Annual SG&A Expense Ratio Comparison for Leading Pharmaceutical Giants

A Historical Perspective on SG&A Expense Ratios

In the competitive world of pharmaceuticals, managing Sales, General, and Administrative (SG&A) expenses is crucial for maintaining profitability. This chart provides a comparative analysis of the SG&A to Revenue Ratios for AstraZeneca, Pfizer, and GlaxoSmithKline (GSK) over the years.

Key Insights

• AstraZeneca: The data reveals that AstraZeneca's SG&A to Revenue Ratio has fluctuated significantly, peaking at around 36% in the early 2000s. This indicates a period of high administrative costs relative to revenue.

• Pfizer: Pfizer has maintained a relatively stable SG&A to Revenue Ratio, with notable peaks in the late 1990s, reaching up to 53%. This stability suggests effective cost management strategies over the years.

• GSK: GSK shows the highest variability, with a peak SG&A to Revenue Ratio of approximately 67% in 1994. This high ratio could be attributed to strategic investments in sales and administrative functions during that period.

Trends Over Time

From 1985 to 2006, the data highlights periods of high administrative costs for all three companies, with notable peaks and troughs. The early 2000s saw a general increase in SG&A expenses, possibly due to increased competition and the need for aggressive marketing strategies.

Conclusion

Understanding the SG&A to Revenue Ratio is essential for investors and stakeholders to gauge a company's efficiency in managing its administrative costs. This historical analysis provides valuable insights into the financial strategies of AstraZeneca, Pfizer, and GSK, helping to inform future investment decisions.