Daniel Montagnola Managerial Accounting Individual Project

When making my decision to obtain my PharmD. back in high school, I knew the world of opportunity that was awaiting me along with the chances to advance. However, when I decided to obtain my MBA in Healthcare Systems Management, another world of opportunity suddenly was placed in front of me. There are unlimited placements for a pharmacist in today’s society. Now when adding a MBA degree to my medical background, the placements seem endless. Mainly, numerous jobs in pharmaceutical companies suddenly become attainable and appealing. This is where the focus of my learning and goals has taken me, to be able to become an executive or director at a large pharmaceutical company, such as Pfizer or Merck. Nevertheless, much goes into a decision like this when weighing the options of accepting a job in this setting. How do I stand financially at this moment and current income? How would I stand if I were to accept the job offer that I have been offered? Does this company offer advancement for me to attain more prestigious and higher paying jobs? Does this company have a sustainable business model that will allow me to maintain a job for the future? As you can see, all these aspects play a role and that is only the tip of the inquiry. So how does one weigh the options of accepting a job offer knowing the circumstances in which they lie? I believe this process starts with determining the budget you are on at the moment and being able to make changes to changes in the future. I also believe that doing a financial analysis of the company in which you are potentially joining is critical to ensure your job is secure in the future. Under certain circumstances, the option of taking the job offer placed in front of you will be examined and deemed worthy or not as a job that will suffice for the needs of my family and I.
Pfizer Consumer Healthcare (PCH) is among the largest over-the-counter (OTC) health care products companies in the world, with a global footprint of operations in more than 90 countries. They maintain leadership positions in many markets and sell two of the top 10 global brands (Advil and Centrum). PCH develops, manufactures and markets leading non-prescription medicines, vitamins and nutritional products. Pfizer strives to bring new and better solutions to market that help consumers around the world support their health and enhance personal wellbeing. PCH drives growth through major global brands including Centrum (the world's #1 multivitamin), Caltrate (the world's #1 calcium supplement) and Advil (the world's #1 ibuprofen analgesic brand). The division's major categories consist of Pain Management, Dietary Supplements, Respiratory and Personal Care. The medical manager will implement medical strategies in support of Pfizer Consumer Healthcare therapeutic areas of interest (Nutrition, Respiratory, Pain, Personal Care, Gastrointestinal, plus other OTC areas). This role will specifically focus on Dietary Supplements and act as an essential contributor to the successful commercialization of PCH products. This includes KOL engagement and Ad Board facilitation, development and adaptation of professional material suitable to local market, marketing and sales training, other activities to support launches – all with alignment to core messaging from global franchise. The medical manager is the single point of contact within the US for all dietary supplement medical activities, plus any issues or questions requiring medical input for marketed products. The local/regional medical manager will collaborate across the broader medical community, including headquarter global franchise product science experts, marketing, sales, regulatory, and medical mangers in other countries and regions.
The responsibilities of this position are quite extensive, which is in line with the prestigious name of medical manager. The Medical Manager will provide timely and accurate responses to internal and external medical inquiries about Pfizer Consumer Healthcare Dietary Supplement products. They will review and approve of promotional materials, local product labels and medical content of all materials used in the market. They will be involved in delivering product training to sales, marketing and call center colleagues when required. They are critical in establishing and maintaining good relationships with KOLs in the market and represent PCH with external stakeholders such as KOL’s, institutions, medical societies, etc. They are required to attend meetings organized by the affiliate to contribute ideas, as well as understand and address product-related medical issues or questions. They are responsible for coordinating local responses to issues in collaboration with headquarters to ensure single medical voice for Pfizer Consumer Healthcare products. The medical manager is critical in proactively sharing competitive and scientific intelligence gathered from literature reviews, local industry forums in collaboration with global franchise product science experts and the regional medical director. Their duties also entail implementing, managing and overseeing compliance with corporate policies, procedures and processes, including Customer Engagement Programs (CEP) review, promotional material review, training curriculum.
Some requirements for this position include a BS/BA degree in Medical Sciences (e.g. Pharmacy, Life Sciences, Pharmacology or degree in Nutritional Sciences, registered Dietician). They must have 3-5 years’ experience in medical affairs, regulatory affairs or other related function. Experience in local pharmaceutical/OTC business or in the OTC industry is preferred. They must be able to partner with commercial colleagues and demonstrate medical and scientific expertise for the specified product area. This position can become a senior position if there are 5-8 years’ experience plus an advanced degree (PharmD. and MBA considered advanced).
The year is 2020 and I am four years removed from graduation. I am married to a beautiful pharmacist who works for Annie’s Pharmacy and makes $150,000 a year. She puts the max away towards retirement she can, $17,000. We both have had pharmacy jobs since graduation and I was recently offered a job as a Medical Director of US Dietary Supplements for Pfizer. We have been renting an apartment together in Saratoga Springs since graduation. We do not have kids but are thinking of having one in the near future. We would also like to build the house of our dreams. I am certain that I will be able to maintain my current job (making $160,000 a year). However, I am weighing the option of accepting the director job at Pfizer. Through my knowledge of obtaining my MBA from Union Graduate College, I know the first thing I need to do is make a budget for my family with my current salary. I need to be able to understand whether I am able to sustain the family if we are going to have a child in the future as well as build the home of our dreams. I also need to make a budget with the new salary that I would have. Although I am relatively new at living on my own I know the aspects that go into a budget and I know how to manage my money to be able to pay the bills, save for retirement, and have disposable income to maintain our way of living.
Upon being notified that there was a position open at Pfizer, I performed an analysis on the company. This was to determine whether the company will be able to sustain and last for the long term future. As a pharmaceutical company, I first looked at the product portfolio as well as its pipeline. This area of the company is, overall, what will be able to keep the company with positive cash flow as well as provide it with the optimistic future a pharmaceutical company needs to continue with its business model. Upon investigating the current portfolio Pfizer has on the market, they, as one would assume with such a large and successful company, have numerous drugs on the market that are relevant and provide significant amounts of revenue and profit. However, to note one major change in their financial statements, they had a $6,298,000,000 loss from 2011 to 2012 in revenue from two of its major branded drugs going generic, Lipitor and Geodon. These losses accounted for a majority of the reason why Pfizer’s revenues decreased from $65,259 to $58,986 (in millions). Nevertheless, the company yields large revenues on the branded products it advertises. Below is the summary of product revenue for Pfizer’s major branded products.

