LONDON, Sept 11 Leading pharmaceutical companies
could release $33 billion of cash by improving working capital
management, with Pfizer, Roche, Sanofi
and Merck & Co having the biggest
opportunities, Citi analysts said on Tuesday.
Historically, drugmakers have not focused as rigorously on
working capital as other industries but the topic has received
more attention in recent years as patent expiries and pricing
pressures squeeze profit margins.
Nonetheless, most companies in the sector still pay cash
nearly a month faster than they receive it, with only
Bristol-Myers Squibb getting cash in before it pays out.
Citi said Pfizer could realise $6.1 billion, Roche $6.0
billion, Merck $4.1 billion and Sanofi $4.0 billion by moving to
best-in-class standards and limiting excess cash tied up at
suppliers, customers and in inventories.