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In Pursuit of Primary Care, Schering-Plough Is Growing against the Grain

Executive Summary

The marketing deal between Schering-Plough and Bayer gives Schering additional products it can sell along with its recently approved cholesterol drug Vytorin, and a significant number of reps to help it do so. As such, the deal reinforces Schering's commitment to building a primary care franchise. But it also runs counter to an emerging trend among many Big Pharmas to focus increasingly on higher-value specialist markets, which do not require a huge sales and marketing infrastructure--or the regular flow of new primary-care products necessary to support it.

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The Anti-Global, Specialist Strategy: Why Bayer's Choice Might Be Right for Other Pharmas

Bayer's retreat from the global, primary-care stage into the mid-sized, regionally-focused specialist player arena was forced upon it by its own particular set of challenges. But other drug firms facing similar issues should take note: globalism may not be the best way forward in today's environment.

The Anti-Global, Specialist Strategy: Why Bayer's Choice Might Be Right for Other Pharmas

Bayer's retreat from the global, primary-care stage into the mid-sized, regionally-focused specialist player arena was forced upon it by its own particular set of challenges. But other drug firms facing similar issues should take note: globalism may not be the best way forward in today's environment.

Schering: Addressing the Specialist Challenge

As a large yet specialist firm, Schering must compete in multiple areas. That means developing and marketing differentiated products across a number of fronts--and dealing with the lower-than-average margins that typically come with mixed portfolios. How well the German group overcomes these challenges should be of growing interest to Big Pharma, given the risks of relying on blockbusters.

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