Porter's Five-Force Analysis Case Study Example | Topics and Well Written Essays - 1250 words

Porters Five-Force Analysis - Case Study ExampleThe offset pigment external environmental issue in the PHARMAC shimmy study is the importance of regulatory agencies and authorities. From the case study, three advisory committees are identify as the disclose regulatory factors. The Consumer Advisory Committee (CAC), the Pharmacology and Therapeutics Advisory Committee (PTAC), and the Cancer Treatment Sub Committee (CatSop) are all identifies as the key factors (Koster, Erakovic and Smith). These committees are the advisory boards to the various elements of the external environment and the ending-making organs of PHARMAC. The other key environmental factor identified is the political factor in the operations of PHARMAC. The decision that PHARMAC made approving the nine-week trial Herceptin drug reflects the influence of vested shareholder interests in the decision-making process. The political element is particularly important for this analysis because of the vested interests of the parties. Roche industries can be identified as having some political influence on the analysis and the decision-making process. Porters Five-Force Analysis An analysis of the case study can also be done using Porters five-force analysis, which is used to determine every facet of the organization ranging from the profitability to the competitive affright and power of the manufacture (Porter, 1998). The first part of the five-force analysis is the nemesis of new entrants into the industry, a factor that is deemed to increase the intensity of competition. From the case study, it can be concluded that there is no threat of new entrants into PHARMACs industry because it is a government sanctioned advisory agency. An analysis of the second element in Porters five-force analysis is focussed on the power of suppliers, who, in this case, are identified as the drug company Roche. The case study indicates that the supplier of Herceptin had exceptional power in the market place therefor e, the bargaining power was relatively high. The third factor of Potters five-force analysis is the bargaining power of buyers, who, in this case, are identified as the stark naked Zealand population and the regulatory and advisory agencies. An analysis of these buyers indicate that they have relatively low power compared to the suppliers, hence the decision to fund the nine-week trial of the drug Herceptin. The threat of substitutes is also considered in the same way as the threat of new entrants. In the financial support process of new drugs, the case study indicates that PHARMAC and MedSafe are the unproblematic considerations therefore, there is no credible threat of substitutes. The competitive rivalry within the industry, the last factor of the industry analysis, indicates that the various factions in the funding and approval industry have different bargaining powers. The drug industry is very costly therefore, the different competitors in the industry are identified to nee d massive amounts of funding to succeed. The case study also indicates that the slender success factor in the industry is consultation and good relations between the key players in the industry. The case study reveals that PHARMAC made its decision to fund the limited trial period for Herceptin based on a cost-benefit analysis. The success of the decision-making process could have been varied if the dissolute had decided to perform prior consultation with the stakeholders. This can also be supported by the success of the drug in other countries and regions. The main critical success