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AstraZeneca was formed on 6 April 1999 by the merger of Astra AB of Sweden and Zeneca Group PLC of the UK - two companies with similar science-based cultures and a shared vision of the pharmaceutical industry.
1.2. Aim :
The merger aimed to improve the combined companies ability to deliver long term growth and enduring shareholder value and through,. They discover new medicines that are designed to improve the health and quality of life of patients around the world - medicine which are innovative, effective and which offer added benefits such as reduced side effects or better ways too taking the treatment. AstraZeneca also focus on getting the best from every medicine they make by exploring all the ways it can be used or improved. At AstraZeneca, innovation is about more than just research. Their aim to stimulate continued creativity throughout their organisation by maintaining a culture in which their people feel valued, energised and rewarded fro their ideas and contribution to their success - ideas which can make a difference in all aspects of their business. And AstraZeneca support and encourage their people in discovering their own potential, through excellent learning and development opportunities that are available to them throughout their careers. With a global business comes a global responsibility for consistently high standards of behaviour worldwide. Their aim to effectively manage that responsibility and help to find mew ways of bringing benefit to society to ensure that AstraZeneca continuous to be welcomed as a valued member of the global community. They are committed to continued achievement in all of these areas to ensure a healthy future for their business so that we can continue to help improve the lives of, and add value for, all those who benefit form it.
The objectives of the report is to look at key areas intelligence of AstraZeneca the opportunity that they are having as well as internal analysis. The report also look at the strategy which could help AstraZeneca to circulate in total business environment need to add objective and all objectives need to be smart.
1.3 Methodology :
In methodology I got that opportunity to interval the analysis. The re-segment of the analysis which could be use both primary and secondary. In secondary research information from the internet, the information from consoled offices, information from annual report, the information from other resources like where the information I have got to analysis this report. In primary research, few research will be done where I moved into office into AstraZeneca in UK to collect much more information about the opportunity. Key people are in AstraZeneca offices where the human resources manager, the marketing manager or the business manager all of then help me to complete this report.
2. Analysis on Opportunities and Threats :
SWOT analysis is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involver in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favourable and unfavourable to achieving that objective.
The aim of any SWOT analysis is to identify the key internal and external factors that are important to achieving the objective. The internal factors may be viewed as strengths and weakness depending upon their impact on the organizations objectives.
2.1 Opportunities :
In teams of opportunity, the company has many to be glad about. First, its recent success in countries such as china, Latin America, and Eastern Europe can open up many possibilities. Another opportunity for the company is the increasing need for innovate drugs, especially on diseases that are currently difficult to cure such as cancer and diabetes. The company has the potential to create breakthrough drugs as shown in their development of Galida and Crestor.
AstraZeneca is a world leading pharmaceutical company with a world-class biologics capability. Backed by strong science and wide-ranging commercial skills, they are committed to sustainable development of our business and the delivery of a flow of mew medicines that make a difference in the lives of patients and create value for their shareholder and society. AstraZeneca focus their research on six therapy areas where they believe their research can make the most difference. These areas include some of the worlds most serious illnesses and together represent a major worldwide burden of disease : cancer, cardiovascular, gastrointestinal, infection, neuroscience and respiratory & inflammation. R&D investment totalled over $5 billion. They have around 12000 people in their R&D organisation and 17 principal R&D centres in eight countries. Alongside their commitment to competitiveness and performance. They continue to be led by their core values to achieve sustainable success.
2.2. Threats :
Pricing pressures were placed on the industry through legislation not only in major established markets, but also in china and India. There are also concerns on productivity and innovation, as well as n drug safety, competition, reputation, and regulation. These threats if not carefully planned and addressed, may hamper the growth of AstraZeneca to a great extent. Many pharmaceutical companies are struggling to meet these demands just to survive.
In the European Union they required to have patient risk management plan in place when new medicines are submitted for regulatory approval. They go beyond this requirement because we have found that risk management plans are beneficial to us during the research process. They therefore establish a risk management plan for a product from the time it first goes into testing in humans.
2.3. Competitive business environment :
The company is obviously being influenced in the political perspective. In the previous years, the issue on whether or not Crestor or Galida is safe has been a political issue in the United States. There were basically different factions that are against or favour the drugs, affecting the whole marketing strategy of the company.
AstraZeneca is being affected by the economics of the pharmaceutical industry in terms of increasing prices of drugs as well as increasing demands. There has been an increasing need to demonstrate the economic as well as the therapeutic value of their medicines to those who pay for healthcare.
The social concern of the company is how well the consumers will accept and see their products. Drug safety is one issue here. Accordingly, decisions on acceptable benefit/risk profiles for medicines have the potential to be positively or negatively affected by a number of factors. These include pre- and post-marketing clinical data and regulatory judgments that reflect society's concerns and aspirations. The norms of people toward drugs can also be an issue, as there are some who do not take drugs seriously, resulting in the decrease of market share.
