CHAPTER 01
INTRODUCTION
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1.1
INTRODUCTION
Strategy can be defined as a method or plan chosen to bring about a desired future, such
as achievement of a goal or solution to a problem. Now-a-days it can be considered as
the best tool to achieve in the competitive market. Every company has special
department to perform the strategies successfully to achieve the company goal and to
ensure the superior profitability. Every company has individual managers to perform
these tasks with responsibility to achieve the competitive advantage. Strategic managers
must lead the strategy-making process.
In a firm, there are mainly three levels of management which are functional, business and
corporate. All the three level strategies are very important for a company and these are
very closely related to each other. All the firms have three separate departments to
perform these strategies successfully.
Functional level strategies are those by which a company aimed at improving the
effectiveness of companys operations and thus to achieve superior efficiency, quality,
innovation and customer responsiveness. Business level strategies are mainly an
integrated and coordinated set of commitments and actions that the firm uses to gain a
competitive advantage by exploiting core competencies in specific product markets. And
finally corporate level strategy involves the decisions that senior management makes and
the actions takes in the quest for competitive in several industries and markets
simultaneously.
For analyzing the strategies undertaken by companies, I have chosen four companies
from pharmaceutical industries. The companies are Johnson & Johnson and Novartis
from the foreign market while Square Pharmaceuticals Limited and ACME
Laboratories from the local market.
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1.2
SCOPE & OBJECTIVES OF THE STUDY
The scope of this term paper is to present the text contents from different source rather
than fully textual basis. Main scope can be defined as to know the different strategic
plans that the companies follow to attain their company goal and objective and to attain
superior profit.
My broad objective is to know the strategic plans of two local companies and two
foreign companies in the same industries. Theses strategic plans is a combination of
Business level strategy, Functional level strategy and Corporate level strategy. Then to
compare among the companies to know how successfully they are with their current
strategies.
1.3
METHODOLOGY OF THE STUDY
The prime source for the term paper content is the annual report of the respective
companies. Then I search the internet to find more contents related to this topic. I also
took the help of our two authorized book for the course which are Strategic
Management: An Integrated Approach by Charles W. L. Hill & Gareth R. Jones and
Strategic Management: Concept & Cases by Arther A. Thompson Jr. & A.J Strickland.
1.4
LIMITATION OF THE STUDY
I have faced some problems during the completion of this term paper. One of the major
limitations is that it is not easy to get the company strategy easily as it is an internal
matter. They may share the simple one in their annual report and websites which can be
shared. There was not enough time available for meeting with the company
representatives.
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CHAPTER 02
DISCUSSION: AN ANALYSIS OF
PHARMACEUTICAL INDUSTRY
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2.1
AN ANALYSIS OF PHARMACEUTICAL INDUSTRY
The branch of the chemical industry that manufactures drugs is simply known as a
pharmaceutical industry. The industry comprises enterprises that produce synthetic and
plant-derived preparations, antibiotics, vitamins, blood substitutes and hormone
preparations derived from animal organs, and drugs in various dosages, as well as
ointments, emulsions, aerosols, and plasters.
The pharmaceutical industry is responsible for the development, production and
marketing of medications. Thus, its immense importance as a global sector is evident.
The total level of pharmaceutical revenue worldwide had reached nearly one trillion U.S.
dollars. North America is responsible for the largest portion, generating more than 40
percent of these revenues. This is mostly due to the leading role of the U.S.
pharmaceutical industry. But as in many other industries, the Chinese pharmaceutical
sector shows the highest growth rates worldwide.
Pharmaceutical Industry has grown in Bangladesh in the last two decades at a
considerable rate. The sector consistently creates job opportunities for qualified people.
In Bangladesh Pharmaceutical sector is one of the most developed hi tech sector which is
contributing in the country's economy. The professional knowledge, thoughts and
innovative ideas of the pharmacists working in this sector are the key factors for these
developments. Due to recent development of this sector we are exporting medicines to
global market including European market. This sector is also providing 95% of the total
medicine requirement of the local market. Leading Pharmaceutical Companies are
expanding their business with the aim to expand export market.
