it ethical for pharmaceutical companies to include false or misleading statements in their advertisements? Arguments that it’s ethical:  Companies have a responsibility to their shareholders to maximize profit  If pharmaceutical companies were to start competing over price, prices
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