Scribd Logo
Upload

Welcome to Scribd!

  • 285 views

    4 Ib

    Uploaded by

    Hojol
    GSK is a large pharmaceutical company led by CEO Andrew Witty. During the 2009 H1N1 flu pandemic, GSK profited significantly from selling 195 million flu vaccines, generating $1.3 billion in revenue. While some perceive GSK as profiting from illness, Andrew argues pharmaceutical companies need to profit from pandemics given their large research investments. To balance profits and ethics, GSK plans to charge lower prices in sub-Saharan Africa. Andrew has additional strategies to diversify revenue, such as acquisitions in cosmetics and emerging markets, and collaborations to develop new drugs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    4 Ib

    Uploaded by

    Hojol
    285 views1 page
    GSK is a large pharmaceutical company led by CEO Andrew Witty. During the 2009 H1N1 flu pandemic, GSK profited significantly from selling 195 million flu vaccines, generating $1.3 billion in revenue. While some perceive GSK as profiting from illness, Andrew argues pharmaceutical companies need to profit from pandemics given their large research investments. To balance profits and ethics, GSK plans to charge lower prices in sub-Saharan Africa. Andrew has additional strategies to diversify revenue, such as acquisitions in cosmetics and emerging markets, and collaborations to develop new drugs.

    Original Description:

    Business IB

    Original Title

    4 IB

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    GSK is a large pharmaceutical company led by CEO Andrew Witty. During the 2009 H1N1 flu pandemic, GSK profited significantly from selling 195 million flu vaccines, generating $1.3 billion in revenue. While some perceive GSK as profiting from illness, Andrew argues pharmaceutical companies need to profit from pandemics given their large research investments. To balance profits and ethics, GSK plans to charge lower prices in sub-Saharan Africa. Andrew has additional strategies to diversify revenue, such as acquisitions in cosmetics and emerging markets, and collaborations to develop new drugs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    285 views1 page

    4 Ib

    Uploaded by

    Hojol
    GSK is a large pharmaceutical company led by CEO Andrew Witty. During the 2009 H1N1 flu pandemic, GSK profited significantly from selling 195 million flu vaccines, generating $1.3 billion in revenue. While some perceive GSK as profiting from illness, Andrew argues pharmaceutical companies need to profit from pandemics given their large research investments. To balance profits and ethics, GSK plans to charge lower prices in sub-Saharan Africa. Andrew has additional strategies to diversify revenue, such as acquisitions in cosmetics and emerging markets, and collaborations to develop new drugs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    4.

    GSK
    As the chief executive officer (CEO) of GlaxoSmithKline (GSK), a large pharmaceutical company,
    Andrew Witty is perceived as profiting from the misfortune of others. GSK has profited
    significantly from the H1N1 flu1 pandemic. In 2009, GSK had received orders for 195 million flu
    vaccines and sales revenue from the vaccine in 2010 was US$1.3 billion. Andrew said, If a
    pharmaceutical company cannot make a profit during a pandemic, when can it?. GSK had spent
    18 years and US$3 billion on researching and developing new flu vaccines.
    Although a public limited company, GSKs aim is to balance the need to make a profit with the
    ethical side of health care. On the ethical side, GSK plans to use a price discrimination strategy of
    charging in sub-Saharan Africa, only a quarter of the price charged in British and American
    markets.
    GSK also plans to collaborate with rival companies to research some tropical diseases prevailing in
    developing countries.
    To boost profitability, Andrew has strategies to become less dependent on a few highly successful
    drugs. He plans to:
    extend GSKs product range, particularly in cosmetic products, through acquisitions of
    companies such as Stiefel Laboratories, Inc., an American manufacturer of skincare products
    enter emerging, fast-growing economies by acquiring Dr. Reddys, an Indian generic drugs to
    company
    collaborate with other pharmaceutical companies, such as via a joint venture to develop a
    treatment for AIDS.
    Andrew will also cut costs by US$1.7 billion by 2011, which will result from 10 000 redundancies.
    Notes
    (a) Describe two characteristics of a public limited company. [4 marks]
    (b) Using the concept of price elasticity of demand, explain GSKs pricing strategy
    for its flu vaccine. [6 marks]
    (c) Using the Ansoff matrix, examine one of the strategic options planned by
    Andrew. [6 marks]
    (d) Discuss GSKs aim to balance the need to make a profit with the ethical side of health care.
    [9 marks]

    You might also like