Essay on Pharma Five Forces

2393 Words10 Pages
Team 1:
Homework No. 1 1. I was expecting an innovative name and logo from your team. 2. A very good introduction of the industry. Note ii. The second edition of the textbook (Barney and Hesterly) is copyrighted in 2008. 3. Industry rivalry: use a note to indicate the source when you applied the number (e.g., 25% of the market presence) to support your analysis. 4. Threat of substitutes: Generic brands are more likely to be considered as “competitive” products. Yes, CAM and alternative medicine are substitutes. However, there are many ways to prevent sickness (e.g., a healthy lifestyle). I think there is no “perfect” substitute to treat disease and sickness in most cases. 5. A good discussion on how the five
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It still is not certain that product investment will pay off. When this happens companies can become weak and risk liquidation or being bought out by competitors. With high costs in R&D and marketing, there exists a high entry barrier for this market. This environment makes for rivalry in an environment where only the strongest will survive. However, the government regulates the way companies strategically pair, and that is the common standard in this type of industry. This is done to keep the market competitive in the long run by using companies’ innovation to fuel more competition in the fight for the buyer[iii].
Threat of Substitutes
Generic brand medication is often seen as the main substitute for products produced by the pharmaceutical industry[iv]. Generic brands are a substitute because they keep the prices of brand name medicines competitive. However, generic medicines are not always an available substitute due to patents. Also, it is debatable whether or not generic medicine is really a substitute and not a rivalry. Brand names and generics are the same product delivered to the customer in a similar way. The only major differences are the name and price. Complementary Alterative Medicine (CAM) and alternative medicine are also substitutes for the products produced by the pharmaceutical industry. CAM includes a wide array of healthcare products and practices that are not recognized as being a part of
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