Bristol-Myers Squibb Vrio Analysis Essay

There are multiple health concerns worldwide and more and more drugs are needed every day. Many drugs however, are extremely expensive to develop, test, and produce. According to the Tufts Center for the Study of Drug Development (2002), it costs up to $802 million to bring a new drug to the market. In 2002, pharmaceutical companies spent $34 billion in research and development (Center-Watch, 2003). In addition to the costs, the overall time from the discovery to approve and market the drug can take up to 15 years.

Bristol-Myers Squibb, our BioPharma strategy uniquely combines the reach and resources of a major pharma company with the entrepreneurial spirit and agility of a successful biotech company. With this strategy, we focus on our customers’ needs, giving maximum priority to

The time frame and cost to release a drug for sale into the United States market is enormous. After nearly 20 years and about one billion dollars spent, a drug manufacture can begin to market its product to consumers (Philipson & Sun, 2008). The reason behind these huge numbers is the drug approval process mandated by the Food and Drug Administration. Understanding the testing process will explain the long time frame and huge costs associated with drug approval.

Drug portfolio management is one of the most important determinants of long-term prosperity of research-oriented pharmaceutical companies.

Extremely risky drug discovery and development, lengthening development times which increase development cost, return on investments, and generic competitors.

This paper hopes to share insight into the steps that are taken by companies, and the strenuous process behind developing an effective new drug.

The research and development of the pharmaceutical industry is very important as the industry relies on it to develop new products to maintain and sustain the growth of the industry (ALRC 2014). According to the Australian Government Law Reform Commission, every year, the total spending in research and development in pharmaceutical industry, which includes drug discovery, pre-clinical testing and clinical trials on drugs is around $300 million (ALRC 2014). Mergers and acquisitions are intensifying in the global pharmaceutical industry, especially over the last 10 years. With factors like exorbitant research and development costs, the relatively shorter product life cycles, and the rarity of discovering a new life-changing drug acting as catalysts, leading pharmaceutical companies now have more cause to step out and look for external collaboration. This results in an increasing number of smaller biotechnology companies merging with bigger pharmaceutical companies (The

Although this may sound like a simple process, it is unlike how the system works at this time. Currently, patents shield drugs from imitation types for up to 20 years after the drug is developed. This does not make pharmaceutical companies happy since it can take eight years give or take after development to

If competitor could immediately copy a new drug the long and high cost development process would be less attractive. In order to encourage drug manufactures to have active R&D, prescription drugs are protected by patents (lasting anywhere from 10-14 years based on the contract). These patents create a monopoly for that drug and ultimately the one for the company that produces it.

While the steps to bring a new drug to market may seem extensive and costly, they are a necessity. Clinical drug trials provide options for people with diseases while also allowing doctors to improve the way they diagnose and treat these diseases. The process is long, but the benefits that new drugs have to offer, is

Achieve a median composite eight-year product development cycle by 2010. Deliver two new molecular entity (NME) launches on average per year from 2010. In order to achieve the above objective, ensure that we have 10 or more NMEs in Phase III development by 2010. Development cycle times and quality for small molecules and biologics. Number of NME launches per year. Attrition rates. Number of development projects by phase. Number of in-licensing deals, alliances and acquisitions. R&D investment levels. Improving R&D quality and speed through leading-edge science, effective risk management and decision-making and overall business efficiency. Maximising the value of our biologics business and continuing to build a major presence in this fast-growing sector. Investing in external opportunities to enhance our internal innovation through in-licensing, alliances and acquisitions. 2008 target exceeded for small molecule development cycle times. NME and life-cycle management progressions

The United States Patent and Trademark Office is overloaded with thousands of applications a year, given an applicant can even get their patent filed. In the pharmaceutical industry, the patent process is in dire need of being reformed. A typical patent last twenty years and the process is a little different when it comes to manufacturing drugs compared to other industries. Partly because in the medical field research is more or less openly shared. However, on the pharmaceutical side the more concealed the better the chances are to get good profitable returns. During the beginning stages of getting a drug to market the drug must be tested and adhere to the Food and Drug Administration’s (FDA) guidelines. An FDA approved drug means that the

It is an Opportunity for a pharmaceutical companies at this stage: (1) company can compare

2. Patent related and Generic Competition: The developed countries like US and Europe have strong patent protection laws which gives a lot of benefits for the pharmaceutical companies. But, the patent

Although R&D has been retained by the large pharmaceutical firms, there has been a continuous decline in the R&D productivity. Controlling R&D is imperative to the success of a Pharmaceutical firm. However, as the pharmaceutical industry is maturing, there are diminishing returns to the R&D investment. Fewer and fewer blockbuster drugs are being discovered and therefore R&D is not the most value adding component in the value