For preparing this term paper I have chosen Johnson & Johnson & Novartis from the
foreign market while Square Pharmaceuticals Limited and ACME Laboratories from
the local market. I have tried to analyze their different strategies followed by them and
finally tried to compare among the strategies followed by those companies.
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2.2 JOHNSON & JOHNSON
Johnson & Johnson is a U.S multinational medical device, pharmaceutical and consumer
packaged goods manufacturer founded in 1886. In the Johnson and Johnson Company
efforts to improve the quality of life for people everywhere while still maintaining a
standard of employee and customer service. They are committed to working with moms,
healthcare professionals, scientists and experts in public health to ensure that their
products continue to achieve the highest of the JOHNSON'S Brand standards. J & J
pharmaceuticals companies offer medicines that treat many of the world's most serious
and widespread diseases. Its all part of their commitment of helping people lead longer,
healthier lives. Company strongly focuses upon its slogan of: CARING FOR THE WORLD,
ONE PERSON AT A TIME. The purpose of the company is Bringing Science to the art of
healthy living. Their vision is Trusted to enrich the health & wellness of every person
every day. The mission of the company is We will be the fastest growing consumer
healthcare company.
2.2.1
FUNCTIONAL LEVEL STRATEGY
Strategic principles that are followed can be described by the following figure:
J&J highlights strategies for growth through differentiated medicines, transformational
pipeline and global product launches. In this process they have launched 6 key
pharmaceuticals products since 2009. Johnson & Johnsons pharmaceuticals business
has taken a disciplined management approach to increasing its efficiency in order to
invest in its pipeline and new product launches. Some of the major aspects that can be
noted are:
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Deliver differentiated medicines J&J launched 6 different new products and some in
multiple geographies. Well in the upcoming year those products will surely take the
company ore forward.
Build transformational pipeline The pharmaceuticals business prioritized investments
in internal R&D, strategic licensing arrangements, partnerships and select acquisitions
continue to build a robust pipeline for the long-term. The companys pharmaceuticals
businesses expect to file 11 new products and over 30 important line extensions between
2011 and 2015.
Strengthen geographic presence The pharmaceuticals business will grow its
geographic footprint and increase investments in emerging markets, evaluating market
appropriate commercial approaches and portfolios. It also remains focused on key
developed markets. Japan, the second largest pharmaceuticals market, is a key growth
market and the companys pharmaceuticals businesses have seven launches planned
there for 2011.
Invest in talented people and organizational capabilities The Companys
pharmaceuticals business is strengthening leadership capabilities locally, regionally and
globally. A key component involves rotating key talent into important roles to quickly
accelerate skills development to address a growing and complex business environment.
The pharmaceuticals business is also building R&D capabilities in new technology areas
and emerging markets.
2.2.2
BUSINESS LEVEL STRATEGY
Business level strategy is one of the main to run a company properly and J&J maintains a
very well planned strategy to succeed in the market. They mainly followed five strategies
by which they gaining the control of the market. Their strategy contains creating value,
global reach and at the same time local focus, excellence in execution and leading with
purpose.
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Business level strategies that are followed in J&J can be understood by the following
figure:
Creating Value through Innovation: Innovations at the company means product but at
the same time it mean solutions also. Meaningful innovation derives from the insight and
spirit of their employees, and their ability to anticipate and understand the needs of our
patients and customers and what they value.
Global Reach/Local Focus: Johnson & Johnson is truly a global company, managing
facilities in some 60 countries, and selling products in about 200. They touch more than
one billion people around the world every day, but helping the next billion people might
not be so easy. While the headquartered in the U.S., their mindset is global already, 55%
of Johnson & Johnsons business comes from outside the United States; and that
proportion continues to grow.
