Strategy Diversification Divested: Productivity measurements, Divestment of non-core assets resulting in healthy Cash position- Will accelerate Next wave of targeted acquisition In the recent years’ several new therapies have been approved in the area of diabetes (SGLT-2, GLP-1 agonists), Multiple Sclerosis, HCV, melanoma,
Novel mechanisms like anti-PD1, anti-PCSK9, and CDK inhibitors have also got exclusive attention by large-cap Pharma companies. Most companies are in a
But for a few companies, patent expiry impact continues to haunt the top-line and they are finding it difficult to replace declining sales with Proprietary pipeline products. Beyond 2013, the impact of patent loss will further aggravate the revenue decline. They have chosen strategies of prioritization pipeline assets, cost efficiency measures, divestment of non-core assets which yield poor margins and increase focus on therapy areas where they have already proven its mettle. Increase in dividend payout and share repurchase are some
Gain in financial strength through divestment of non-core assets (OTC, Animal Health, Consumer health, Diagnostics) will be utilized in pursuing opportunities in high margin therapy areas. At the same-
Going forward, Economies of Scale will also play a major role in swapping the non-core business among major pharma including Vaccines, OTC and animal health to improve margins.
Global Pharma continues to remain attractive due to management efforts on the restructuring of entire business model, cost efficiency measures, de-consolidation, acquisition of high value targeted assets, share repurchase program and dividend policy.