...threats for Pharmaceutical industry as these movements focus on green environments and reduce chemicals and carbon which comes from pharmaceutical industries. It is not being possible to ignore these issues as they are supposed to be practiced under United Nation charter for clean and better environment. For example Pfizer is a well reputed British Pharmaceutical company which has aims to save the environment as much as possible from chemicals, waste water which includes active pharmaceutical ingredients mixture of different compounds and carbon which comes from their pharmaceutical industries. Different strategies could be used to reduce carbon and chemical waste from drugs for human environment, like proper consumption ,good way of savages for hospitals waste water like advance waste water treatment technology, private house hold expire drugs, training and education of medical professionals to reduce over prescription, and public education and awareness. These strategies could be help full for save green house environment from drugs. In conclusion if we do focus on three principal strategies to reduce the input of chemicals compounds, carbon, and waste water in to the environment are substitution of complex chemical compounds, advance technical approach, and proper education and training of doctors, retailers and consumers. (Klaus Kümmerer, 2009) Social The social life, physical activities and level of health of a community affects the pharmaceutical industry. Change in...
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...Q1. Identify the main environment forces currently affecting the pharmaceutical industry. PESTLE analysis is used to help the organization to understand what is the current status of the organization and the external factors that are affecting it, whereas this also helps the management of the organizations to overcome the weak areas organizations by implementing the strategy for the future. Political The policies of the government had a great effect on the regulations and legal issues that defines both formal and informal rules for the industries innovations as compared to the other factors in the form of “parallel trade” as the attention of the industry was an increase in the economic importance’s where the government offered incentives that encouraged the industry to globalization as they focused on pharmaceutical industry to handle the challenges of price control, monopoly and trade. Overtime this led to a wide disparity in prices that exposed the industry to sensationalist newspaper headlines and consumer backlash. Economic The sales in the pharmaceutical related closer to the GDP due to the effect in interest, taxes, inflation and exchange rates that layered down the established market growth in emerging the market for the power of the payers as decision makers. The change that could also affect the foreign currency can also affect the export and imports of the drugs. Patents in other countries pay a lot for the proportion of drug cots themselves that leads to...
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...balThe global pharmaceutical industry THE GLOBAL PHARMACEUTICAL INDUSTRY INTRODUCTION According to Hunter s. Thomas "you can turn your back on person, but never turn your back on a drug, especially when it's waving a razor sharp hunting." The global pharmaceutical industry had done tremendous contribution to mankind, but now pharmaceutical companies are facing tough time in a decade. The case is broken in to different parts which is emphasized on how internal and external factors affecting the industry firstly, the main environmental forces currently affecting the industry through PEST analysis. Secondly, the implications of the changes in business environment that is internal factors through porter's five force theory. Finally, the use and limitations of the tools applied to solve case are discussed. ORIGIN AND EVOLUTION The present pharmaceutical industries are non-assembled and more of competitive but it had emerged in early 19th century in the Rhine valley near Basel Switzerland where dyestuffs were found to have antiseptic properties. Companies like Hoffman-la rochy, Sandoz, Novartis are all started as Rhine based family dyestuff and chemical companies, which are still doing tremendous business even to day. Slowly these chemical companies started making pharmaceuticals and synthetic chemicals and evolved as global players. In early 1940's the industry showed drastic changes such as introduction of penicillin and other drugs. In 1960's industry growing rapidly with...
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...9-707-441 REV: MARCH 30, 2010 TARUN KHANNA KRISHNA PALEPU CLAUDINE MADRAS Teva Pharmaceutical Industries, Ltd In Israel we have a 1970s song based on a poem from 1953 by Amir Gilboa about Theodor Herzl.1 It has a line in it about Herzl: “Suddenly a man rises in the morning, feels he is a people, and starts walking.” That is exactly what Hurvitz did. Suddenly he woke up in the morning, feels he is a giant world class company, and starts walking. No one, aside from Herzl, has accomplished anything as remotely as impressive in this country as Hurvitz. It was impossible, a million to one odds at best, and he still did it. He woke up one morning and started walking. — Ori Hershkovitz, equity analyst at Tel Aviv-based Leader & Company The markets had not been kind to Teva Pharmaceutical during the first half of 2006. The stock had plunged nearly 30% from January 1 to June 30, erasing billions of dollars from the company’s market capitalization. Even good news, such as reports in July of Teva’s wildly successful introduction of generic Zocor—the largest blockbuster drug ever to go off-patent—had failed to boost the stock significantly. Since nearly every retirement fund and mutual fund in Israel invested in Teva, this drop had been felt throughout the population, in effect amounting to every Israeli family losing NIS 3000, or $675.1 Teva was more than the world’s leading producer of generic pharmaceuticals (see Exhibit 1 for financials). It represented the gold standard of business in...
