GSK, a merger too far? 1- Analyse these two forces : * Threat of entry : Very important * Very high expenses on advertising Direct to Consumer (DTC) * In this industry some specific skills to manufacture drugs are required, because they need to pass severe clinical trials before being commercialized. * It can take a very long time to become profitable and to compensate the speeding in R&D. * The whole industry has a bad reputation because of former issues so it is difficult
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Strategic Management Case study C: GSK, a merger too far? Answer 1: 1. By using Five Force Framework, assess the threat of rivalry and threat of entry in the pharmaceutical industry: Threats of rivalry. When we talk about threats of rivalry we should mention not only the rivalry at the industry but also at the product market level. Industry level The pharmaceutical industry has become increasingly concentrated during last 20 years. Guided by absence of proper R&D facilities, gradual expiry
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Abstract Mergers and acquisitions often referred to as M&A is also a tool for expanding ones business or get around different laws or regulations such as tax laws or monopoly regulations (Ross et al., 2002). Merger and acquisition (M &A) has been the most debatable issue in the field of management and finance. There are arguments for and against corporate restructuring and mergers. Lambrecht (2005) argued that although M&A activities occur in waves but M&A activities are as a result of the economic
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Lawrence, J.T. The merger of Glaxo Wellcome and SmithKline Beecham created the world’s second largest company and was one of the biggest and most successful merger of all time. The research paper tries to give us an insight into how everything changed for both the companies and the reason for merger, along with the advantages and disadvantages. The initial part of the paper talks about both the companies. Glaxo Wellcome and Smith Kline Beecham, both were well aware of the merger and acquisition scenario
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STRATEGY CASE PREPARATION GLAXO WELLCOME SMITHKLINE BEECHAM easeyourlife herealso External analysis industry & market Drug wholesalers independant retailers retail chains government agencies hospitals patients GSK is diversified in areas such as vaccines, generics, biologics, consumer health and nutrition. Pharmaceutical industry €665 bn value, world largest industry R&D champion Major employer Influential lobby 10-15 years to develop a drug €1,17 bn cost of research &
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Mergers and Acquisitions Tasha Powers Dr. Michael Laverty Business 508 – Contemporary Business November 17, 2014 A merger or acquisition is a combination of two companies where one corporation is completely absorbed by another corporation. The less essential company loses its identity and becomes part of the more imperative corporation, which retains its identity. A merger extinguishes the merged corporation, and the surviving corporation
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Case Study – GSK’s Acquisition of Sirtris: Independence or Integration? Questions to be answered: 1. Slaoui and Andrew Witty, GSK’s CEO must sell the acquisition of Sirtris to two key constituencies: the GSK board of directors, as well as to Westphal and the senior team at Sirtris. How would you make these pitches? 2. If you are Westphal, how do you feel when you get the call from Slaoui? What terms are you most inclined to negotiate? 3. The vast majority of startups “exits” during
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GSK Gary Benillouche Sylvain Descazeaud Stéphane Nooroya Yousra Zaghdoud Bernichi Case C : GSK 1 - Derive three opportunities and three threats for GSK by first making the PESTEL analysis of the macro-environment surrounding the pharmaceutical industry. |Political |Economic |Social | |Governments are looking for reduce healthcare|The current economic crisis.
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CASE STUDY: GSK (GlaxoSmithKline) Warm-up: • Do you think that we should prevent pharmaceutical firms applying for patents? • Selling drugs online has become a common practice. Do you believe we should go further in this direction? • Is the wave of M&A beneficial for clients in the pharmaceutical industry? Question 1: Derive three opportunities and three threats for GSK by first making the PESTEL analysis of the macro-environment surrounding the pharmaceutical industry. PESTEL analysis
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should help to increase shareholder wealth. There is, in theory, relatively little risk as the company is staying on its home territory which it knows well, but see the information about the Morrison’s – Safeway merger on page 6. 2 Market development and product development. Takeovers and mergers can give rapid access to new markets and to new product lines. There is some greater risk present because new areas are being explored and there is asymmetry of information insofar as the sellers of companies
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