These categories include pharmaceutical preparations, medicinal and botanical products, biological products, and in-vitro diagnostic substance products. The research, development, production, and sale is completely controlled by the individual companies who manufacture the pharmaceuticals. The market research report titled “Africa Pharmaceuticals Market” by Goldstein Market Intelligence is the comprehensive review of market drivers, trends, opportunities, issues and restraints in addition to This report analyses the Africa markets for pharmaceuticals in USD Million. The pharmaceutical industry includes companies involved in the manufacturing and development of prescription drugs and over-the-counter products that are used to prevent illnesses in humans or animals (Oliver, 2017). J&J’s debt ratio in 2017 was also 0.50 and has remained flat between 2012 to 2017 with an average ratio of 0.47. Between 2012 and 2017, J&J generated an increase in cash from $14 billion in 2012 to $18 billion with 2013 having the most cash during the five-year trend with $20 billion. Some of the more profitable companies that investors may consider adding to their portfolios include GlaxoSmithKline, Pfizer, Novartis, and AbbVie (Ratty, 2017). The lawsuit is the first antitrust action to emerge within the biosimilar drug market and could set a precedence for other companies to sue each other regarding exclusive contracts with buyers (Rockoff, 2017). The industry relies on the advancement of medical technology to develop new drugs for unmet needs. The pharmaceutical industry is currently in the Mature stage (Oliver, 2017). The formula consists of the profit margin, asset turnover, and the equity multiplier. The most recent collaboration was between Merck and AstraZeneca to co-develop and co-commercialize Lynparza® for the treatment of multiple cancers. J&J also decided that the Hepatitis C market would not prove to be a profitable venture and discontinued their drug in early September 2017. Manufacturers focus marketing for the general consumer as well as strategically placing healthcare providers such as Medical Science Liaisons and Drug Representations to communicate with prescribing physicians (Oliver, 2017). Exports of brand name pharmaceutical drugs account for the largest industry revenue segment with 24.7% in 2017. Overall, it appears that J&J is outperforming both Merck and Pfizer in terms of profitability and liquidity. Industry brand names for J&J’s include Remicade®, Topamax®, and Procrit®. The most significant change equity ratio was between 2015 and 2016 in which the ratio decreased from 0.39 to 0.35 due to both an increase in total assets and a decrease in total equity. The production of new drugs will typically have increased prices due to the R&D that was invested into producing the drug. The recent controversies of Turing Pharmaceuticals’ 5,555% price increase of Daraprim® in 2015 and Mylan’s 500% increase of EpiPen® in 2016 were heavily contested during the recent presidential election between Hillary Clinton and Donald Trump (Loo, 2017). Most of the players in the industry have been here for a long time and are well recognized globally. The global pharmaceutical packaging market size was valued at USD 98.58 billion in 2019 and is anticipated to expand at a CAGR of 8.5% over the forecast period. The pharmaceutical industry is one of the most competitive industries in the world. However, both Merck and Pfizer’s net profit margin has decreased. Pfizer’s equity ratio in 2016 was 0.35 and has remained flat between 2012 to 2016 with an average ratio of 0.41 (Table 3c). Although Value Line has noted that the industry is ranked 92nd (out of 97 industries) in regard to timeliness and has experienced falling ratio of industry strength, the sector still contains a strong base of safe, well-established equities with above average income components (Ratty, 2017). In May of 2011, J&J obtained approval for the first new AIDS medication since 2008 (Oliver, 2017). However, as always, there’s some overlap between the Political and Legal categories in PESTLE analysis. Important factors relating to this industry will be the development and analyzation of brand name drugs. The equity multiplier increased between 2014 to 2015 from 2.02 to 2.28 as a result of an increase in total assets and a decrease in total equity. The North American pharmaceutical CDMO market is expected to grow by 6.0% annually in the forecast period and reach $101.1 billion by 2030 … As such, you may wish to interpret the regulatory frameworks of the pharmaceutical industry as a Legal matter, and not a Political one. In US too, the industry is under intense pressures. In most cases, this relates to the health and safety of medications. Typically, the higher the debt ratio, the more likely a company is at risk of solvency. Without the pharmaceutical industry, no life-saving medications would be available to make an impact in the healthcare system. The net profit margin between 2012 and 2013 increased from 16.14% to 19.40% due to an increase in net income and total revenue. An improved workflow is important for business journalists to ensure that they always have their work process smoothened out for them. Mail service retailers account for the second largest industry revenue in the US with 17.3% in 2017. The DuPont formula consists of three primary ratios that are multiplied together to determine a company’s earnings from its assets. Collectively, these companies have 28.8% of the brand name pharmaceutical manufacturing industry’s market share. Another important provider of healthcare (the insurance companies) will maximize profits by refusing to pay for the most expensive drugs while the consumers (patients) typically suffer the consequences of limited drug coverage. The benchmark analysis