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Content Introduction1. Ranbaxy has the choice of continuing as themanufacturer of imitative generic drugs or becoming the...
Introduction Ranbaxy Laboratories Limited is Indias largest pharmaceutical company. Ranbaxy was started by Ranbir Singh ...
1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofpropriet...
1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofpropriet...
1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofpropriet...
Ranbaxy’s strategic resources Cheap labour Continuingly improving level of skills IT technology Acquired company and s...
1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofpropriet...
1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofpropriet...
1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofpropriet...
2.Should Ranbaxy focus its attention on developing marketsor the developed markets of the USA and Europe.Potter’s Diamond:...
2. Should Ranbaxy focus its attention on developing marketsor the developed markets of the USA and Europe.12Potter’s Diamo...
2. Should Ranbaxy focus its attention on developing marketsor the developed markets of the USA and Europe.Recommendations:...
3. Does India have a suitable infrastructure for innovation.14India’s Investment for Infrastructure in following sectors (...
3. Does India have a suitable infrastructure for innovation.15India’s Employment scale
3. Does India have a suitable infrastructure for innovation.Global Competitive Index (GCI) today is portraying mixed pictu...
 The present infrastructure is improving, especially in someareas (Bangalore, Mumbai and Delhi). Education Transportati...
3. Does India have a suitable infrastructure for innovation.18Conclusion :Following key areas efficiently tackles with the...
Conclusion Ranbaxy should consider its production on both products andmove its manufacturing to N.D.C because production ...
20Made By:• Shahrukh Taghvaei
Ranbaxy final
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Ranbaxy's journey

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  1. 1. Content Introduction1. Ranbaxy has the choice of continuing as themanufacturer of imitative generic drugs or becoming thedeveloper of proprietary medicines. Discuss the prosand cons of each strategy. Could it do both?2. Should Ranbaxy focus its attention on developingmarkets or the developed markets of the USA andEurope.3. Does India have a suitable infrastructure for innovation. Conclusion2
  2. 2. Introduction Ranbaxy Laboratories Limited is Indias largest pharmaceutical company. Ranbaxy was started by Ranbir Singh and Gurbax Singh in 1937 as a distributor fora Japanese company Shionogi. Headquarters Located in Gurgaon, Haryana, India Incorporated on 16th June, 1961 at Delhi. Manufacture drugs, medicines, cosmeticsand chemical products. In 2008 acquired by Daiichi Sankyo Japanese co. Global company, present in 46 countries and manufacturing ,facilities in 6 countries3
  3. 3. 1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofproprietary medicines. Discuss the pros and cons of eachstrategy. Could it do both?Emergent strategy -the decisions thatcome out from thecomplex processes inwhich managersinterpret the intendedstrategy and adapt tochanging externalsituation.4Mintzberg suggests only 10%–30% of intended strategy isrealized.External factors (political situation, production cost, laborcost)
  4. 4. 1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofproprietary medicines. Discuss the pros and cons of eachstrategy. Could it do both?Patent Act of1970 (7 years)WTOaccessionin 19952005anotherPatent act(20 years)5RisingproductioncostStiffcompetition ingenericmarketRapiddevelopments ininfrastructureExternalEnvironment
  5. 5. 1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofproprietary medicines. Discuss the pros and cons of eachstrategy. Could it do both?Before a suitable strategy can be found, it is helpful to consider characteristics ofboth products: Generic drugs - Product characteristics low price and high volume patent freetrust unimportant brand unimportant (e.g. asprin, paracetemol, etc.) Requirement = low –cost production destination Patent drugs – Product characteristics High cost of R&D Highly skilled R&D Long time R&D (5 years minimum)Trust importantBrand important (e.g. Glaxo, Zeneca, Pfizer, etc.) Requirement – highly educated, technically advanced, high trust, wellconnected (with other complimentary pharmaceutical organisations, universities,etc.)6
  6. 6. Ranbaxy’s strategic resources Cheap labour Continuingly improving level of skills IT technology Acquired company and strategic alliances (ex: Germany’s Betapharm Arzneimittel) Improvements in infrastructure71. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofproprietary medicines. Discuss the pros and cons of eachstrategy. Could it do both?