The pharmaceutical industry is characterized by stiff competition. The international competitors of AstraZeneca are international, research-based pharmaceutical and biotechnology companies that also sell branded, patent-protected, prescription medicines. Being ahead in R&D, specifically in technologies, is a must because it will leverage a company to the top. Technologies may ease working loads; make them faster and more accurate.
3. Analysis on Strength and Weaknesses:
There are three model in my analysis which are
1. 7 p model
2. 7s model
3. 5 force model
3.1. 7 p model
3.1.1. Product :
Using technologies that make their product easier to identify and more difficult for counterfeiters to copy.
Monitoring market and supply chain activities to identify potential counterfeiting operations.
Working with supply chain partners to address product security issues.
Supporting increased awareness and education for patients and healthcare professionals.
Alongside this they continue to work with government, regulatory authorities, law enforcement agencies and tread associations in collaborative efforts to ensure a secure drag supply chain.
3.1.2. Promotion :
Over the last two year that have been working to strengthen their global platform for driving the continued and consistent integrities worldwide. Their new and expended code of conduct went into effect in 2008 and everyone in the company was trained in the new code during the year. They also revised and enhanced the content of their global policies and these become effective in January 2009. CR requirement are explicitly embedded in the new code and polices, which tougher provide clear guidance on what responsible business means for AstraZeneca and what is expected of everyone as they work to achieve their business goals.
3.1.3. People :
Their internal governance and management frameworks, they know that they must not lose sight of their stakeholders expectations. They encourage constructive dialogue with all their stockholders and others who have an interest in their activities to make sure they stay in touch with the external environment and changing demands of sustainable development. As well as their day-to-day business interaction with stockholders, which also provide the opportunity for seeking views or raising concerns, we also hold multi-stakeholder sessions focused exclusively on corporate responsibility. They also held a meeting with 21 socially responsible investors to discuss sustainability issues. In addition, they tracked employee opinion across a range of topics through their 2008 global employee survey.
3.1.4. Process :
The risk of adverse environment impacts from their products can normally be reduced or eliminated by considering environmental issues carefully during the product development process. However traditional pharmaceuticals present major challenges in this respect, since there is usually very limited flexibility to modify the active molecule to improve its environmental profile whilst preserving its efficacy and minimising any potential side effect for patients.
3.1.5. Price :
Their pricing also takes account of the fact, that as a publicly owned company, they have a duty to ensure that they continue to deliver a return on investment for their shareholders. They balance many different factors, including ensuring appropriate patient access, in our global pricing policy, which provides the framework for optimising the profitability of their products in a sustainable way. They continually review their range of medicines to identify any that may be regarded as particularly critical to meeting healthcare needs- either because they treat diseases that are prevalent in developing countries, or because they are potentially a leading or unique therapy addressing as unmet need and offering significant patient benefit in treating a serious or life-threatening condition. They also support the concept of differential pricing in this context, provided that safeguards are in place to ensure that differentially priced products are not diverted from patients who need them, to be sold and used in more in more affluent market.
3.1.6. Place :
In 2005, AstraZeneca committed over $700,00 to help the international Federation of Red Cross and Red Crescent Societies set up a new regional disaster response centre in Kuala Lumour, Malaysia. Opened in 2006, the centre in strategically located to provide life-saving relief as quickly as possible to the victims of disaster in Asia Pacific region - one of the most disaster prone areas on earth, accounting for around 60% of all natural disasters.
In my analysis I id not fined any strength and weakness for Physical Evidence in AstraZeneca.
3.2. 7 S Frame work:
3.2.1. Strategy :
Strategy is a plan of action an organisation prepares in response to or anticipation of, changes in its external environment. Strategy is differentiated by tactics or operational actions by its nature of being premeditated, well thought through and often practically rehearsed.
Strengthening their pipeline of new medicines both from their own research efforts and through externalisation to access the world of science outside AstraZeneca that will help them develop better, safer medicines. Delivering the full potential of all our marketed medicines through rigorous lifecycle management and excellent customer support, to ensure them deliver the full benefit of their range for patient and society. Delivering the full potential of all their marketed medicines through rigorous efforts and through excellent customer support, to ensure they deliver the full benefit of their range for patients and society. Re-shaping their business by challenging all aspects of their cost base to make room for further investment in the research, development, manufacturing and marketing of new medicines. Promoting a culture of responsibility and accountability because I want AstraZeneca to be valued both as a source of great medicines and as a company committed to delivering business success responsibly.
3.2.3. System :
Every organisation has some systems or internal processes to support and implement the strategy and run day-to-day affaires. AstraZeneca's high level CR management capability, during late 2007/early 2008 they established a dedicated Global CR Team of experienced CR professionals from around the company. Their Senior Executive and Senior Managers throughout the company are accountable for CR management within their areas, based on the global framework but taking account of ,national functional and site issues and priorities. Link managers are accountable for ensuring that their teams understand the requirements and that people are clear about what is expected of them as they work to achieve AstraZeneca business goals. Individually, everyone at AstraZeneca has a responsibility to integrate CR considerations into their day-to-day decision making, actions and behaviours.
