AbbVie's Selling Strategy of Humira

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8th Feb 2020 Business Strategy Reference this

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I.   Executive Summary

Recently Humira, received office approval to treat moderate to severe nail disease of the skin. Humira is AbbVie’s $18 Billion a year drug. This selling report can review this usage of Humira and the way the new usage are enclosed within the current selling arrangement. 

Company Analysis

AbbVie is an international biopharmaceutical company shaped in 2013 as a results of separation activities from Abbott Laboratories. AbbVie’s mission is “to use its experience, dedicated individuals and distinctive approach to innovation to develop and market advanced therapies that address a number of the world’s most advanced and heavy diseases”. (2016 Annual Report, 2017) AbbVie manufactures merchandise centered on “treating conditions like chronic response diseases in medicine, medical specialty and dermatology; medical specialty, together with blood cancers; medicine, together with viral hepatitis (HCV) and human immunological disorder virus (HIV); neurologic disorders, like Parkinson’s illness and multiple sclerosis; metabolic diseases, together with thyroid illness and complications related to cystic fibrosis; yet as different serious health conditions”. (2016 Annual Report, 2017) AbbVie conjointly features a pipeline of potential new medicines which will treat conditions within the areas of medicine, virology, medical specialty and neurology, with further targeted investment in fibrosis and women’s health. AbbVie has more or less 30,000 staff and operates within the pharmaceutical merchandise business phase.

AbbVie’s mission is “to be associate innovation-driven, patient-focused specialty biopharmaceutical company capable of achieving top-tier monetary performance through outstanding execution and an identical stream of innovative new medicines”.  (2016 Annual Report, 2017) AbbVie seeks to still advance its mission during a variety of the way, including: “(i) growing revenues through continued  sturdy performance from its existing portfolio of on-market merchandise, together with its flagship brands, HUMIRA and IMBRUVICA yet as growth from pipeline products; (ii) increasing operative margins; (iii) continued  investment in its pipeline in support of opportunities in medicine, oncology, medicine and neurology yet as continued  investment in key on-market products; (iv) augmentation of its pipeline through combined concentrate on strategic licensing, acquisition and partnering activity with attention on characteristic compelling programs that match AbbVie’s strategic criteria; and (v) returning money to shareholders via dividends and share repurchases”. (2016 Annual Report, 2017)

AbbVie expectations are to realize its strategic objectives as follows (2016 Annual Report, 2017):

•         HUMIRA sales growth by driving biological penetration across illness classes, increasing market leadership and robust business execution.

•         IMBRUVICA revenue growth driven by increasing market share inside its 5 presently approved indications.

AbbVie continues to be committed to “driving continued growth of operative margins and expects to realize this objective through productivity initiatives in offer chain, current potency programs to optimize producing, business infrastructure, body prices and general company expenses and continued leverage from revenue growth”. (2016 Annual Report, 2017) additionally, AbbVie seeks to continue its history of returning money to shareholders via dividends and share repurchases.

Customer Analysis

EMedicineHealth.com states that over three percent of individuals within the U.S. have disease of the skin, which may “also have an effect on the fingernails and toenails, resulting in thick fingernails with erosion, ridges within the nails, nail lifting far from the nail bed, and irregular contour of the nail”. (Nail disease of the skin, n.d.) Of those, 10%-55% have disease of the skin of the nails with associate calculable of up to eightieth will have nail involvement at some purpose.

AbbVie states it provides price to its customers within the following ways:

“Its name and trade standing, with the corporate established as a reliable supplier of high-quality pharmaceutical merchandise, serving a spread of consumers, together with high-profile medical distributors and wholesalers;

Its broad portfolio of merchandise, with the corporate providing a broad vary of merchandise designed to treat a varied spectrum of diseases and conditions, targeting response diseases, oncology, virology, neurologic disorders, metabolic diseases, and different serious health conditions.

