"This is the beginning of the second round of consolidation in the global pharma industry and Pfizer's move is bound to put pressure on Merck, Glaxo Wellcome, Novartis and SmithKline Beecham. In India, the impact of global and domestic consolidation and the intellectual property rights (IPR) regime will change the face of the domestic industry," said Inquire equity research chief Nishid Shah. Warner-Lambert Co, late Thursday, however, said it still supports its planned merger with American Home Products Corp and will not act in response to a $79.7 billion takeover bid by Pfizer Inc. It was unclear whether AHP would raise its bid for Warner-Lambert. The Pfizer bid values Warner-Lambert at $93.28 a share, based on Pfizer's closing price on Thursday of 37-5/16.

In contrast, the American Home offer values Warner-Lambert about $82.50 a share based on AHP's closing price of 55. In India, a Pfizer-Warner Lambert combine would catapult the duo to number three slot (as per ORG MAT, August 1999 figures) in the pharmaceutical market, displacing the Delhi-based Ranbaxy Labs by a whisker. In contrast, a Warner Lambert-American Home Products combine ranks a notch lower at number four in the Indian pharma market.

Pfizer's Indian affiliate (which is 40 per cent owned by the US parent) is currently ranked ninth with a market share of 2.15 per cent, while Parke-Davis, again 40 per cent held by Warner Lambert, stands at number 22 (market share 1.42 per cent). Pfizer is growing at 10.3 per cent, against Parke Davis' 4.9 per cent, as per ORG MAT August 1999 figures. The only worrying side-effect, however, appears to be competing brands in the cough syrup segment. Pfizer's Corex and Parke-Davis' Benadryl operate in the same area. Analysts, however, say a Pfizer-Warner Lambert combine makes more strategic sense, given that globally both companies jointly market Lipitor, an innovative therapy that significantly reduces elevated levels of LDL cholestrol and triglycerides. "Obviously the two are already sharing marketing strategies for Lipitor and both companies are doing extremely well. A Pfizer-Warner Lambert deal is one of strength, rather than one aimed at overcoming weaknesses," said an analyst with a foreign brokerage firmin India.

Key Pfizer brands in India include multivitamin Becosules, anti-diabetic Diabinese, cardiac drug Amlogard and protein supplement Protinex. Parke Davis, on the other hand, has brands like Calcal, Pyridium and Ionozem in the gynaec care and cardiac care segments while consumer healthcare brands include Ferradol, Benedryl and Waterbury's compound. "If Pfizer's marketing strength is used to push Parke-Davis' consumer healthcare brands, it's a win-win situation," another analyst added.

Warner Lambert is represented by Parke Davis and 100 per cent subsidiary, Warner Lambert India Pvt Ltd, essentially into the confectionery business (popular brands include Chicklet). Pfizer Inc recently set up a 100 per cent subsidiary, besides the existing 40 per cent owned, Pfizer Ltd in India.