3.2.5. Staff :
Organisations are made up of humans and it's the people who make the real difference to the success of the organisation in the increasingly knowledge-bases society. The importance of human resources has thus got the central position in the strategy of the organisation away from the traditional model of capital and lane. AstraZeneca's continued success depends on the skills of its people and they are committed to developing the wide range of capabilities that our global workforce offers. AstraZeneca recognise the importance of continuous dialogue and feedback. Regular meeting between managers and individuals - as well as an annual performance review - provided not only the opportunity to discuss work objectives and progress towards these, but also to plan any further personal development that may be required to achieve the objectives, and to consider longer-team career goals.
3.2.6. Skill :
AstraZeneca definition of diversity includes all their different personal skill and qualities as well as age, race and gender, where advancement depends solely on ability, performance and good teamwork. They encourage their people to share their knowledge and idea across boundaries - to build high performance team that recognise and value their differences - teams that celebrate diversity but which also embrace common goal.
3.2.2. Structure :
Business needs to be organised in a specific form of shape that is generally referred to as organisational structure. Organisations are structured in a variety of ways, dependent on their objectives and culture. The structure of the company often dictates the way it operates and performs. AstraZeneca know that effective management of these issues is critical to maintaining trust and confidence in AstraZeneca as a company committed to delivering business success responsibly. This means having systems in place for identifying the challenges and opportunities associated with their corporate responsibility, together with frameworks and clear accountabilities for managing these consistently and appropriately in line with their strategic objectives. They continue to use stakeholder engagement and external benchmarking to keep in touch with their external environment and changing demands of sustainable development. They are making progress, but for a company the size and scope of AstraZeneca, operating within an even-changing business environment, there will always be work to do to ensure that they consistently and appropriately manage the CR challenges and opportunities associated with out business activities.
3.2.4. Style :
All organisation have their own distinct culture and management style. It includes the dominant values, beliefs and norms which develop over time and become relatively enduring features of the organisational life. It also entails the way managers interact with the employees and the way they spend their time. The Board's Science Committee provide assurance to the AstraZeneca Board regarding the quality and integrity of their science-based research and development activity. As needed, this Committee also reviews, together with other external expects, important bioethics issues faced by the Company, and agrees appropriate policies on behalf of the Board.
Shared Values : All members of the organisation share some common fundamental ideas or guiding concepts around which the business is built. This may be to make money or to achieve excellence in a particular field. In my analysis I did not fined any strength and weaknesses for shared value in AstraZeneca.
3.3. Porte's Five Forces :
This section provides a summary analysis of the AstraZeneca
Porter's Five Forces model (see diagram below)
Barrier to entry: High (Pharmaceuticals). Cost of R&D and patent limitations
Industry Competition: High. Advantages gained by first mover advantage (patents)
Suppliers: supplier power is low
Buyers: buyer power is low
Substitutes: low (with patents) medium (after patent expiry)
AstraZeneca is a pharmaceutical industry which shows an upward trend in its core markets. The industry remains highly valued, has a favourable market position with strong financial make-up and
strong earnings growth. Its future potential demand trend is positive and despite increased
competition the industry still shows a continuing upward growth momentum.
4. Recommendation :
AstraZeneca has done quite well historically and analysis has revealed that they are looking to position
themselves strategically for the future. But as we enter a new era in the pharmaceutical industry
with increased patent risks and lower marginal product returns, pharmaceutical firms like AstraZeneca
must restructure their huge organizational mass to reduce structural inefficiencies, cut costs
which is required to enable them compete better in the changing global environment. Due to it
massive R&D push, AstraZeneca suffers a relatively high rate of discontinuation in pre-approval
products and more focus is required to reduce resource wastage. AstraZeneca's lack of promising
products in its early stage pipeline has left its combined pipeline relatively weaker. This pipeline
deficit will not manifest for a number of years yet, and AstraZeneca is perhaps well positioned than
most to ensure that it balances its R&D pipeline before it becomes a cause for concern in future.
AstraZeneca's imbalanced geographical presence may cause potential geographic limitations and can limit revenue growth should US demand weaken.
While the numbers of co-marketing and collaborative agreements, which AstraZeneca has established,
are currently proving very favourable, agreements that geographically limit AstraZeneca's activities will
ultimately reduce its long term potential and must be guarded against.
Finally, the economic emergence of mass production economies like India and China into the
pharmaceutical fray will require new containment strategies. While this is not an immediate
threat, over time the nature of competition will change and the big pharmaceutical firms must
develop strategies to enable them reduce threats and seize the opportunities that are created in
increasingly integrated global markets.
5. Conclusion :
AstraZeneca has a lot of yet untapped potential and it will be interesting to see
how the industry matures over the long term. Undoubtedly, the long history and global expertise
of firms like AstraZeneca, GSK and Merck will stand them in good stated to create and benefit from
emerging global opportunities. Notwithstanding it's strengths, complacency must be guarded
against because smaller, agile and innovative firms are on the prowl and all it takes for the small
upstarts is a Superdrug that can change the entire face of the industry. I have seen it in happen
in the Information & Communications industry, for all I know pharmaceuticals may just be