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LONDON -- Have you ever drunk Horlicks, Ribena or Lucozade, calmed sensitive teeth with Sensodyne, quit smoking with Nicorette, or soothed a headache with Panadol? If so, you've used one of the many consumer health-care products made by GlaxoSmithKline (NYSE: GSK ) .
Similarly, if you or your family have ever been vaccinated against Hepatitis A or B, tetanus, MMR, typhoid, diphtheria, or influenza, then you've probably used some of GSK's 30 current vaccines.
We're all involved
Every single person over the age of 5 in the U.K. has probably used GlaxoSmithKline products at some point in his or her life -- and that's without even considering the company's main product line: prescription medicines, which address conditions including HIV, depression, asthma, heart disease, and cancer.
It's a similar story at AstraZeneca (NYSE: AZN ) , the U.K.'s second-largest pharmaceutical company. Although AstraZeneca doesn't have the consumer brands of GSK, its focus on treatments to address cardiovascular, oncology, neuroscience, gastrointestinal, infection, and respiratory conditions means it helps cure and control many of the world's most troublesome diseases.
Indeed, although you likely won't have heard of any of AstraZeneca's products, most of us probably know people who have benefited from an AstraZeneca treatment at some point in their lives.
Fabric of life
All of this goes to show that over the last 60 years, large pharmaceutical companies have become as much a part of modern life as supermarket giants such as Tesco.
Indeed, the role pharmaceuticals play in all of our lives may be one of the reasons that one of the U.K.'s most successful fund managers, Neil Woodford, has 21% of the 20 billion pounds he manages invested in just three pharmaceutical shares, two of which are GSK and AstraZeneca.
(Woodford has an outstanding track record and he isn't afraid to commit to big positions. A further 26% of his 20 billion pounds is invested in just five other shares -- and you can find out what these are and why he chose them in this free report, "8 Shares Held By Britain's Super Investor.")
How did we get here?
GSK's history stretches across three centuries and three continents. The Glaxo brand was registered as a trademark for dried (formula) milk in New Zealand in 1906. An expansion to London soon followed, where the company opened laboratories in 1935.
By that time, Thomas Beecham's famous laxative pills had been on sale in England since 1842, and the Smith, Kline & French name was well-established in the United States.
In 1952, Glaxo, Smith, Kline & French, Beecham, and Wellcome were all still separate and substantial pharmaceutical businesses. By 1995, there were just two -- SmithKline Beecham and Glaxo Wellcome -- and in 2000 the final merger came, resulting in the creation of GlaxoSmithKline.
AstraZeneca's history is a little simpler, but no less surprising -- back in 1952, who would have guessed that ICI's days as a "bellwether of British industry" were numbered? Yet in 1993, Zeneca was spun off from the chemical giant's pharmaceutical division -- a subsidiary that was founded in 1957.
During 1999, Zeneca merged with the Swedish pharmaceutical company Astra to form AstraZeneca. The two combined successfully, but in recent years, worries over the looming patent cliff have caused AstraZeneca's fortunes to wane somewhat, at least in investors' eyes.
Not the biggest...
Today, GSK is the fifth-largest company in the FTSE 100 (INDEX: ^FTSE ) and has a market cap of about 70 billion pounds. AstraZeneca's market cap is around 33 billion pounds, but the group still ranks comfortably inside the top 20. Between them, the two represent a sizable 7.5% of the U.K.'s blue-chip index -- although they are only the world's fourth- and fifth-largest pharmaceutical companies.
For the record, the biggest three, in descending order, are U.S.-based Pfizer (NYSE: PFE ) , Swiss-based Novartis, and French company Sanofi.
GSK and AstraZeneca both publish pipeline documents on their websites, showing all the treatments they currently have in development and at what stage of testing they're in. Reading these documents reminds you of some pretty nasty diseases, but it highlights just how huge an impact modern medicine has had on our lives during the last 60 years.
The two companies have even begun to work together recently, addressing the growing issue of viruses that are resistant to current antibiotics. Both companies are contributing new products to a European research initiative known as NewDrugs4BadBugs in the hope that this problem can be addressed before it becomes much worse.
The world wouldn't be the same without companies such as GSK and AstraZeneca; they really do touch all of our lives, whether we're shareholders or not.
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