Its in depth patent portfolio, with the corporate owning and or licensing a large vary of proprietary merchandise and technologies that change it to provide distinctive merchandise that can’t be found elsewhere; Its international reach, with the corporate serving an outsized domestic client base, yet as a big variety of shoppers across Europe, Asia Pacific, and Latin America; and

Its commitment to analysis and development, with the corporate devoting a considerable portion of its resources annually to analysis and development activities, with a read to manufacturing innovative merchandise for its clients”. (2016 Annual Report, 2017)

Competitor Analysis

The markets for AbbVie’s merchandise are extremely competitive as AbbVie competes with different research-based prescription drugs and biotechnology firms that discover, manufacture, market and sell proprietary pharmaceutical merchandise and biologics. The look for technological innovations in pharmaceutical merchandise may be a important facet of competition. The introduction of latest merchandise by competitors and changes in medical practices and procedures may end up in product degeneration. worth is additionally a competitive issue. additionally, the substitution of generic pharmaceutical merchandise for branded pharmaceutical merchandise creates competitive pressures on AbbVie’s merchandise that don’t have patent protection. New merchandise or treatments dropped at market by AbbVie’s competitors might cause revenues for AbbVie’s merchandise to decrease because of worth reductions and sales volume decreases. (2016 Annual Report, 2017)

Climate

Political Factors – the govt regulates the pharmaceutical trade to guard the protection of the patients yet as regulate the export and import of the merchandise.

Economic Factors – The economic health of the country affects the approach the corporate develops new merchandise. because the country’s economic state worsens disbursal on care will increase and therefore the demand for AbbVie’s product will increase.

Social Factors – poorness, obesity, and therefore the increase of polygenic disorder are social factors which will have an effect on the event of merchandise at AbbVie as these conditions increase the probability of different diseases.

Technology Factors – Increasing use of technology to cut back the price and increase the responsibility of testing and production processes can have an effect on new development.

SWOT Analysis

One of AbbVie’s biggest strengths is Humira, “a drug that’s wont to relieve pain and cut back inflammation in individuals with variety of response diseases”. (Nordqvist, 2017) Humira has become a $16 Billion a year product fir AbbVie, and its success accumulated the popularity of the (then Abbott) AbbVie name. AbbVie has had success in maintain the patents on Humira and its different medicine, conjointly adding to the company’s strengths. Having a strong international channel is strength.

It is arduous to search out weaknesses during a company as prosperous as AbbVie, however the R&D value and prolonged investment timeframe are what could have an effect on the corporate shortly. To combat this AbbVie has been getting different company firms to extend their future pipeline. Thus may even be contributed to the priority that Humira’s patent can eventually expire and generic versions of the drug will hit the market.

Opportunities are available the shape of acquisitions and purchases that increase their pipeline, R&D resources, and market presence. AbbVie received office approval for 2 new ground-breaking medicine that treat the viral hepatitis virus. Another chance for AbbVie is that the rising care desires in each the domestic and international arena, and collaborating with third-parties to develop near-term pharmaceutical pipeline will decrease the time and value to induce to promote.

Threats that the corporate faces are the difficult regulative conditions obligatory by the assorted agencies. This political atmosphere encompassing care conjointly threatens AbbVie, as will increase in taxes. one in all the largest threats to AbbVie that has been gift for a protracted time are the biosimilar and drug makers that make the most the investment AbbVie created to develop the merchandise and sell an identical product for fewer.

IV.   Market Segmentation

The top 3 competitors for AbbVie within the market phase Humira resides in are Johnson & Johnson’s anti-TNF compound with nine.88 % of the market share, Abbott Laboratories’ Humira (part of the separation agreement was that Abbott would retain a {part of} the Humira brand) with seven.03 % of the market shares, and city Meyer Squibb Co.’s “other” medicine (not specified) with five.57 % of the market. Humira, within the same market, has 11.02 % of the market shares, so putting it at the highest of its several market. (ABBV’s Competition by phase, n.d.)

V. various selling ways

Since its initial unleash as a drugs to treat arthritis in 2002, Humira has continued  to receive multiple governmental approvals to “treat maladies starting from your scalp (itchy, painful red patches) to your middle (rigidity of the spine), to your innards (inflammation of the colon)”. (Russel, 2015)  In Sep of 2015, AbbVie won approval from the Food and Drug Administration (FDA) to promote Humira for inflamed lesions round the armpits, groin, buttocks and breasts.

