AstraZeneca Report

This report provides a comprehensive analysis of AstraZeneca, a leading international pharmaceutical company. It includes a PESTLE analysis, Porter's five forces analysis, SWOT analysis, and VRIO analysis. The report evaluates the company's strategies and tactics for achieving scientific leadership. References are also provided.

AstraZeneca Report

Table of Contents
Introduction......................................................................................................................................1
Task 1.....................................................................................................................................1
PESTLE Analysis.........................................................................................................1
Porter's five forces analysis...........................................................................................2
Task 2.....................................................................................................................................4
SWOT Analysis............................................................................................................4
VRIO Analysis..............................................................................................................5
Task 3.....................................................................................................................................6
Evaluation.....................................................................................................................6
References:.....................................................................................................................................12

Introduction
AstraZeneca is one of the leading international pharmaceutical company based in UK in
1999. It offers the products like medications, drugs, researches and many more to serve the
people and hospitals. Its strategy includes the dynamic development via flourishing
commercialized quality and increasing profitableness by managing costs and scaling with
efficiency as they build. Impinging and enhancing the entire patient journey from illness
prevention and screening, diagnosing and treatment through to rehabilitation.
Task 1
PESTLE Analysis
Political factor
 In context of pharmaceutical industry, there is a moderate situation in these factors
because of some reasons such as they face the uncertain issues due to the Brexit incident
in UK and moreover, there is an increased spending on health care products and services
by governments by rendering health care programmes like Obama care and Modi care
(Green, 2018). Hence, it can be said that this factor is an opportunistic as well as threat
also due to both the type of situations positive and negative also, it comes under moderate
condition as per the different external political factors associated with.
Economical factor
 In context of pharmaceutical industry, there is an opportunistic situation in these factors
because of some reasons such as there are various steps taken by the government to lower
drug prices and moreover deteriorating returns on the research and development
department investment in the pharmaceutical industry. This has created the opportunity
for the company to carry on such activities in drugs generation for the benefit of the
people and can supply in the hospitals.
Social factor
 In context of pharmaceutical industry, there is an opportunistic situation in these factors
because of some reasons such as ageing population will lead to greater growth and
opportunities, this results in significant growth in the number of patients that are suffering
from illness which are majorly caused by the urban life style and moreover due to the rise
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in income levels of the families as well. Therefore, due to the need of more medicines
and treatment to old people, adults, youngsters and children and due to the rising in the
income level of the families, company has benefited with such situations.
Technological factor
 In context of pharmaceutical industry, there is an opportunistic situation in these factors
because of some reasons such as there is a good investment in building innovation centre
to promote and boost quality manufacturing in an industry and moreover, there is a good
use of artificial intelligence and tracking systems to aid in drug evolution or discovery by
tackling counterfeits (Phan, 2021). Therefore, using such advanced technology in
innovation and production and serving the people can assist the company and moreover,
updates of technology used can also aid the company in being more digitalised.
Legal factor
 In context of pharmaceutical industry, there is a threat situation in these factors because
of some reasons such as there is a decline in drug approval from the regulatory bodies,
frequent changes made on the tax rates of the nation and moreover, there is an adverse
impact of General Data Protection Regulatory (GDPR) on operation and development of
drugs. Therefore, negativity in this factor can affect the company in loosing the profits
and more expenses in the products and services they are renedering in the market place.
Environmental factor
 In context of pharmaceutical industry, there is an opportunistic situation in these factors
because of some reasons such as they have taken the step to tackle the global climate
change by adopting the strategic leadership styles and roles performed in an organization
so handle out such situation in an effective, efficient and potential manner (Ahmed and
Schippert, 2020). Therefore, step taken by the company can support and help them to get
stability in the market place with better expansion and demand of the products and
services.
Porter's five forces analysis
Threat of new entrants
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 There is a low threat of new entrants for pharmaceutical industry because the
pharmaceutical industry is an expensive one which initially requires the high cost
infrastructure, raw materials and human resources with specialised capability.
 The one who can invest high amount of capital in initiating their business in
pharmaceutical industry can only survive in the market place.
Threat of substitutes
 There is a high threat of substitutes for pharmaceutical industry because the
pharmaceutical industry consist so many companies which produces and offers the
customer similar quality, similar pricing and similar quantity of goods and services by
small scale industries and large scale industries as well.
 So people and retailers can easily switch from one company to another if they find any
better offer from another organization (Bruijl, 2018).