Revenues—Major Biopharmaceutical Products

The following table provides revenue information for several of our major biopharmaceutical products:

(MILLIONS OF DOLLARS) Year Ended December 31, % Change

PRODUCT | | PRIMARY INDICATIONS | | 2012 | | 2011 | | 2010 | | 12/11 | 11/10 | Lyrica | | Epilepsy, post-herpetic neuralgia and diabetic peripheral neuropathy, fibromyalgia, neuropathic pain due to spinal cord injury | | $ 4,158 | | $ 3,693 | | $ 3,063 | | 13 | 21 | Lipitor | | Reduction of LDL cholesterol | | 3,948 | | 9,577 | | 10,733 | | (59) | (11) | Enbrel (Outside the U.S. and Canada) | | Rheumatoid, juvenile rheumatoid and psoriatic arthritis, plaque psoriasis and ankylosing spondylitis | | 3,737 | | 3,666 | | 3,274 | | 2 | 12 | Prevnar 13/Prevenar 13 | | Vaccine for prevention of pneumococcal disease | | 3,718 | | 3,657 | | 2,416 | | 2 | 51 | Celebrex | | Arthritis pain and inflammation, acute pain | | 2,719 | | 2,523 | | 2,374 | | 8 | 6 | Viagra | | Erectile dysfunction | | 2,051 | | 1,981 | | 1,928 | | 4 | 3 | Norvasc | | Hypertension | | 1,349 | | 1,445 | | 1,506 | | (7) | (4) | Zyvox | | Bacterial infections | | 1,345 | | 1,283 | | 1,176 | | 5 | 9 | Sutent | | Advanced and/or metastatic renal cell carcinoma (mRCC), refractory gastrointestinal stromal tumors (GIST) and advanced pancreatic neuroendocrine tumor | | 1,236 | | 1,187 | | 1,066 | | 4 | 11 | Premarin family | | Menopause | | 1,073 | | 1,013 | | 1,040 | | 6 | (3) | Genotropin | | Replacement of human growth hormone | | 832 | | 889 | | 885 | | (6) | — | Xalatan/Xalacom | | Glaucoma and ocular hypertension | | 806 | | 1,250 | | 1,749 | | (36) | (29) | BeneFIX | | Hemophilia | | 775 | | 693 | | 643 | | 12 | 8 | Detrol/Detrol LA | | Overactive bladder | | 761 | | 883 | | 1,013 | | (14) | (13) | Vfend | | Fungal infections | | 754 | | 747 | | 825 | | 1 | (9) |

