Select a firm that is listed in the UK and a competitor that is listed Essay

Select a firm that is listed in the UK and a competitor that is listed elsewhere in the world. Using financial information from THOMSON ANALYTICS - Essay Example Many drugs fail to pass the various drugs administration tests issued by respective government agencies, this leads to heavy research and development costs to be levied on products that could never be seen in the markets. (Bleavins et al., 2010, p.35) Drug testing is a very time consuming as well as expensive process. This is usually disastrous for a company’s results as the R&D investment may not generate any returns in the near future, making it difficult to judge the true position of a financial statement. (Bleavins et al., 2010, p.35) It is because of such reasons why analyzing the results of a pharmaceutical company is considered to be an extensive and taxing task. Furthermore, short-term financial statement analysis may be rendered ineffective because of these reasons, as the numbers will never consider ‘what if’ scenarios (such as what if R&D costs do not provide any return in the future? or provide exceptional returns?) Perhaps the industry with the highest innovation rates, the pharmaceutical industry is an essential element of the financial system. According to Fortune Magazine, 12 pharmaceutical companies have made it in the Fortune 500 list in 2009, amongst these 6 companies were from the US, and 2 companies were from UK; the rest were also from other European regions. (Fortune, 2009, p.27) GlaxoSmithKline (hereafter referred to as GSK) and Pfizer have been close competitors for a long time, although their major focus in terms of type of drug differs substantially, these two companies still compete for top spot within many drug categories. Nevertheless, both these companies are very accomplished: Pfizer is more often in the news as compared to any of its counterparts, mostly it generates media for all the wrong reasons, but it gets lots of free publicity nonetheless. Most recently the company was surrounded in a controversy involving bribing doctors to recommend Pfizer’s