Lets do a little industry analysis; the numbers here a generally reflective of market conditions in recent years, with minor adjustments, but this exercise should still be considered hypothetical. Suppose annual industry sales are $188.4 billion. In this industry there are six leading companies, several smaller significant competitors, and a number of even smaller niche firms. The top companies and their revenue data are: Company Revenue Pfizer Inc. $ 22.2 billion AbbVie Inc. $ 21.5 billion Johnson & Johnson $ 21.5 billion Merck & Co. Inc. $ 19.4 billion Amgen Inc. $ 18.3 billion Bristol-Myers Squibb $ 13.0 billion Eli Lilly & Co. $ 9.2 billion Sanofi SA $ 9.2 billion GlaxoSmithKline PLC $ 6.4 billion Other smaller firms combined $ 47.7 billion Industry Total $188.4 billion

There have been a number of mergers and acquisitions in the pharmaceutical industry in recent years, with quite a bit of M&A activity happening even now. Are these mostly (a) mergers among industry leaders, creating mega firms, (b) acquisitions by large firms buying out smaller specialty producers, or (c) smaller firms merging in order to compete with the industry leaders? Give some examples and discuss whether you think this merger activity is making the industry more competitive or less competitive.