Page 7 - CIMA SCS Workbook November 2018 - Day 2 Tasks

Chapter 8

STRATEGIC MANAGEMENT (E3)

PRACTICE TASKS

EXERCISE 1

UPDATE

It is early one Monday morning, and you are working at your desk. You receive the following
email:

TRIGGER

Email

To: Senior Manager
From: Dirk Lepain, CEO
Subject: Gaining PRA approval

I have recently received a copy of a report produced by the PRA on its decision to reject Werstra’s
new drug Denovax on the grounds of cost. This is happening more regularly these days, and leads
me to think that we need to take steps to address the issue.

Firstly, I know that we at Novak have always done the same as our competitors and charged a
premium price for new products brought to market. The justification for this is that it costs us
millions in research to develop a new drug, but I’m wondering if we could adopt a different pricing
strategy. Could you please give me some ideas on alternative pricing strategies and their
suitability for our business?

Secondly, I have received an email from an old friend from my university days. He seems to have
done pretty well for himself, and claims that he can help us to improve our chances for gaining
approval for purchase by the PRA for future new products. Could you please read the attached
email and let me know your thoughts on whether we should engage him?

Many thanks

KAPLAN PUBLISHING 23