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Final Draft
industry
An analysis of strategic groups will help us to understand whether they have good
strategic position or not within the industry. These analyses can be used to discover
the performance implications from the membership of strategic group. This analysis
will have a vital effect on the profitability, challenging (IO) industrial organization
economics speculations that the industries member differ only in terms of market
share
Industry of global pharmaceutical is very dominant with high and tough competition
in the property rights and research & development (Johnson, Scholes and
Whittington, 2014). The top competitors and having strategic group factors within
the industry with bullet points are as follows
1. Revenue
2. Market spending
3. The ratio spent on Research and Development
https://igeahub.com/2016/05/06/top-10-pharmaceutical-companies-2016/
http://www.tharawat-magazine.com/facts/10-largest-pharmaceutical-drugcompanies-world/#gs.oE=6lAc
https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-pharmaceuticalcompanies-are-spending-far-more-on-marketing-than-research/
We can clearly notice the J&J is the leader when it comes to market
spending which is nearly 17.5 US billion. There is close spending among
Sanofi, Merck, GSK, and Roche.
The nearer of strategic groups in the chart, rivalry will be stronger among
the group as per Porter and Heppemann (Porter and Heppelmann, 2014).
The J&J and Novartis take the competitive advantage among all. Pfizer
could increase the market spending down the line in future.
http://pharmaceuticalcommerce.com/manufacturing-and-packaging/novartis-no-1-pharmacompany-in-the-world-in-2020-says-evaluate-pharma/
Research and Development plays a crucial role in any pharmaceutical industry, the
growth of R&D flattens between 2008 and 2015 and its Spending on R&D growth
was recorded as 1.7%.
The current and forecasted spending figure from 2016 to 2022 would be 2.8%
Top ten spenders on current and future are as follows
From the above chart, in the year 2015 we can see the Roche and Novartis spent
$8.5 billion respectively taking the top position, Pfizer, J&J, and Merck spent $7.7
billion, $6.8 billion, and $6.6 billion respectively. Sanofi and AstraZeneca spent $5.6
billion each.
As per the market projection, in the year 2022, J&J would overtake Pfizer and the
Sanofi would overtake Merck.
Global pharmaceutical industries have the strict rules and regulations, tough
competitive, amendment in government policies, right of intellectual properties,
capital, continuous in R&D, from the strategic group analysis companies can still
identify the gaps within their atmosphere to adopt.
CURRENT
Now, the total scenario has changed to a larger extent because the globalization
and technology have deep effect and the government is taking the key role in
maintaining the standards and control over the pharmaceuticals industry. The
current growth of Healthcare across the world is attributed to the current trend in
which wholesalers are playing the major control and key role of strategic customer.
FUTURE
The government and wholesalers would continue to key role as the strategic leaders
in the pharmaceutical industry but consumers will also bring their gradual control in
B2C market which can be still seen limited markets only.