Teva Pharmaceuticals Strategy Case Paper

1064 Words Jun 2nd, 2013 5 Pages
Teva Pharmaceuticals
Strategy Overview

4/22/2013
PARTHIBAN SELVAM
SMU MBA 2013

Business Overview:
Teva Pharmaceuticals is a pharmaceutical company specializing in generic and proprietary drugs. It is the world’s 11th biggest pharmaceutical company. Apart from its major market, US and Europe, it has a major presence in Russia, Latin America, Japan and South Korea. In 2012, it had revenue of 20.3 billion and a net income of 1.96 billion (see table 1).
Target Customers:
Teva pharmaceutical’s primary customers are wholesalers and retail drug chains. Physicians and hospitals are the other major customers. Women with hormonal ailments and patients above 65 also form an important and a growing market. Also, many pharmaceutical
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Its blockbuster drug Copaxone® is facing this challenge. * Teva is actively involved in entering new markets. It seeks to achieve market leadership in japan and Russia by product portfolio management and also expand its early stage businesses in markets such as South Korea, China and India, and seek to enter new markets such as Brazil and certain South East Asia markets. * Heavy investment in R&D to develop and produce affordable biopharmaceuticals by leveraging on its formulation and manufacturing expertise. This is necessary to overcome the expiry of patents which leads to generic competition. However, Teva’s R&D expenditure amounts only to 7 % of revenues which is lower than the industry standard (16-20%). Therefore for a tangible growth, they have to invest heavily in R&D. * Extending its already significant vertical integration to its own pharmaceutical production. It introduced initiatives designed to reduce overall operating costs and complexity through a wide scale cross-functional effort to create a more efficient organization. Particular attention was given to improve procurement systems by leveraging its purchasing power and improving our production network, supply chain, and resource deployment processes. * Recent focus in entering niche businesses to differentiate itself from its competitors. This has been achieved by acquisitions (Barr pharmaceuticals, Ratiopharm, Taiyo etc) and in partnership with other

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