Case Study Of Ranbaxy And Sun Pharma

The case consists of two major pharmaceutical companies that joint to collaborate their research and pharmaceutical technologies to start a joint venture in India. Both have valuable resources that have benefited both companies during the joint venture. Now both are questioning if there is still any value in maintaining the joint venture in India and will be deciding what will be the best route to take. Ranbaxy Laboratories wants to be bought out, but Eli Lilly is worried of the financial implications of such move.

Ranbaxy has become international and thus needs to concentrate more on generics and growth in US and UK; the joint venture with Eli Lilly no longer seems to be central to Ranbaxy’s current goals. With major changes in India’s regulation and patent protection, Eli Lilly can now enter the Indian market independently and soon would enjoy product patent protection.

The company is so large that no one drug can lift it from its current sales doldrums. In addition, the company was once highly attractive to investors, but its recent stock price fell to 1997 lows. This may put pressure on the company to attempt acquisitions at a time when the company is ill-equipped to integrate a new company into its organization, and it is engaged in a cost-cutting program at a time when it may need to invest even more in research and development (McTigue Pierce, 2005).

With soaring medication prices, many drug manufactures have the aspiration to increase profits, which have the effect of rising drugs cost and concerning for Americans. Fortunately, both Democrats and Republican have illustrated interest in passing Prescription Drug Affordability Act of 2015. Captivatingly, the act will allow Medicare to consult manufacturers and set affordable prices. Many have also requested to allow of purchasing medication from Canada which currently has lower drug cost. Reports often appear in the popular press about American consumers who go to Canada or Mexico to buy their prescription drugs at a fraction of what they would pay in U.S. pharmacies, even though doing so is illegal (1). By contrast, the United States leads

This opportunity led to several dealings that would result in Shire Pharmaceuticals purchasing the rights to Europe and Salix to

However, according to exhibit 7, the major product segment information of Lilly has shifted from 35% anti-infectives and 26% neurosciences in 1996 to 48% neurosciences and 24% endocrinology in 2000. While the major project segment of Ranbaxy remains in anti infectants from 49% in 1996 to 56% in 2000. This suggests that the conflict of product between the two companies was insignificant and therefore, from Eli lilly’s perspective, continuing the joint venture would be a good option.

statin), and Zostavax (a vaccine for prevention of shingles in adults older than 60 years of

An explosion of mergers has occurred in the biopharmaceutical businesses. Contrasting to mergers occurring in the early 2000s, the biopharmaceutical businesses combine for R&D purposes. As stated earlier biopharmaceutical have moved to the forefront and has contributed to in access to 76 billion dollars in 2011 (Lang, 2003). As businesses look for advanced marketing and distribution centers they look to merge. A business may decide to merge into different ventures whereas a similar company is primarily already operating rather than start from scratch, and so the company may just merge with the other company to diversify their products and services.

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

Questcor Pharmaceuticals was founded after the merger between Cypros Pharmaceuticals Corporation and RiboGene Inc. The company then acquired Aventis Acthar Gel. To ascertain whether this company could be acquired by Embry Investment Group (EIG), the study undertook to review Questcor Pharmaceutical Inc. annual reports from the year 1996 to 2001. The study has nevertheless reviewed the company's 2012 third quarter financial results. The study showed that the company's share value was increasing from the time it was incorporated. Its gross profit was also on an upward trend from 1996. This makes the company suitable for acquisition by Embry Investment Group.

Eli Lilly was approached by a leading pharmaceutical firm in India to consider building a joint venture together. Ranbaxy Laboratories began as a family business in the 1960’s, but with strong entrepreneurial skills the company grew to become one of the largest manufacturers for bulk drugs and generic drugs. The two companies considered pursuing a joint venture that would support on another’s products by supplying one other with ingredients to complete company products without having to trade with other companies internationally. The JV would potentially lead both companies, together to become a dominant force in the Indian market.

Pfizer is one of the most important U.S. pharmaceuticals producers, and one of the top players on international level. Its core operating segments are primary care, specialty care and oncology, established products and emerging markets, and animal healthcare. Pfizer is also the world's largest research based pharmaceuticals company. This means that its investments in research and development processes determine innovation. Most of the company's profits comes from selling Rx and over the counter products, but Pfizer also commercializes dietary supplements (Pfizer, 2013). These dietary supplements are easier to sell because of the more permissive legal framework that

GSK is the 2nd largest pharmaceutical firm in the world, and the largest in the UK by sales and profits, it is responsible for 7% of the worlds pharmaceutical market, and has its stocks listed both in UK and US (O 'Rourke, 2002). The origin of the so called blockbuster model, is partly linked with Glaxo (as it was previously known). In the early 80’s, then Glaxo brought to light their first blockbuster drug, Zantac, which was an anti-ulcer drug, which was very similar to the a pre existing drug Tagamet (first ever blockbuster) sold by Smith Kline & French, their completion at the time (MONTALBAN and SAKINÇ, 2011). The introduction of this drug, brought about an increasing sales force in the US, the company soon became dependent on the drug, because it represented a large part of their profit. In 2002, 8 blockbusters of GSK contributed to $14.240 million sales revenue, taking up 53% of its total ethical sales (Froud et al 2006). However, due to the nature of the pharmaceutical industry, the patent began to expire, in other to avoid the patent cliff, Glaxo merged with Wellcome in 1995, which ensured a growing number of sales force, and with Beecham in 2000 (Froud et al., 2006) this merger, boosted the confidence of investors, by growing the business inorganically. For Big Pharma, this block buster model is very profitable, because with the high cost of R&D, the drugs are able to generate ample profit, to cover the sunk costs

Merck and Co., Inc. was, in 1978, one of the biggest makers of physician endorsed sedates on the planet. Headquartered in Rahway, New Jersey, Merck followed its starting points to Germany in 1668 when Friedrich Jacob Merck obtained a pharmacist in the city of Darmstadt. More than three hundred years after the fact, Merck, having turned into an American firm, utilized more than 28,000 individuals and had operations everywhere throughout the world.

This report provides an analytical strategic review of the global pharmaceutical industry; its origin, evolution,