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Business Analysis of Teva Pharmaceuticals

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PROBLEM STATEMENT
Teva Pharmaceuticals, the firs multinational pharmaceutical company of Israel had become a successful global giant in the industry of generic drugs. After experiencing a long period of success and growth in the generic drug industry against some big western pharmaceuticals the company had acquired many well known pharmaceutical companies and had achieved its goal of 1 billion dollar theory seemed to be in troubles in building a new strategy and vision to compete with the rapidly growing generic industry. They confronted two big issues as key hurdles in their way.
 Many new players entered to the market copying the same techniques for growth like Teva to capture a significant market share by offering low prices due to their low cost strategies. The entry of these players made the industry intense with tough competition, low profit margins and collapsed prices.
 The segment of drug industry where Teva had to come up with innovative drugs demands to invest high capital on R&D that was in billions for a single drug could potentially lower the growth and revenues for Teva and could push the company in serious troubles.
Analysis
To build some effective and real world alternatives and recommendations to Teva Pharmaceuticals we would conduct following analysis to understand external and internal situation of the company.
Internal and External Analysis
SWOT Analysis (Exhibit 1)
Strengths: Teva had a strong customer base because of its presence in 50 countries globally and had acquired 14 very competent companies. The company had a reputation of world’s #1 generic drug company with substantial market share. The company’s portfolio was really strong with about 1300 molecules in generic drugs and had the patent of bloc...

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... Compared to other big players in the market, Teva has a small and weak R&D department and for future goals and actions it is necessary to outspend on R&D which means a huge capital investment that may lead Teva from its core business.
For commodity generic drugs, Teva has an opportunity to expand its core business into emerging markets, but there it will have to face institutional voids because such markets are driven by physicians and both physician and other people are not aware about the effectiveness of generic drugs. To cope with the challenge of institutional voids Teva have to look for some competent small pharmaceutical firms for acquisition and some big firms for the joint venture. For changing the perceptions of people and physicians, Teva will require to run marketing campaigns and direct approaches to physicians to develop a market for their products.
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