is used to assess the profitability and liquidity ratios for Merck, Pfizer, and J&J against industry standards. The profit margin between 2013 and 2014 increased from 10% to 28.22% due to a substantial increase in net income as a result of decreased interest expense. The industry has experienced double digit price gains from major companies such as Novartis, Merck, Eli Lilly, and AbbVie (Ratty, 2017). Unfortunately, due to high cost of treatment, up to 20% of cancer patients forego treatment (Oliver, 2017). The most recent event affecting both Merck and J&J was the industry retreat from the production of Hepatitis C medications (Lombardo, 2017). Furthermore, for whatever reasons, average healthcare spend is also rising. Between 2012 and 2016, Merck experienced a 50% reduction in cash from $13 million to $6.5 million as a result of purchasing Cubist Pharmaceuticals (Loftus, 2014). Our website is made possible by displaying online advertisements to our visitors. PESTLE Analysis of the Pharmaceutical Industry, PESTLE Analysis of the Pharmaceutical Industry: Final Thoughts, PESTEL analysis of Pharmaceutical Industry, PESTLE Analysis: Business Environmental Analysis, How Business Journalists Can Streamline Their Workflow, Important drivers to Vietnam’s economic growth, Bangladesh PESTLE Analysis 2021: Challenges and Potential, Johnson and Johnson SWOT Analysis 2021 – Comprehensive …. However, J&J’s operating margin has remained flat. The attempt to repeal the Affordable Care Act will affect 20 million insured patients and will hurt drug sales overall (Loo, 2017). Between 2012 and 2016, Pfizer experienced a significant reduction in cash from $10 million in 2012 to $2.5 million likely as a result of the increased cost of R&D. Pfizer currently has some of the most highly recognizable brand name drugs and have impacted multiple clinical guidelines. The DuPont formula allows an analyst to asses a company’s return on equity (ROE). Multiple factors account for the demand for brand name pharmaceuticals. PESTEL or PESTLE analysis, also known as PEST analysis, is a tool for business analysis of political, economic, social, and technological factors. In recent years, this has caused significant outrage, as many drug manufacturers choose to sell their drugs at hugely marked-up prices. Both Merck (62%) and J&J (68%) have below average gross margins. Overall, the pharmaceutical industry remains to be a profitable industry. Ultimately, this would mean that pharmaceutical companies are left with less profit after all things are considered. The major competitors’ analysis is composed of dominant companies and their position within the brand name pharmaceutical industry. The purpose of this analysis is to assess the financial health and stability of major companies operating in the brand name pharmaceutical manufacturing industry. The most significant change in J&J’s current ratio was between 2016 to 2017 in which the current ratio increased from 2.17 to 2.47 due to an increase in total current assets and more specifically, an increase cash (Table 3d). As a household name brand since 1886, J&J is well established with more than 250 operating segments and over 126,400 employees. The true costs of drug development can be outstanding and without proper return on investment, pharmaceutical companies cannot develop the drugs that may save lives in the future. In the United States, pharmaceutical companies are free to price medications however they want. The Cloud Computing in Pharmaceutical market analysis is provided for the international markets including development trends, competitive landscape analysis, and key regions development status. Merck’s ROE remained flat with an average ROE of 13% between 2012 to 2016 while Pfizer’s ROE trended downward from 18% to 12% between 2012 to 2016. Therefore, the typical consumer will rely on some type of prescription drug coverage. Pfizer’s gross margin remained flat from 2012 to 2016 indicating that the company has been able to generate an average of 79.96% of revenue to pay for COGS (Table 3c). The most significant change in equity ratio was between 2014 and 2015 in which the ratio decreased from 0.49 to 0.44 due to both an increase in total assets and a decrease in total equity. J&J currently has 10.4% of the market share in this industry. The average current ratios of both Merck (1.8 between 2012 to 2016) and Pfizer (1.99 between 2012 to 2016) are well below industry averages and have trended downward. NAICS code 32541 includes companies that operate in (1) manufacturing of biological and medicinal products, (2) processing botanical drugs and herbs, (3) isolating active medicinal principals from botanical drugs and herbs, and (4) manufacturing pharmaceutical products intended for internal and external consumption (United States Census Bureau, 2017). Pharmaceutical With increasing demand for quality healthcare solutions, the pharmaceutical industry is evolving rampantly since past few decades. the pharmaceutical market – and ultimately the R&D base – is likely to shift gradually towards emerging economies. The leverage ratios include the equity ratio and the debt ratio. Indian Pharmaceuticals Industry Analysis: Updated content on market overviews, growth drivers, opportunities and key organisations capturing the dynamism.... October 06, 2019 : Indian Pharmaceuticals Industry Analysis . The top three publicly traded pharmaceutical companies included in this industry analysis includes Johnson and Johnson (J&J), Pfizer Inc., and Merck and Co. Inc. (Oliver, 2017). With continued scrutiny of increased drug prices, many of the major pharmaceutical companies have become more selective with the development of new drugs. Everyday our market is changing the way it is. 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