Excellence in Execution: Nowhere is the need for excellence in execution more critical
than in health care. Excellence in execution starts with quality, a top priority at Johnson
& Johnson. It must permeate everything they do, from operational procedures, to the
actions of each employee. Their strategies, business plans, organizational structures and
everyday decisions recognize the need to focus resolutely, then execute with excellence.
Leading with Purpose: Their Credo and aspiration drives them to create innovations that
significantly impact human health and well-being. They ground their roles as
professionals in a larger purpose, and put significant responsibility on each of them as
leaders. Johnson & Johnson fosters great leadership through strong talent development
programs, offering leadership opportunities around the world.
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The Leadership Imperatives: The pursuit of their Growth Drivers is guided by the
Leadership Imperatives: Connect, Shape, Lead and Deliver. They are proof that they
recognize that how we achieve results is as important as the results themselves. They
expect leaders to develop deep insights into the needs of their stakeholders, to drive
innovation and advance health care globally by anticipating and shaping change in their
industry.
2.2.3
CORPORATE LEVEL STRATEGY
To keep up the pace with the other companys corporate level strategy plays a very
important role now-a-days. Over the year J&J has successfully merged with either
competitors or suppliers or with distribution channels. Here are the some of the majors
merging and acquisitions are listed below:
Company Acquired
Primary Focus
Date
Cordis
Vascular diseases
1996
Biopsy Medical
Breast Cancer
1997
Centocor
Immune related disease
1999
Alza
Drug Delivery
2001
Peninsula Pharmaceuticals
Life- threatening infections
2005
Synthes Inc.
Trauma cure devices
2012
Aragon Pharmaceuticals, Inc.
Drugs to treat hormonally-driven cancers
2013
Effective risk management enables the enterprise to successfully grow the business in
alignment with their Credo and strategic principles. Through this approach to risk
management, they can:
Ensure prompt resolution of internally identified risk to compliance with laws and
regulations to maintain the provision of quality products, protect patient safety
and ensure appropriate relationships with customers.
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Support simplification strategies to ensure effective use of resources, enable an
optimized approach to auditing and identification/remediation of compliance
issues and promote reporting and monitoring across compliance functions.
Enable improved decision making, planning and prioritization through a
structured understanding of opportunities and threats.
Support value creation by enabling management to deal effectively with future
events that create uncertainty, pose a significant risk or opportunity and to
respond in a prompt, efficient and effective manner.
Support our growth drivers of creating value through innovation, extending our
global reach with local focus, executing with excellence and leading with purpose.
2.3
NOVARTIS PHARMACEUTICALS
Novartis pharmaceutical is a global pharmaceutical company committed to making
medicines to treat some of the worlds most challenging diseases. Its goal is simple:
make sure that people facing disease and illness get the therapies they need, when they
need them. Novartis was created in 1996 through the merger of Ciba-Geigy and Sandoz,
two companies with a rich and diverse corporate history. Throughout the years, Novartis
and its predecessor companies have discovered and developed many innovative
products for patients and consumers worldwide. Their mission is to care and cure. They
want to discover, develop and successfully market innovative products to prevent and
cure diseases, to ease suffering and to enhance the quality of life. Novartis has five
business segments and is supported by its global research organization, the Novartis
Institutes for Biomedical Research (NIBR). These segments are strategically aligned to
bring innovative, high-quality and affordable medicines and therapies to patients around
the world.
2.3.1
FUNCTIONAL LEVEL STRATEGY
Novartis is uniquely positioned to take advantage of the fast-changing industry
environment and to fulfill its mission of caring and curing. As it enters their next growth
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phase, they are accelerating the execution of their strategy of leading through sciencebased innovation to deliver positive health outcomes for patients and payers. Their
strategic priorities are to extend their lead in innovation, accelerate growth and drive
productivity across our diversified portfolio in order to generate profits and increase
shareholder return. Committed to high performance with integrity, we are engaged in an
open and cooperative dialogue with all of our stakeholders.
