1A. Describe your company’s business model (e.g. vertical, horizontal, hybrid, FIPNet, etc. (If the company has been in existence over 10 years, you may choose to focus on the recent 10 years; if your company has been in existence for less than ten years, please describe the same since inception). Since its inception in 1981, Genzyme transformed from a start-up firm to a fully developed biotech company. The company’s major focus has been on orphan drugs and with its FIPCO (Fully Integrated Pharmaceutical Company) model, Genzyme worked to build and integrate different parts of its value chain. For a long time, this direction worked very well for the company. Orphan drugs represented a niche market that had minimal competition, besides the fact that there was an increased prevalence of rare diseases around the globe and most of the affected people were willing to pay huge amount to improve their standard of living. This resulted in positive financial results for Genzyme, which has been ranked one of the most respected companies globally. Although Genzyme received tax incentives for its research and seven years market exclusivity, this strategy presented a risk in terms of long term sustainability and the company ventured into the development of other common drugs (Diversification). This provided the company with more alternatives and attracted more clients. By spreading its business in different areas, Genzyme was able to manage risks. But the company made sure there were no silos and maintained fluidity by allowing teams to take part in exchanges. Genzyme also participated in some vertical integration for specific areas of research. For example, it acquired Cell Genesys' manufacturing operation in California to support the grow... ... middle of paper ... ...t purchase of newly issued stock. This alliance significantly expands Genzyme's pipeline of innovative medicines for the treatment of genetic diseases and will expand its horizon in Rare Diseases. Additionally, the company is speeding its commercialization efforts by investing in early-stage innovative life science companies through its SanofiGenzyme bioventures. By providing these companies with Sanofi’s financial support and Genzyme’s technical guidance, SanofiGenzyme is helping companies develop innovative products for Sanofi in general. These activities clearly demonstrate that Genzyme is actively participating in rapid commercializing of innovative products. By implementing the recommendations provided in the earlier sections, the company will be able to leverage its financial growth in order to further expand its portfolio and ensure long term sustainability.
In general the drug manufacturing industry is very risky. In order companies to stay in business they need to research and develop new products. Firstly companies need to develop new compounds, however only one on every ten thousand compounds becomes approved and it takes years to do this. Then only 3 out of 20 drugs make enough revenue to cover their development cost and only 1 out of every 3 drugs generates enough money to cover the costs of previously failed drugs.
If Lars decides to invest around $6 million more in research and development, it is highly risky as the company’s survival depends largely on the success of the launch of Ray’s new product into the market.
...ll help the company in selling generic drugs and provide affordable medications to its customer base.
As a biotechnology and pharmaceutical company, Genentech’s customers are patients with life-threatening diseases. Genentech states that it has developed Genentech's Commercial and Development Comprehensive Compliance Program.
Nucleon is a small biotechnology start-up with a very promising potential product (CRP-1), which is also the first product that Nucleon is planning to go into the clinic market. Nucleon has reached to human clinical trials phase with its product and it has no manufacturing facilities that satisfy the guidelines for these clinical trials and testing. Nucleon is on the verge of making a critical choice of manufacturing strategy, which will affect Nucleon’s survival in the intense competition in the long haul. Nucleon management is aware of the facts that they have a limited budget to start with, the financial environment in biotechnology is rapidly changing and establishing the safety and efficacy of products like CRP-1 is complex, time-consuming and expensive; that’s why they want to evaluate risks and rewards of each manufacturing strategy before making their final decision.
After conducting a basic 10 year financial analysis of the company, it has become evident that even with a highly competitive market structure they are able to improve on their performance. Ranging from 2004 to 2013 financial information, the company has shown a significant increase in their sales revenue roughly $3865 million sales in 2004 to almost four time that valuing $12970 million in 2013, which was an “increase of 10.4% over the 53 week prior year” The company’s growth strategy has been to diversify its product market and make them...
Main Issue In 2000, Rich Kender, Vice President of Financial Evaluation and Analysis at Merck & Company was discussing the opportunity of investing in licensing, manufacturing and marketing of Davanrik, a drug originally developed to treat depression by LAB Pharmaceuticals. LAB proposed to sell the rights of all the future profits made from the successful launch of Davanrik at the cost of an initial fee, royalty payments and additional payments as the drug completed each stage of the approval process. Merck & Company's organizational goal is to constantly refresh its drug development portfolio and reach as many customers as possible during the patented period. So there was not only the potential of financial gain or quantitative aspect of the offer, but also the qualitative value which will be added by getting better positioning in the risky pharmaceutical industry.
Threat of new entrants is relatively high. Companies forming alliances are potential rivals. Even if earlier such company was not considered to be a threat, after merging with some research and development company or forming alliance with another pharmaceutical company it would become a rival to Eli Lilly. The threat is however weakened by significant research and development costs necessary to successfully enter the business. Eli Lilly’s focus on a relatively narrow market of sedatives and antidepressants weakens the threat of new entrants, but other products that form lesser part of company’s sales such as insulin and others are exposed to high threat of new entrants. The need of obtaining certificates and licenses also weakens the threat of new entrants. Discussed above leads to the conclusion that threat of new entrants is medium.
It is as a result of acquiring distinct competitive advantages that CEMEX was able ...
Over the past decade, scientists have made significant advancements in the treatment of certain diseases. Unfortunately, just like any new product, the cost of developing these new technologies and treatments is extremely high. Plus, unlike other technology, heath technolo...
In June 2000, the publicly funded Human Genome Project (HGP) and the private firm Celera Genomics Inc. announced that they had completed sequencing the human genome. This unprecedented accomplishment is expected to enable doctors to diagnose, treat and even prevent numerous genetic diseases. As these two entities worked on sequencing the human genome, there was also a separate and less publicized race to patent as many human genes as possible.
Dimension Therapeutics and Voyager Therapeutics use very similar investor relations tactics. Both use distinct investor relations links with up to date stock info, investor event calendars, and annual financial reports. Each company’s website also provides detailed research programs including their stage of development. It is very difficult to ascertain either company’s ethics and profitability potential from this generic form of information. Only noticeable difference is dimension offers an investment calculator, and more frequent updates on press releases.
The case under analysis, Eli Lilly & Company, will be covering the positives and negatives with regards to the business situation and strategy of Eli Lilly. One of the major pharmaceutical and health care companies in its industry, Lilly focused its efforts on the areas of "drug research, development, and marketed to the following areas: neuroscience, endocrinology, oncology, cardiovascular disease, and women's health." Having made a strong comeback in the 1990's due to its remarkably successful antidepressant Prozac, was now facing a potential loss in profits with its patent soon to expire. The problem was not only the soon to expire patent on Prozac, but the fact that Prozac accounted for as much as 30% of total revenue was the reality Eli Lilly now faced. (Pearce & Robinson, 34-1)
The business plan will also be useful in facilitating the adoption of a strategy that will help the business prosper in the modern market. The plan will be a critical tool that will help in the production of a reliable strategy for attaining the goals and objectives. The proposed business plan will be implemented in three years time. Within the first three years, the business i...