Correspondence: Reinhard Angelmar, INSEAD Boulevard de Constance 77305 Fontainebleau Cedex France. Tel: +33(0)1 60 71 2641; Fax: +33(0)1 60 72 9240; e-mail: reinhard.angelmar@insead.edu

¹is the Salmon and Rameau Fellow in Healthcare Management and Professor of Marketing at INSEAD, Fontainebleau. An author of many studies on the pharmaceutical industry, he has worked with pharmaceutical companies such as Johnson & Johnson, Lilly, Novartis and Pfizer. He teaches a course on Pharmaceutical Marketing Strategy at INSEAD, and is also a court expert in pharmaceutical litigation.

Abstract

This case study describes the history of Bayer's anti-cholesterol medicine Baycol/Lipobay from its early development to its withdrawal from the market. Initially available only in low doses, sales of the aggressively priced Baycol/Lipobay picked up when the product was marketed at higher doses, especially in the large US market. On course for 1 billion sales, the product was suddenly withdrawn worldwide in response to reports of a number of deaths associated with its use. The withdrawal resulted in public criticism of the pharmaceutical industry and the company, multiple lawsuits against Bayer and a decline in the sales and profitability and strategic repositioning of its pharmaceutical division.