Extending lead in innovation: Science-based innovation is at the heart of Novartis. They
follow a distinct research and clinical approach to build an industry-leading pipeline of
differentiated medicines and treatments with the goal of delivering real-world benefits
to patients and healthcare providers.
Accelerating growth: Novartis is pursuing long-term growth by maximizing product
launches and leveraging its robust portfolio. They are expanding in established and
emerging markets and adapting our commercial model to the rapidly changing
healthcare environment.
Driving productivity: Novartis is driving productivity by simplifying its processes,
accelerating cross-divisional collaboration, and improving global procurement and supply
chain management. They are using rigorous resource allocation to improve cash
management and profitability.
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2.3.2
BUSINESS LEVEL STRATEGY
Novartis pharmaceuticals business strategy is a unique one. They are always ready to
fulfill the customer demands and they are able to please the customer group with
sensible prices. With these they try to achieve the distinctive competencies.
Novartis has been trying a very different strategy. Instead of targeting giant populations,
it targets rare diseases with a small, very similar population. That lets scientists figure out
the molecular pathway by which the disease works and how to interrupt it.
Market Penetration: Novartis will grow markets by penetrating markets in which similar
products already exist, but their goal is to gain competitors customers and their market
share. They will also try to convince the current non-users of our products to buy our
products by using smart advertising and loyalty programs.
Market Coverage: The market coverage is differentiated in their case because they offer
different products for different target groups. However, all of thei products will be
available simultaneously in all of the selling points: Pharmacies, Supermarkets and
Hospital drugstores.
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2.3.3
CORPORATE LEVEL STRATEGY
Novartis itself created from merging two companies. Novartis strategy is based on
focused diversification. Their uniquely broad business portfolio focuses on science-based
healthcare sectors that are growing, reward innovation and enhance the lives of
patients. Innovation is fundamental to our business. In 2012, we invested $9.1 billion
(USD) across our divisions in R&D and we plan to sustain our high level of investment.
Novartis is consistently rated as having one of the industrys most respected
pharmaceutical development pipelines with 141 projects in pharmaceutical clinical
development.
The Swiss giant Novartis aims to transform itself from a pharmaceutical company to
become a broader-based health care company over the next five to ten years. To do this
it has been strengthening its core competence of science-based innovation while
focusing on five high-growth segments of healthcare: Pharmaceuticals, eye care,
generics, consumer health and vaccines and diagnostics.
2.4
SQUARE PHARMACEUTICALS LIMITED
Square Pharmaceuticals Ltd. (SPL), the pharmaceutical giant in Bangladesh, is a trusted
name in the industry of manufacturing quality medicines for more than four decade.
SQUARE today symbolizes a name a state of mind. From the inception in 1958, it has
today burgeoned into one of the top line conglomerates in Bangladesh. SQUARE
Pharmaceuticals Ltd., the flagship company, is holding the strong leadership position in
the pharmaceutical industry of Bangladesh since 1985 and is now on its way to becoming
a high performance global player. With its finished goods already dominating markets at
home and abroad, SPL started production of pharmaceutical raw materials groom its
new unit, christened as Square Chemical Division, in 1995. The items in production under
this unit are Diclofennac Sodium, Amoxycillin, Cloxacillin and Paracetamol. To sustain the
changing environment SPL made convert itself into Public Limited Company in 1991. With
a brilliant track record SPL became the first company in Bangladesh to cross the Billion
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Taka mark turnover in 1992. In 1994 SPL got its share listed in the Dhaka and Chittagong
Stock Exchanges. Authorized Capital towered to billion taka and paid up capital by now is
taka 250 million. SQUARE has extended its range of services towards the highway of
global market. It pioneered exports of medicines from Bangladesh in 1987. Through its
extended marketing operations, SQUARE is now selling its finished goods in many
countries of Asia and Europe.