Bargaining power of suppliers
 There is a low bargaining power of suppliers for pharmaceutical industry because the
pharmaceutical industry is one of the branded, leading and most trusted organization
which deals with chemicals, medicines and drugs for the welfare of the people which
operates at international level.
 Therefore, suppliers don't want to loose the dealings with pharmaceutical industry as they
purchase in bulk for high production with the prices offered to them
Bargaining power of buyers
 There is a moderate level of bargaining power of buyers for pharmaceutical industry
because the company is associated with both the factors, one is that it is branded and
good image in the market place and second is competition in the market, so there can be
low as well as high bargaining power of the buyers as per the situations (Mahat, 2019).
Competitive rivalry
 There is a high level of competitive rivalries for pharmaceutical industry because the
pharmaceutical industry consist large number of companies which gives the tough
competition to the pharmaceutical industry such as AstraZeneca, Decipher labs, Daiichi
Sankyo, Boehringer Ingelheim, Sanofi, Novartis, GSK, Amgen and Bayer. Market share
of the firm is 7,287.00 GBX+44.00 (0.61%) up.
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Task 2
SWOT Analysis
Strengths
 This element is considered as the advantages for an organization through which they gain
stability in the market place. Strengths of AstraZeneca are that they have rapid decision
making process and streamlined processing, they have good commercial and research and
development existence in the rising market, they are operating in over 100 countries with
60,000 employees working for them, they are investing high in research and development
department with human resources over 11,000 people in a team, they have ten products
with international sales more than one billion dollar as financial resources and they have
vast and diverse portfolio of products they are offering.
Weaknesses
 This element is considered as the disadvantages for an organization because of which
they suffer in the market place. Weaknesses of AstraZeneca are that they are highly
affected due to the drug shortage crises in case of Cefotan, they have suffered product
discontinuation many a times which has adversely affected their performances and their
image or reputation is affected negatively due to the legal proceedings related to patents
and pricing issues in the organization (Phadermrod, Crowder and Wills, 2019).
Opportunities
 This element is considered as the favourable conditions in an organization through they
have the chances to grow, develop and expand their business. Opportunities for
AstraZeneca are that they can leverage its strong presence in rising market place with its
physical resources, biosimilar market place is increasing very frequently across the
world on a international basis and moreover, ageing population is increasing rapidly day
by day globally.
Threats
 This element is considered as an unfavourable conditions in an organization because of
which company suffers in its productivity. Threats of AstraZeneca are that one of their
blockbuster drug Seroquel is facing threat of copycat generic drugs, drug development
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guidelines are strict and moreover, they are facing high rivalries in an industry mainly in
segment of drugs (Teoli and An, 2019).
VRIO Analysis
Valuable
 Investment resources, people resources, marketing resources and operations resources are
the resources which are valuable for AstraZeneca because they bring a lot of importance
to the firm in generating the profits and goodwill (Hernández and Garcia, 2018).
Rare
 AstraZeneca is required to know that the resources which are valuable to the firm are rare
and expensive to achieve. They must be essentially rare and if they are not then it will be
difficult for the firm to fight against the competitors in the pharmaceutical industry.
Imitate
 This can prove the greatest threat for the firm because other brands who are developing
the medicines and chemicals can easily come up with the duplication of the products
made by AstraZeneca or can easily substitutes the products that can make the competition
even more tougher for the firm to fight in the industry (Chatzoglou, Chatzoudes,
Sarigiannidis and Theriou, 2018).
Organised
 This point measures that how can company can organise their valuable, rare and imitable
resources in an efficient manner. This level of examination for the firm’s products can be
performed in two aspects that are either firm can wholly exploit the potentiality of the
products or it can still have the many upsides. Generally, the potential and exploitation
level is highly dependent on the team and strategies of the firm that made by the leaders.
Therefore, exploitation level is considered good to analyse the quality of the human
resources in an organization. Abilities incline to raise or develop timely as a company
performs actions that are built on their strategic resources.
Resources Value based Rare Imitate Organised
Physical
Resources
Yes No Yes Yes
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Technological
Resources
Yes Yes No Yes
Financial
Resources
Yes No No Yes
Human Resources Yes No Yes Yes
Task 3
Evaluation
Suitability
The following points discuss the suitability of the company in terms of the strategies they
have adopted in their organization:
AstraZeneca’s tactics significance are:
 Carrying out their own market growth platforms so that they can face the patents
associated with them and the declination of revenues
 They are trying to progress the phase II pipeline so that they can double grow the phase
III asset volume in order to diversify the biologics portfolio
 They are slowly launching the care products which helps the company in balancing the
historic strength of primary care (Shtal, Buriak, Ukubassova and Tlegen, 2018).