Chantix/Champix | An aid to smoking cessation treatment | 670 | 720 | 755 | (7) | (5) | Pristiq | Depression | 630 | 577 | 466 | 9 | 24 | ReFacto AF/Xyntha | Hemophilia | 584 | 506 | 404 | 15 | 25 | Zoloft | Depression and certain anxiety disorders | 541 | 573 | 532 | (6) | 8 | Revatio | Pulmonary arterial hypertension (PAH) | 534 | 535 | 481 | — | 11 | Medrol | Inflammation | 523 | 510 | 455 | 3 | 12 | Zosyn/Tazocin | Antibiotic | 484 | 636 | 952 | (24) | (33) | Zithromax/Zmax | Bacterial infections | 435 | 453 | 415 | (4) | 9 | Effexor | Depression and certain anxiety disorders | 425 | 678 | 1,718 | (37) | (61) | Prevnar/Prevenar (7-valent) | Vaccine for prevention of pneumococcal disease | 399 | 488 | 1,253 | (18) | (61) | Fragmin | Anticoagulant | 381 | 382 | 341 | — | 12 | Relpax | Treat the symptoms of migraine headache | 368 | 341 | 323 | 8 | 6 | Rapamune | Immunosuppressant | 346 | 372 | 388 | (7) | (4) | Cardura | Hypertension/Benign prostatic hyperplasia | 338 | 380 | 413 | (11) | (8) | Tygacil | Antibiotic | 335 | 298 | 324 | 12 | (8) | Aricept(a) | Alzheimer's disease | 326 | 450 | 454 | (28) | (1) | Xanax XR | Anxiety disorders | 274 | 306 | 307 | (10) | — | BMP2 | Development of bone and cartilage | 263 | 340 | 400 | (23) | (15) | Sulperazon | Antibiotic | 262 | 218 | 213 | 20 | 2 | Diflucan | Fungal infections | 259 | 265 | 278 | (2) | (5) | Caduet | Reduction of LDL cholesterol and hypertension | 258 | 538 | 527 | (52) | 2 | Neurontin | Seizures | 235 | 289 | 322 | (19) | (10) | Dalacin/Cleocin | Antibiotic for bacterial infections | 232 | 192 | 214 | 21 | (10) | Unasyn | Injectable antibacterial | 228 | 231 | 244 | (1) | (5) | Metaxalone/Skelaxin(b) | Muscle relaxant | 223 | 203 | — | 10 | * | Inspra | High blood pressure | 214 | 195 | 157 | 10 | 24 | Toviaz | Overactive bladder | 207 | 187 | 137 | 11 | 36 | Somavert | Acromegaly | 197 | 183 | 157 | 8 | 17 | Alliance revenues(c) | Various | 3,492 | 3,630 | 4,084 | (4) | (11) | All other(d) | Various | 8,289 | 8,584 | 8,118 | (3) | 6 | The extensive branded profile for Pfizer yielded $14,570 (in millions) in profit for 2012 which was up 46% from 2011. This increase in profit can be accounted for by an operational decline of $4.8 billion, 8%, primarily due to the loss of exclusivity of certain products, mainly Lipitor, in most major markets. Also, the cost of goods sold decreased by nearly $3 billion.
Analyzing the product pipeline was also another aspect of analyzing the company as a whole. Currently, Pfizer has 70 drugs in its pipeline. It has 29 drugs in phase I, 24 drugs in phase II, and 17 in phase III. Among these drugs, numerous drugs from the cardiovascular, inflammation, and oncology department are in phase III. These are critical to analyze and watch in the future as cardiovascular, inflammation, and oncology are becoming more and more prevalent in today’s society as obesity, obesity complications, and cancer rates are rising. With this extensive portfolio and Pfizer’s track record of quality products, it looks as if Pfizer will easily be able to push products from its pipeline to the market and continue with revenues that are well above industry standards.
I then looked further into the department I would be involved in and making executive decisions for. Upon research, I was able to determine that the consumer healthcare products had an $184,000,000 revenue increase from 2011 to 2012, or 6% increase. The revenues for this division have increased worldwide from $2,748,000,000 in 2010 to $3,212,000,000 in 2012. These increases can be attributed to certain buyout’s Pfizer has participated in. I was also able to find that Pfizer reached an agreement with AstraZeneca for the global over the counter rights for Nexium, a leading prescription drug currently approved to treat the symptoms of gastoesophageal reflux disease (GERD). There was a new drug application filed with the FDA for an OTC Nexium tablet with an aim at early 2013 for release. Another large acquisition for the consumer healthcare department would be the acquisition of Alacer Corp., the maker of Emergen-C, a line of effervescent, powdered drink mix vitamin supplements that is the largest selling branded Vitamin C line in the United States. Through the sustained revenue increase Pfizer has been able to maintain so far along with its recent acquisitions of major, well known over the counter products, I feel that this department of the company is highly profitable and will continue to increase its revenues in the future. Also, this department has been receiving more money for research and development in the past few years, even though overall research and development expenses have decreased throughout the company as a whole. This makes it appealing to a new employee candidate as it provides them with funding to find new growth. The following chart outlines the funding each department receives for research and development:
Year Ended December 31, % Change