2.4.1
FUNCTIONAL LEVEL STRATEGY
As per vision, mission and objectives; they are to emphasize on the quality of product,
process and services leading to growth of the company imbibed with good governance.
SPL has presently been offering its products to its market segment with the value
proposition: Utmost quality, excellent efficacy
Value creation activity includes:
Square pharmaceuticals are increasing its production day by day following the economies
of scale. Having experienced people in its productions process they are one of the
market leaders in the industry.
2.4.2
BUSINESS LEVEL STRATEGY
Square pharmaceutical Ltd being the market leader of pharmaceutical industry of
Bangladesh follows a unique set of strategies. They did not confine themselves into only
one strategy follower; rather they focused on different generic strategy for different
category of product. So they kind of diversified their portfolio among different segments
of the market.
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Cost leadership strategies: We found that square pharmaceuticals follows cost
leadership strategies for a specific set of product category. Because cost leadership
strategy is an integrated set of actions taken to produce goods or services with features
that are acceptable to customer at the lowest cost, relative to that of competitors.
Square uses the cost leadership strategy to sell no-frills, standardized products to the
industrys most typical customers. Squares products have competitive levels of
differentiation in term of features that they create value for customers. Indeed
emphasizing cost reductions while ignoring competitive levels of differentiation is
ineffective. Square pharmaceutical also carefully examines all support activities to find
additional sources of potential cost reductions. Developing new systems for finding the
optimal combination of low cost and acceptable quality in the raw materials required to
produce the drugs.
Focused Differentiation: Square pharmaceutical limited also focuses on market niche,
concentrating competitively on a specific market segment. These types of products are
usually charged with premium price and only a few numbers of companies produces or
imports those drugs. In this regard square pharmaceuticals achieved a good reputation in
medicine sector.
2.4.3
CORPORATE LEVEL STRATEGY
As per vision, mission and objectives; they are to emphasize on the quality of product,
process and services leading to growth of the company imbibed with good governance.
As the company has to import plant and machinery and almost all the raw
materials from abroad,
it maintains cordial and mutually beneficial interest with its
international as well as local suppliers. This has enabled the company to avoid any
legal disputes in international/local courts and enhanced the companys image as a
good customer. This aspect is concerned with broad decisions about the total
organizations scope and direction. Basically, consider what changes should be made in
the growth of objective and strategy for achieving it. It is useful to think of three
components of corporate level strategy: Growth or directional strategy, Portfolio
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strategy and Parenting strategy. And for the distribution of their products they have their
people to do that and for that they have a huge advantage in the market.
2.5
ACME LABORATORIES LIMITED
The ACME laboratories limited is the famous pharmaceutical company in Bangladesh and
it has been continuously in the 2nd position among all national and multinational
companies. Since its inception in 1954, has been working relentlessly with a vision to
ensure Health, Vigor and Happiness for all and is on a perpetual quest for excellence.
ACMEs quality slogan is "Perpetual Quest for Excellence". The ACME Laboratories Ltd. is
committed to maintain state-of-the-art manufacturing facilities for ensuring best quality
products to the customers. The Company is devoted to increase sales growth, increase
productivity, increase profit margin, improve company image & customer satisfaction
and ensure continual improvement. ACME continuously seeks to expand its production
facilities, add employees, and increase its sales and marketing efforts. According to the
latest statistics, ACME is one of the leading pharmaceutical companies out of more than
300 registered pharmaceutical companies in the country. ACME has also endeavored to
strengthen its network of international marketing operations to export its products
abroad. Over the years, the efforts made by the competent staff coupled with customer
confidence has fuelled our growth, prompting ACME to overcome hindrances and
progress towards its ultimate goal i.e., attaining success which indeed is what literally
ACME stands for. We are optimistic about our perpetual growth and success.