 Redeveloping the research and development engine via creativity and applied science
based on co-location of their groups and amended accessibility to internationally
identifies science bunches (Mazzetti, Hedwall, Crowther, Lennard, Richardson and
Taylor, 2018).
 Intensely shortening the enterprise, enhancing sales and developing an environment that
assist long-standing succession
 Maximum company growth and development to supply benefit to the firm’s fundamental
scheme and to support the pipeline additionally.
 At the time of investor day briefing, Pascal Soriot and other staff of company’s high
authority leadership sets up the tactic execution scheme (Willigers, 2020).
Achieving scientific leadership
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 Company is associated to implementation a targeted innovation-driven international
products tactics and manipulating their best grouping of firm merits in big and little
particles.
 They are focusing on the research and development efforts made by them. In big and
little particles research and development, they will focus their biological hard works and
the heaviness of their spending, which includes company growth, on Respiratory,
Inflammation & Autoimmunity, Cardiovascular & Metabolic Disease and Oncology
 They will remain to be energetic in Contamination & Injections and in Neuroscience, via
their spending will be additional opportunistic (Remneland Wikhamn and Styhre, 2019).
 In their selected areas of therapy, they will constrict their concentration on diseases. This
method is developed to enhance their successions while permitting them to achieve their
targets of finance, their increasing collection of assets on a widely flat research and
development devote to 2016 (Somers, 2019).
 By Fostering growth of various new molecular entities (NMEs), they trust their Phase III
pipeline has the possibility to dual in scope by 2016. Fostering of such basic resources,
shared with their continues hard works to grow a tough Phase II biologics pipeline into
last phase growth will generate a group which is more biased towards care of specialty,
matching their old-style strong points in basic care. They are also growing their spending
in life cycle operations to assist fundamental on-market and last stage pipeline goods for
example Brilinta, lesinurad, BYDUREONTM and FORXIGATM.
 They will renovate the manner they manage R&D. To support accomplish maintainable
technical headship and enhance pipeline gains, they will redesign their footmark and
change their management ideal. As declared on 18 March, 2013, they will rise their
closeness to bioscience groups and bring their R&D and profitable human resource
collectively in 3 tactic research and development departments. These suggestions will
create it comfortable for their investigators to cooperate with internal as well as external
stakeholders and altogether also. The development of automation biologics and little
particles biotech elements is developed to enhance creativity and fosters decision-
making. Moreover, they will rise their dependence on original biology and modified well-
being and they will remain partnering with foremost educational establishments to gain
their concepts of illness biology.
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 Recent declaration of the association with the Swedish medical university Karolinska
Institute and the contract with Moderna Therapeutics emphasize the firm’s promise to
updated learning of illness physiology, examine fresh drug goals and smear original
therapeutics in their major treatment departments
Internal factors
External factors
Strengths Weaknesses
Opportunities Product portfolio Research and
development
Threats Investments decision Legalities
Acceptability
The following points discuss the acceptability of the company in terms of growth and
development due to the stakeholders help in an organization.
Return to growth
 By increasing the possibility of the resources in their hands, they will cross an era of
profits decrease throughout which some of their main goods are arranged to lost them
exclusively. Via this biological tactic they will seek a return to growth.
 They will target spending and assets on 5 basic development stages: Making sure
that Brilinta spreaded out to the people who can get advantage, storing the multi billion
dollar probable of this essential medication, Employed with their companion, BMS, to
accomplish a important post in the non-insulin diabetes fair, spending to foster
development in their rising market place out of which the China renders the largest
individual chances. They set goals of yearly large individual digit profit development in
their rising market place, increasing the effectiveness of their on-
market respiratory group, which remains to develop in basic market place and foster their
pipeline of respiratory undertakings and storing the effectiveness from their recognized
brands and fresh launches in Japan which is the world’s 2nd biggest pharmaceutical
market which is depicting stable growth.
 There are number of variables given involving the subtleties of the international economy
and administration austerity methods, policies problems and costs burden together with
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the changeover of their own group, they do not consider it is sensible to give a particular
importance or periods for long-standing profits. Dependent on their target spending in
basic development stages and their pipeline, they trust they can essentially surpass
existing market agreement for 2018 profits of $21.5 billion.