  7. 7. 1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofproprietary medicines. Discuss the pros and cons of eachstrategy. Could it do both?Generic Drugs Patent medicines+ low product price+ high revenue+ researchers at Datamonitor predicts thatthe patent expirations will be from now till2016. (pick 2011-12. ex: clopidogrelbisulfate (Plavix), for the first time)-Rising production cost in Indiacompeered to Newly developing countries(Indonesia, China, Philippines)- 20 years patent protection+ 10 years without taxes on patentmedicines (in India)+ high potential success as improvingeducation level, rising IT technology+ middle class as potential segment forsales- high investment in R&D- long period to invent and testing newproduct- high cost of advertising8(Chaudhuri, S. 2005)
  8. 8. 1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofproprietary medicines. Discuss the pros and cons of eachstrategy. Could it do both?For an organisation to obtain a sustainable competitive advantage Michael Portersuggested that they should follow either one of three generic strategies.9Strategy 1 CostLeadership.Strategy 2: Niche strategiesStrategy 3: DifferentiationPatent productFocus onmanufacturing genericGenerate profitRecommendation : Ranbaxy is rapidly loosing one of its competitive advantagesuch as low production cost as India is fast developing country, thus productioncost increases, so to be sustainable there is a need to move manufacturing toN.D.Cs.Haberberg and Rieple, 2008
  9. 9. 1. Ranbaxy has the choice of continuing as the manufacturerof imitative generic drugs or becoming the developer ofproprietary medicines. Discuss the pros and cons of eachstrategy. Could it do both?If Ranbaxy has the appropriate strategic resources, it is recommendedthat it: Continues to produce generic drugs, possibly moving production toa destination where production factors are lower; Begin developing new patented drugs in India.10Conclusion:
  10. 10. 2.Should Ranbaxy focus its attention on developing marketsor the developed markets of the USA and Europe.Potter’s Diamond:11Presence of High quality,Specialized inputs availableto Firm: Skilled & Educatedwork force.The rules and incentives thatgovern competition:Government policies andinvestment programs toencourage innovationLocal availability ofsupporting industries inclusters than an IsolationThe nature andsophistication of localcustomer needsPotter (1990)
  11. 11. 2. Should Ranbaxy focus its attention on developing marketsor the developed markets of the USA and Europe.12Potter’s Diamond: Developing Countries USA and EuropeFirm’s structure, strategy andrivalryHigh level of competition ingeneric market, which isstimulate innovationHigh level of competition ingeneric market, which isstimulate innovation (Merck& Co., Inc)Factors conditions Low cost of production(Russia, China), increasinginfrastructure,High level of workers skills,Good infrastructure,Participation in InternationalOrganization(WTO,NAFTA,EU)Demand condition Growing demand, middleclassHigh level of life an demandRelated and supportingindustriesImproving level of educations High level of education andIT technologiesRanbaxy should consider partnerships in Russia and China because India isgeographically, culturally, ideologically and politically closer to Russia and Chinathan to Europe or US.
  12. 12. 2. Should Ranbaxy focus its attention on developing marketsor the developed markets of the USA and Europe.Recommendations: Merger and Acquisition,which will give accessto foreign marketand resource.Partnership and Strategic Alliancesto create synergy effect.13create TRUST andIMAGE of theRanbaxy company
  13. 13. 3. Does India have a suitable infrastructure for innovation.14India’s Investment for Infrastructure in following sectors (US$ billion)
  14. 14. 3. Does India have a suitable infrastructure for innovation.15India’s Employment scale
  15. 15. 3. Does India have a suitable infrastructure for innovation.Global Competitive Index (GCI) today is portraying mixed picture of India’scompetitiveness as it is constrained by few structural problems simultaneouslyhaving rapid economic growth being the world fastest growing economy:16Pro ‘s Con ‘s• Huge domestic market and rapidgrowing middleclass boostinginvestment and consumption.• Not having very stronggroundwork of competitiveness tosustain and accelerate its growth innear future.• Sophisticated financial marketswhich is helping business to develops.• Increasing red tape and corruptionin governmental institutions.• Knack for innovation with highdegree of business sophistication .• Investing in vital areas ofcompetitiveness which will help Indiawhen its value chain will moveupwards.
  16. 16.  The present infrastructure is improving, especially in someareas (Bangalore, Mumbai and Delhi). Education Transportation Energy supply institutional and regulatory infrastructurefor trials and pharmaceutical Communications Heterogeneous Population.173. Does India have a suitable infrastructure for innovation.Improving
  17. 17. 3. Does India have a suitable infrastructure for innovation.18Conclusion :Following key areas efficiently tackles with the problemsdiscussed earlier:• India does have a suitable infrastructure for innovationwhen compared in certain areas with its competing countries.• Also, India is at par with much more advanced economiesin the world having vibrant democracy and favorabledemographics trends.THUS, answer is YES India does have suitable infrastructurefor innovation also, in Pharmaceutical industry.
  18. 18. Conclusion Ranbaxy should consider its production on both products andmove its manufacturing to N.D.C because production cost inIndia is increasing fast (Russia and China). Company should expand to developing countries as well as toUS and Europe. India is at par with much more advanced economies in the worldhaving vibrant democracy and favorable demographics trends anddoes have suitable infrastructure for innovation also, inPharmaceutical industry.19
  19. 19. 20Made By:• Shahrukh Taghvaei
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