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...Introduction Discovering and bringing one new drug to the public typically costs a pharmaceutical or biotechnology company from £800 million to more than £1 billion and takes an average of 10 to 15 years. The drug discovery and development process is designed to ensure that only those pharmaceutical products that are both safe and effective are brought to market. PPD provides a broad array of drug discovery and development services and products to pharmaceutical, biotechnology and medical device companies to expedite drug development, from drug discovery through clinical studies and post-approval support. New drugs begin in the laboratory with scientists, including chemists and pharmacologists, who identify cellular and genetic factors that play a role in specific diseases. They search for chemical and biological substances that target these biological markers and are likely to have drug-like effects. Out of every 5,000 new compounds identified during the discovery process, approximately five are considered safe for testing in human volunteers after preclinical evaluations. After three to six years of further clinical testing in patients, only one of these compounds on average is ultimately approved as a marketed drug for treatment. The following sequence of research activities begins the process that results in development of new medicines: •Target Identification. Drugs usually act on either cellular or genetic chemicals in the body, known as targets, which are believed...
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...Economic Analysis 7 6) Chapter 2: Industry Analysis 9 * Industry Life Cycle * Porters 5 Forces * SWOT * PESTLE * Correlation 7) Chapter 3: Company Analysis 24 * Company Profiles (10 Companies) * Financial Ratio Analysis * DCF Valuation * Valuation Shares 8) Conclusion 74 9) Bibliography 76 RESEARCH OBJECTIVES Research Project Topic: “Analysis and Valuation of the Indian Pharma Sector” The research objectives of this specialization project are: 1) Identifying the key indicators of the Global Pharma Industry 2) Understand and analyze the Indian Pharma Industry and identify the prominent players. 3) To examine the trends in the pharma industry 4) Fundamental and Technical Analyses of the Top 10 pharma companies in India. The main objective of this study is: 1) Valuation of the Top 10 Pharma companies 2) Finding the correct share price of the company 3) Making investment decision of- Buying, Selling or Holding the stocks of the respective pharma company. EXECUTIVE SUMMARY * Global Pharma Industry is likely to grow at a CAGR of 5% to US $ 1...
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...An Overview of the UK Pharmaceutical Industry The Pharmaceutical Industry in the UK is the second largest contributor to Gross Domestic Product behind Financial Services. There are several very big players in the UK with GlaxoWelcome & SmithKline Beecham who merged in January 2000 to become Glaxo SmithKline and AstraZeneca being the two largest UK based companies. Almost all the other major pharmaceutical companies operating in the UK have undergone or are in the process of undergoing mergers and acquisitions, including AstraZeneca, Pfizer and Warner Lambert, Shire and Roberts, and Celltech with Chiroscience and Medeva. The UK pharmaceutical market is a successful, research-driven, high-technology industry. The UK market is dynamic and increasingly competitive and, it ranks third after Germany and Switzerland in the global pharmaceutical industry rankings in terms of trade balance. According to the Association of the British Pharmaceutical Industry (Abpi), the industry employs around 75,000 people, of whom over 25% are graduates. Introduction to AstraZeneca AstraZeneca is one of the world’s leading pharmaceutical companies, with a major presence in the UK. Their business is focused on providing innovative, effective medicines that make a real difference in important areas of healthcare. Other facilities in the UK include research and development, sales and marketing and manufacturing. In 2008 AstraZeneca’s total contribution to wealth creation was £4.1 billion...
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...Industry Trends According to Standard and Poor’s industry service, in the past few years, the pharmaceutical industry has been subjected to heightened competition from generic drugmakers, unprecedented pricing pressure from payers, and hard-to-control inflation in research and development budgets. Furthermore, the industry has been experiencing a decline in R&D productivity, with a lack of innovative new products being launched in recent years. The industry has suffered due to these problems in 2010, however, improvements in early-stage product pipelines in certain fields, such as cancer and diabetes, show positive long-term potential. Major cost-cutting initiatives, including sales and marketing overhauls and the reorganization of R&D operations, have been introduced as a response to the industry's concerns. New products, as well as an aging population, also provide another indication that the industry has a promising future. 1. Emerging Markets Drive Growth With markets in major developed nations being stagnant or only showing modest growth, pharmaceutical manufacturers are focusing on global emerging markets to provide momentum for industry growth over the coming years. Projections show that these markets will account for over two-fifths of global GDP, and 80% of the world's population by 2015. With respect to the pharmaceutical industry, observers have forecast that emerging markets will drive up to 90% of the sector's growth through 2020. Based on IMS...