 Via fostered company growth, they will search to render benefit to their basic scheme
while assisting their long-standing pipeline goals. There will be an additional powerful
attention to the company growth hard works of their little particles and biologics biotech
elements on initial phases of educational and biotech associations. They will remain to in-
license to reinforce the pipeline, targeting predominately on the 3 basic treatment
departments, while they will search for companies and bolt-on attainments to help the
late-stage and on-market group to foster profits.
Simplification and productivity
 Renovating how they effort is vital to bringing their tactics. They are dedicated to
intensely shortening their company and their procedures, while generating a creative
surroundings. Co-location on an additional target footmark will assist that goal as will be
growing independence to quicken and progress judgement making.
 They will remain to motivate gains enhancements in the firm, eliminating difficulty and
making extra headroom to spend in rising their company and making sure returns to their
bondholders.
 Recently they are declaring rearrangement of their SG&A actions that will direct to a
international decrement in number about 2,300. The widely held of this number affection
is associated to events previously connected to impacted workers.
 They are joining this SG&A reforming with 2 earlier declared events. These consist the
number of decrement of 1,600 associated to the planned research and development
footmark modified declared on 18 March, 2013 and the equilibrium of the Phase III
rearrangement event declared in February, 2012, which quantities to 1,150 purposes. The
entire joined Phase IV event involves an approximate international number of decrement
of around 5,050 above the 2013-2016-time period.
 The joined event of modifications is approximated to experience $2.3 billion in former
rearrangement fees to the profit and loss of which $1.7 billion are predictable to be cash
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in hand expenses. Reimbursements of about $800 million per year are predictable by
2016.
High Level of Interest Low
Level of Power
Low
Investors Customers
Competitors Employees
Feasibility
The following points discuss the feasibility study of the company in terms of financial
resources in an organization.
Financial objectives and capital allocation
 At the time of briefing the investor day, they will analyze their fiscal targets and wealth
sharing strategy, including: Upholding robust basic pre-research and development
limitations with a goal scope of 48% to 52%, A probability that up to 50% of the post-
tax, pre-research and development money flow from their on-market group will be
invested in research and development, exterior partnerships and in-licensing, also wealth
spending, A promise to uphold their advanced bonus strategy below which they grasp or
develop the bonus per share with a goal cover double major incomes above the spending
cycle, Assigning the equilibrium of money flows to reserve extra value-creating company
growth and bolt-on attainments.
 As earlier specified, in accepting a liberal bonus strategy, by which the Board aims to
uphold or develop the bonus per annum, company’s Board identifies that nearly incomes
variations are to be predictable as the income dependent changes via time of
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exclusiveness losses and fresh goods presentations. The Board’s opinion is that the yearly
bonus will not only reproduce the fiscal execution of a particular year taken in separation,
but also reproduces its opinion of the incomes forecasts for the Cluster over the total of
the asset rotation.
Long-term incentives
 The firm is suggesting to evaluate its long-standing enticement presentation metrics to
increase arrangement with the tactic of recurring to development and accomplishing
technical leadership. The firm’s Payment Group will check the team’s biggest investors
about its thoughts in this zone beforehand any extended term pay awards are made in
2013 and will take those opinions into explanation beforehand its ultimate judgement.
More data about fresh presentation metrics would be made obtainable at the firm’s AGM
(Nord, Ysander, Sullivan and Patel, 2021).
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References:
Books and Journals
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Chatzoglou, P., Chatzoudes, D., Sarigiannidis, L. and Theriou, G., 2018. The role of firm-
specific factors in the strategy-performance relationship: Revisiting the resource-based
view of the firm and the VRIO framework. Management Research Review.
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Management.
Mazzetti, M., Hedwall, M., Crowther, M., Lennard, S., Richardson, M. and Taylor, L., 2018,
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Institute.
Nord, M., Ysander, M., Sullivan, T. and Patel, M., 2021. Practical considerations for creating a
strategic and proactive clinical safety and pharmacovigilance organization for the
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Remneland Wikhamn, B. and Styhre, A., 2019. Managerial challenges of outbound open
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Shtal, T., Buriak, M., Ukubassova, G. and Tlegen, T., 2018. Methods of analysis of the external
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Teoli, D. and An, J., 2019. SWOT analysis.
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pharmaceutical company, AstraZeneca. Journal of Business Analytics. 3(2). pp.122-137.
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