VI. designated selling Strategy

To market and distribute its merchandise on a worldwide scale, AbbVie uses a spread of dedicated business resources, regional business resources and distributorships.

Product

AbbVie’s Humira may be a prescription wont to cut back the signs and symptoms of the subsequent conditions: moderate to severe arthritis (RA) in adults, moderate to severe polyarticular juvenile upset inflammatory disease (JIA) in youngsters a pair of years old and older, atrophic arthritis (PsA) in adults, rheumatoid spondylitis (AS) in adults, moderate to severe colitis (CD) in each adults and youngsters, moderate to severe hidradenitis suppurativa (HS) in adults, to assist get moderate to severe inflammatory bowel disease (UC) in check in adults, and to treat moderate to severe chronic plaque disease of the skin (Ps) in adults. Humira is run by injection underneath the skin associated is prepacked in an machine contraption pen to supply simple use. (Humira, n.d.)

Price

The wholesale value of Humira is roughly $3,700. Wholesale costs do not embrace company discounts or reductions in worth from insurers or pharmacy profit managers. AbbVie offers a reduction card however notes that “restrictions, together with monthly maximums, may apply.” (Rheumatoid inflammatory disease drug costs, n.d.).

Distribution (Place)

AbbVie’s merchandise are oversubscribed worldwide on to wholesalers, distributors, government agencies, health care facilities, specialty pharmacies and freelance retailers from AbbVie-owned distribution centers and public warehouses. within the u.  s., freelance wholesale distributors are wont to distribute AbbVie’s merchandise, with some sales on to pharmacies and patients. Outside the u.  s., sales are created either on to customers or through distributors, betting on the market served.

Certain merchandise are co-marketed or co-promoted with different firms. AbbVie has no single client that, if the client were lost, would have a cloth adverse impact on the company’s business. (2016 Annual Report, 2017)

Promotion

In 2016 AbbVie spent $363 million on direct-to-consumer advertising, and as a part of that they enclosed personal patient accounts on its web site, programs to teach physicians, medical students and medical centers regarding the drug, and, to catch the eye of senior voters, it’s providing qualified health care recipients with free product.

VII.   Short & semipermanent Projections

As Humira begins to come back off patent protection and biosimilars start to enter the market, the new indication for Humira can facilitate AbbVie sustain the semipermanent market hold that the opposite indications of Humira have had.

VIII.   Conclusion

AbbVie has been terribly prosperous with its previous selling strategy with Humira, driving sales of the assorted uses of the drug past $16 Billion a year. This freshly approved indication of the drug are projected to boost sales higher than $20 Billion a year. presently AbbVie has been able to avoid losing a number of those sales to biosimilars and generic versions of Humira, however that will not last for much longer. it’s necessary for the corporate to effectively market this new use to take care of the company’s hold on the market.

References

  • 2016 Annual Report on Form 10-K (2017). Retrieved October 24, 2017, from http://investors .abbvie.com/phoenix.zhtml?c=251551&p=irol-reportsannual
  • ABBV’s Competition by Segment and its Market Share. (n.d.). Retrieved October 24, 2017, from https://csimarket.com/stocks/competitionSEG2.php?%3F&code=ABBV
  • Humira. (n.d.). Retrieved October 24, 2017, from https://www.humira.com/?cid=ppc_ppd_ggl_ franchise_brand_2015_humira_Exact_64X1790908
  • Nail Psoriasis (n.d.) Retrieved October 24, 2017, from https://www.emedicinehealth.com /nail_psoriasis/article_em.htm
  • Rheumatoid arthritis drug prices on the rise. (n.d.). Retrieved October 25, 2017, from http:// www.modernhealthcare.com/article/20160401/NEWS/160409993
  • Russell, J. (2015, September 21). Humira: One drug. Nine uses. More on the way? Retrieved October 25, 2017, from http://www.chicagotribune.com/business/ct-humira-swiss-army-knife-0920-biz-20150918-story.html

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