(MILLIONS OF DOLLARS) | 2012 | | 2011 | | 2010 | | 12/11 | 11/10 | Primary Care(a) | $ 1,009 | | $ 1,307 | | $ 1,473 | | (23) | (11) | Specialty Care and Oncology(a) | 1,401 | | 1,561 | | 1,624 | | (10) | (4) | Established Products and Emerging Markets(a) | 403 | | 441 | | 452 | | (9) | (2) | Other(a), (b) | 693 | | 425 | | 428 | | 63 | (1) | Worldwide Research and Development/Pfizer Medical(c) | 2,835 | | 3,337 | | 3,709 | | (15) | (10) | Corporate and Other(d) | 1,529 | | 2,003 | | 1,797 | | (24) | 11 | Total Research and Development Expenses | $ 7,870 | | $ 9,074 | | $ 9,483 | | (13) | (4) |

Through researching the benefits of working at Pfizer as a valuable employee, Pfizer provides excellent benefits and comprehensive support, beyond industry norms. The benefits package can be customized to the needs of the individual based on their different stages in life. Pfizer also offers stock options which, at the moment and the current trend, are a great benefit. From 2010 to 2012, Pfizer has nearly doubled its earning per share from $1.03 to $1.96. The cash dividend paid per share has also increased from $0.72 in 2010 to $0.88 in 2012. These trends and increases show that the stock options look healthy and intriguing as a new employee.
Through analyzing Pfizer as a company and seeing where they have been, where they are, and where they look like they are going in the future, I feel as if this job offer is a good offer and I would accept. Upon determining I would accept the job offer; I determined that a budget should be put in place for me and my family as we have plans for large expenses in the future. There were two budgets made for two various scenarios. The two scenarios were based on the following criteria: living in Saratoga Springs, NY and being taxed on their current rates (property and school), having a mortgage based of a house value of $1.2 million with a mortgage at 4% and amortized over 30 years, both myself and spouse max out our 401k contributions at $17,000 a piece, no investment income, my salary is $180,000 a year while my spouse earns $150,000 a year. From these assumptions, a simulated tax return statement was filed and the yearly deductions from the paychecks were determined. From this simulated return, it was determined that $42,675 would be deducted from my paycheck yearly while my spouse would be deducted $32,925. Thus, it was determined that I would make, on average, $10,027 a month and my spouse would make, on average, $8,339 a month. These totals were used to base of a mock budget. These budgets included mock expenses that would be recorded in a month, on average, for the various situations. These expenses were reported as monthly averages with numerous assumptions. Appendix 1 is the budget in which no child is present but the thought of one is in the near future and I accepted the job at Pfizer. It is the budget at the present time. The second appendix is the budget in which there is a newborn child and I am currently working at Pfizer. The simulated mock tax return and assumptions can be seen in appendix 3. The simulated tax return gave me a great understanding of how the taxing on my household income would work with a few assumptions. It gave me a realistic amount of money I would have at my disposal. The following list is are assumptions for the tax return: filed jointly, both spouses max out 401k contribution at $17,000 each (shown in box 12 of W-2 forms), no investment income, no charitable contributions, mortgage payment of $3,550 per month with a mortgage of $750,000 at 4% amortized over 30 years with $450,000 down payment, property taxes of $18,450 (based off of Saratoga Springs), and maximum $2,500 of student loan interest each in which none is deductible due to income limitations.
In conclusion, I would accept this job in the future. Although I am still young and inexperienced, I feel like this job would appeal to me and it provides me and my family with enough to be able to live the lifestyle we would be living. Becoming a Medical Manager at Pfizer would be one of my dream jobs. However, as a continued learning experience, I would like to be able to modify my budget based on actual accrued expenses as well as take inflation and nominal rates into account more. Also, I would like to keep an eye on the positions available at Pfizer and analyze the benefits they provide.