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...Porter’s Analysis: Pharmaceutical Industry | Submitted to Dr. Grace Khoury | By: Asem Masri. Student No. 1125420 | 11/6/2014 | 1. Contents Introduction 1 Porter’s Five Forces Analysis 1 Threat of new entrants 1 Rivalry among existing firms 2 Threat of substitute products 2 Bargaining power of buyers 3 Bargaining power of suppliers 4 Relative Power of other stakeholders 4 Conclusion 5 References 5 Introduction The pharmaceutical industry in Palestine is one of the most profitable industries, with the Palestinian companies owning 55% and 30% market share of the private and public sectors respectively, and high potential of growth even more, in a market estimated at around USD 100 million. All these companies mostly reproduce generics that are seen as commodities rather than differentiated, and highly depend on preferred agreements with pharmacies, doctors, hospitals and medical centers to serve both as their marketing and distribution channels. All operating firms in the industry are publicly traded companies, are highly controlled and regulated, depend heavily on technology and require vast financial resources. Because of the large size , high complexity and vast financial requirements of the industry, it won’t be a straight forward task to decide on whether this industry is attractive to enter or not, without performing proper STEEP and industry analysis. In this case, we will focus on performing pharmaceutical industry analysis using Porter’s...
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...Indian Pharmaceutical Industry The Indian pharmaceutical industry has seen tremendous growth in the last decades and is one of the fastest growing pharmaceutical markets in the world. It is the fourth largest pharmaceutical market in the Asia Pacific region behind Japan, China and South Korea. However, the per capita spending of US$12 is among the lowest in the world, similar to levels in Pakistan and Vietnam. .India accounts for almost 10% of the global market by volume and is rapidly emerging as the leading outsourcing partner of global pharmaceutical companies, strengthened by improving Research and Development (R&D) focus and strategic position in the pharmaceutical value chain. The Industry structure of Indian Pharmaceutical sector is highly fragmented with more than 20,000 registered units with severe price competition and government price control. There are about 3,000 pharmaceutical manufacturers, the vast majority of which focus on generic drugs. The major players in the industry are Ranbaxy, Cipla, Dr. Reddy's Laboratories, Lupin, Nicolas Piramal,Aurobindo Pharma, Cadila Pharmaceuticals, Sun Pharma, W Wockhardt Ltd. and Aventis Pharma. The industry encourages international interest because of the growing population and economic improvements . Furthermore, initiatives of the Government such as allowing 100% FDI under the automatic route in drugs and pharmaceuticals including those involving use of recombinant technology act as a catalyst for growth. The...
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...Pfizer and the Challenges of the Global Pharmaceutical Industry Case Study Introduction This report is to summarize the results of Pfizer’s challenges on global pharmaceutical industry and analyze driving factors of competition. I briefly give the industry definition describing the scope of the analysis. The paper has the following major goals: 1) To analyze the current situation, major competition challenges and the prospects of the pharmaceutical industry; 2) To assess Pfizer’s position as a major players of the global pharmaceutical industry and make a comparative analysis of other business practices and financial results using the VRIO method; 3) To recommend Kindler opportunities for further strengthening of their positions by conducting Porter 5 forces. Pharmaceutical Industry Overview Historically, the pharmaceutical industry has developed, produced and marketed one of the most profitable and high margin drugs for many years. This industry has gone through substantial changes in the last few decade and pharmaceutical firms face major challenges, including headline-grabbing litigation, imminent patent expirations, new technologies, rising drug development costs, generic drug substitution, international competitors, and complex public policy issues. Competition Challenges and Prospects A firm must develop a product-market diversification strategy otherwise it may face substantial setbacks once the product loses momentum. It’s important...
