Bayer AG:
Children's ASPIRIN*Assignment Questions
In the mid-1980s, Bayer AG faced a crisis when aspirin was associated with Reyes Syndrome, a rare but serious illness in children. Bayer decided not to remove Chilren's ASPIRIN from the market, but they pulled all promotion for the brand and complied with government regulations regarding product warnings on packaging. Shortly thereafter, new discoveries revealed the effectiveness of aspirin in the prevention of heart attacks and strokes in adults. Children's ASPIRIN - due to its lower cost and lower dosage - was an ideal product for the prevention market. Over the years, sales of Children's ASPIRIN had increased, but Bayer AG had never analyzed the percent of sales due to the children's v. prevention markets. Now the company must make a decision about what to do with the product. Should they retract Children's ASPIRIN altogether in order to increase sales of Bayer's higher-margin prevention brands or reintroduce it as a prevention product under another brand name? Implications for company growth and profitability are examined.
1. How important is aspirin to Bayer AG? How does it fit into the company's product lineup?
Bayer is a research-based, growth-oriented global enterprise. It is primarily into pharmaceutical and chemical company headquartered in Leverkusen with about 20 different business units that research, develop and manufacture products in life sciences, polymers and specialty chemical areas. It employs around 120,000 people worldwide. It has operations in almost every country. The jewel at the very center of Bayer crown is the brand aspirin. It is without any doubt the most successful over the counter drug in history. It is available in the market for more than a century. It ha ...