Page 7 - CIMA SCS Workbook November 2018 - Day 1 Suggested Solutions
P. 7
SUGGESTED SOLUTIONS
EXERCISE 3
Strengths
Listed company, therefore has access to capital markets for raising finance.
Global operator meaning lower business risk as not dependent on just 1 market
Manufacturing presence in 10 countries, therefore closer to markets/able to benefit from
lower costs of production/more likely to gain approval for drugs from host government
authorities
7th largest operator globally by revenue, therefore a powerful player in the industry
History of developing many successful pharmaceutical products which makes the medical
profession pay attention to any new products from Novak
2 research centres, each with skilled staff and the very latest equipment
Stated commitment to the highest standard of ethics; should help gain approval for new
products
Reputation for being highly innovative which helps attract high-quality research staff
Novak has been at the forefront of new technologies such as genetic engineering and new
delivery technologies
History of expansion through both organic growth and by acquisition; experience in
purchasing other companies reduces risk of future such strategies failing
Confidence that 3 new products will be launched shortly, each of which will potentially
generate significant revenues and profits
One of the company’s most successful antibiotics, Mintac, has 8 years of patent protection
still remaining
High profit margins e.g. Mintac has margin of 98.5%
Executive Directors are all well-qualified in the pharmaceuticals industry or associated areas
(e.g. Director of Legal Affairs has specialised in intellectual property disputes)
Novak patented 98 new compounds during the year to 31.12.2017, suggesting good R&D
pipeline
Novak gives formal training to health workers in developing countries, resulting in patients
receiving access to care and advice and improving Novak’s reputation as a responsible
pharmaceutical company
Extensive support is given to healthcare workers in a number of ways, thereby increasing
the company’s brand recognition in the medical profession
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