2.5.1
FUNCTIONAL LEVEL STRATEGY
ACMEs sales are growth faster than its competitors. Companys profit margin is well
matched with the company objectives and its overall financial strength is strong enough
to extend more product line. The shareholders of the company are getting more earning
per share every year and the images of the company is getting stronger year after year.
Exporting to other countries has enabled the company to extend its market and pursue it
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continue growth. High company image and widely recognition as the pioneer of the
industry is ACMEs advantage.
Manufacturing plants with flexible manufacturing
capacity and batch processing is another advantage.
2.5.2
BUSINESS LEVEL STRATEGY
ACMEs products prices are competitive because in this industry, due to its nature of
competitiveness, identical attributes of product, high buyer bargaining power and low
brand switching costs, no one can afford to charge high price. In terms of economics
point of view, this market is positively elastic, thus a slight increase in price might cause a
heavy fall in sales. As sales are increasing in this positively elastic market, we can
conclude that their prices are competitive. ACME has a long experience and by utilizing
its experience curve effect it has much cost advantage over its rivals. The plant is well
designed and well equipped with all latest facilities and state-of-the-art technologies. To
maintain quality production, their operating expenditure is also very high. ACME believes
that it is hard to compete against a firm with low costs while maintaining appropriate
quality. Thats why strategy is not to compromise the quality rather, they are willing to
realize lower profit margin in the short-run. It also believes that their high quality brand
reputation will enable them to grab an increased portion of market share in the long run
and thus enjoy economy of scale ensuring higher profit and sustainable growth.
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2.5.3
CORPORATE LEVEL STRATEGY
ACME purchase large volume of raw materials for the company and thus utilizes the
opportunities to minimize the cost in their inbound logistics. They have an opportunity to
purchase bulk amount so that they can minimize the cost in their inbound logistics. Their
purchases are relatively large volume compared to that of other pharmaceutical
companies and get a most favorable rate for the company. ACME is only integrated
downstream with its own distribution network. Most of the raw materials are directly
imported. The cost of production is minimized, as efficiency is high in production because
of Quality Management System. But the process of communication between the
manufacturing and distribution network requires various levels of inspection and
approval mechanisms, pushing the bureaucratic cost upward. The raw material used for
production purpose is fully imported, this also causes problem when exchange rate
fluctuates, exporters fail to ship raw materials timely, they suddenly increase their price,
when materials are disrupted by port congestion, political strikes, abrupt changes in
world demand and supply situation.
When the operation units complete their production, the finished products are then
stored and sent to the respective department through their own delivery units. Then
they distribute their products throughout the country. They have district medical officer
and send medicines to the needed areas at the minimum time with their own delivery
van. They also export their products to Europe, Asia and African nations to fulfill the
demand and create markets.
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CHAPTER 03
COMPARISON
&
CONCLUSION
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3.1
COMPARISON
Strategic planning involves making decisions and taking actions that help organization to
achieve goals. Strategic management involves setting the overall goals, values and
direction of the organization. Ideally, planning and management align to move an
organization forward. Comparing and contrasting an organizations strategic plan with a
management strategy can improve resourcefulness and efficiency that leads to
successfully achieving organizational goals.
Here I have already analyzed the different strategies taken by the selected company
which lies in the pharmaceuticals industry. Now I am going to compare among them in a
systematic manner:
Comparison on Functional Level Strategy:
Over the year J&J succeed to deliver new products in the market. Their major targets are
Deliver differentiated medicines, Build transformational pipeline, Strengthen geographic
presence and Invest in talented people and organizational capabilities. By doing this they
are very successful and of the main companies in the pharmaceutical industry.
On the other hand Novartis has introduced science based innovation to deliver positive
health outcomes for patients and payers. Their strategic priorities are to extend their
lead in innovation, accelerate growth and drive productivity across our diversified
portfolio in order to generate profits and increase shareholder return. Committed to high
performance with integrity, we are engaged in an open and cooperative dialogue with all
of our stakeholders.