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...PHARMACEUTICAL INDUSTRY IN INDIA CURRENT SCENARIO India pharmaceutical industry * Tops the chart amongst India's science-based industries with wide ranging capabilities in the complex field of drug manufacture and technology. * Is the world’s third largest by volume. * Is a highly organized sector. * Estimated to be worth $ 4.5 billion,growing at about 8 to 9 percent annually. * Manufactures almost every type of medicine . * Is extremely fragmented with many registered units.(There are approximately 250 large units and about 8000 Small Scale Units) * Plays an important role in promoting and sustaining development in the field of global medicine. * Procures more than 50 % revenue coming from the overseas markets through exports MAJOR PLAYERS IN THE INDUSTRY Company | Market Share (%) | Total Pharma Market | 100.0 | Cipla | 5.3 | Ranbaxy | 5.0 | Glaxo Smithkline | 4.3 | Piramal Healthcare | 3.9 | Zydus Cadila | 3.6 | Source: ORG IMS | 1. Ranbaxy Laboratories Limited * Biggest pharmaceutical manufacturing company in India * Ranked at the 8th position among the global generic pharmaceutical companies * Has presence in 48 countries including world class manufacturing facilities in 10 countries 2. Dr. Reddy's Laboratory * Has 60 active pharmaceutical ingredients to manufacture drugs, critical care products, diagnostic kits and biotechnology products * The company has 6 FDA plants that produce...
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...The Global Pharmaceutical Industry: Conduct an external analysis Introduction The pharmaceutical industry is described by high levels of risky and lengthy R&D process, tough competition for intellectual property, tighter government regulations and powerful pressures on buying power. (Johnson, 2006) In 2011, several blockbuster drugs patent like Lipitor will expire, possibly endangering the revenues of the pharmaceutical industry for the next three to five years. On the global level, the historical supremacy of the US was being challenged with the highest market growth rates recorded in emerging markets. The industry more than ever need to get a handle on the slippery business by offering a true step change in strategy. This case study will critically analyse the Global Pharmaceutical Industry with PESTEL, Porter’s five forces, SWOT analysis and plausible views of industry in the future. PESTLE PESTLE analysis used to help organisation to understand in depth that what is the current status of the organisation and the external factors which are effecting. It also helps to the Management to make strategy for the future and overcome the weak areas of the organization. PESTLE is comprises of political, Economical, Social, Technological, Legal and Environmental factors. Political The both policies (domestic and foreign) of government have a great effect on the industry innovation as compare to the other factors. To get the attentions of firms due to increase the economic...
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...Brand Name Pharmaceutical Manufacturing in the United States will continue to be profitable despite competition from generic pharmaceuticals, barriers to innovation, and safety regulation. An industry overview Brand Name Pharmaceutical Manufacturing in the United States is one of the largest industries in the world today. This industry produces prescription and over-the-counter drugs as well as biologic products that are primarily intended for the treatment of human illnesses (Zhong). Its major products and services include other pharmaceutical preparations, biological products, oncological products, medicinal and botanical products, respiratory agents, lipid regulators, anti-diabetics, and in-vitro diagnostic substances (Turk). Similar industries include generic pharmaceutical, cosmetic and beauty products, scientific research and development, and biotechnology manufacturing in the United States (Zhong). The Center of Drug Evaluation and Research (CDER) of the Food and Drug Administration (FDA) (Zhong) is the government agency in charge of regulation and oversight of this industry. It consists of 1,575 businesses. Major players and their market shares consist of Pfizer Inc. (10.9%), Merck and Co. Inc. (10.4%), Johnson & Johnson (8.0%), Amegen (7.4%), Eli Lilly & Company (7.2%), and Abbvie Inc (6.4%) (Turk). In 2013 it brought in $165.0 billion dollars in revenue and $35.6 billion in profits. Between the years of 2012 and 2017, the brand name pharmaceutical industry will have...
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...packaging/packaging materials for drugs, employees that supply labour: • Many suppliers available in most cases • Resources supplied not scarce in most cases • Switching cost to another supplier low • Supplied product not typically differentiated • Supplier forward integration not a threat (small supplier cannot take over large drug company) • Customers are large in a consolidated pharma industry (drug industry has been seeing lots of mergers and acquisitions in recent years so drug companies tend to be very large) LOW Power of suppliers based on above. 2) Bargaining power of buyers Who are buyers? In this case buyers would be Doctors and Hospitals (look at the drug industry’s sales force, they service DRs and hospitals, as drugs need to be prescribed, they can’t just be purchased over the counter) • Many small buyers (lots of Doctor’s offices in most areas, maybe a few larger hospitals) • Each purchases a small proportion of industry output • Buyer backward integration not a threat (a Doctor or hospital is not going to take over a drug company) • Relatively few manufacturing firms due to industry consolidation • Few substitutes (alternative medicine, lifestyle changes are possible options in some cases, but if you need drugs for diabetes no real substitute for this outside of medication) • High product differentiation (drugs are developed for specific purposes and have patent protection, differentiation decreases after patent expiry when generics can enter) • Moderate brand...
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