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MGMT 720 Global Strategy and Competitiveness / July 2012
Take-Home Exam
Nicolas Garcia
Global MBA - ICESI
August 5th, 2012
Question:
1. (90 points – Industry Analysis) Alex asks your opinion about the current state of the
pharmaceutical industry. Please help him decide if it is an attractive industry; also please
advise Alex on which capabilities will be critical for his company’s success in the next 3- 5
years.
2. (170 points – Resources and Capabilities) Do you think that acquisition of Star
Genomics would be a good move for Pills? Why or why not? If you recommend the
acquisition, please provide some insights on how Star’s capabilities should be integrated
and deployed. If you recommend against the acquisition, please provide specific reasons
for that and what should Pills do instead.
3. (140 points – Capabilities; Global Strategy) What kind of partnering possibility between
Pills and Breakthrough Genomics do you consider the most beneficial for Pills? Should
Pills consider acquiring BG, or should it consider licensing from BG the intellectual
property of the γ-transmembrane project, or should it enter an alliance or joint venture with
BG, or should they not collaborate at all? Again, try to develop some specific
recommendations; provide arguments supporting your recommendation.
Industry identification - Standard Industrial Classification (SIC) :
2834 Pharmaceutical Preparations
Establishments primarily engaged in manufacturing, fabricating, or processing drugs in
pharmaceutical preparations for human or veterinary use. The greater part of the products
of these establishments are finished in the form intended for final consumption, such as
ampoules, tablets, capsules, vials, ointments, medicinal powders, solutions, and
suspensions. Products of this industry consist of two important lines, namely: (1)
pharmaceutical preparations promoted primarily to the dental, medical, or veterinary
professions, and (2) pharmaceutical preparations promoted primarily to the public.* US
Department of Labor.
Industry Overview
Factors that affect growth
• Investment in research and development R&D
• Company's current and future estimated portfolio - long term stability
• Active participation on alliances, M&A (mergers and acquisitions) and joint ventures
• Drug discovery or design. In the past most drugs have been discovered either by isolating
the active ingredient from traditional remedies or by serendipitous discovery. Modern
biotechnology often focuses on understanding the metabolic pathways related to a disease
state or pathogen, and manipulating these pathways using molecular biology or
biochemistry.* Wikipedia
• Drug development refers to activities undertaken after a compound is identified as a
potential drug in order to establish its suitability as a medication. Objectives of drug