While in Bangladesh, Square pharmaceuticals emphasizes on the quality of product,
process and services leading to growth of the company imbibed with good governance.
Square pharmaceuticals are increasing its production day by day following the economies
of scale. Having experienced people in its productions process they are one of the
market leaders in the industry.
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And last of all, ACME laboratories sales are growth faster than its competitors.
Companys profit margin is well matched with the company objectives and its overall
financial strength is strong enough to extend more product line. High company image
and widely recognition as the pioneer of the industry is ACMEs advantage.
Manufacturing plants with flexible manufacturing capacity and batch processing is
another advantage.
Comparison on Business Level Strategy:
J&J mainly followed five strategies by which they gaining the control of the market. Their
strategy contains creating value, global reach and at the same time local focus,
excellence in execution and leading with purpose.
On the other hand Novartis are always ready to fulfill the customer demands and they
are able to please the customer group with sensible prices. With these they try to achieve
the distinctive competencies. Instead of targeting giant populations, it targets rare
diseases with a small, very similar population.
Square pharmaceuticals follows cost leadership strategies for a specific set of product
category. Square uses the cost leadership strategy to sell no-frills, standardized products
to the industrys most typical customers. Square pharmaceutical limited also focuses on
market niche, concentrating competitively on a specific market segment.
And finally, ACMEs products prices are competitive because in this industry, due to its
nature of competitiveness, identical attributes of product, high buyer bargaining power
and low brand switching costs, no one can afford to charge high price. ACME believes
that it is hard to compete against a firm with low costs while maintaining appropriate
quality. Thats why strategy is not to compromise the quality rather, they are willing to
realize lower profit margin in the short-run.
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Comparison on Corporate Level Strategy:
Over the year J&J has successfully merged with either competitors or suppliers or with
distribution channels. Effective risk management enables the enterprise to successfully
grow the business in alignment with their Credo and strategic principles. J&J supports
simplification strategies to ensure effective use of resources, enable an optimized
approach to auditing and identification/remediation of compliance issues and promote
reporting and monitoring across compliance functions.
Novartis itself created from merging two companies. Novartis strategy is based on
focused diversification. Their uniquely broad business portfolio focuses on science-based
healthcare sectors that are growing, reward innovation and enhance the lives of
patients. Innovation is fundamental to our business.
In case of Square, as the company has to import plant and machinery and almost all
the raw materials from abroad, it maintains cordial and mutually beneficial interest
with its international as well as local suppliers. This has enabled the company to avoid
any legal disputes in international/local courts and enhanced the companys image as
a good customer.
ACME purchase large volume of raw materials for the company and thus utilizes the
opportunities to minimize the cost in their inbound logistics. They have an opportunity to
purchase bulk amount so that they can minimize the cost in their inbound logistics. Their
purchases are relatively large volume compared to that of other pharmaceutical
companies and get a most favorable rate for the company. ACME is only integrated
downstream with its own distribution network.
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3.2
CONCLUSION
Pharmaceutical industry is a very important human life. All the companies listed above
may have same kind of medicine for different diseases. So they must have to offer fewer
prices in comparison with the other companies to stay in the market and gain
competitive advantage among the others. Most of the companies in Bangladesh have
made strategic alliances with the foreign leader companies. As the production cost is
lower in comparison with the foreign countries so Bangladeshi companies has a huge
market internationally and the Bangladeshi companies also export a huge amount of
medicine over the years.
As it has been seen that all the four companies that I have discussed is very strong
strategically and thats why they are the market leaders. In many cases there strategy is
very with each other but yet they are different. The difference came up with how a
company implements the strategies in the field.
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REFERENCES
[Link]
[Link]
Annual Report of J&J
[Link]
[Link]
Annual Report of Novartis Pharmaceuticals
[Link]
[Link]
Annual report of Square Pharmaceuticals Limited
[Link]
[Link]
Annual report of ACME Laboratories Ltd
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