1.0 PHARMACEUTICAL INDUSTRY ? BUSINESS RISKS
?In 2002 the global pharmaceutical industry generated over 400 billion dollars in revenue and invested roughly 16% of that amount, or 40 billion dollars, into research and development for new drugs'
(Taken from http://individual.utoronto.ca/adamlewinberg/Access/Box4.htm - Overview of the pharmaceutical industry)
The industry's business, developing human therapeutics, means risk management must be front and centre of operations across the board, from assessing the benefits and risks of a product for the patient to the risks associated with the development and marketing of a drug.
?Companies have to pay attention to FDA guidance's recognising that the guidance's are addressing different areas of risk'
(Quote by Frances Nolan ? Report by Elisabeth Pena ? Business Risk - 2004)
Business risks are evident in every industry in the world. Companies are continually working and evolving their strategies to overcome obstacles put in their way in order for maximum efficiency and performance.
To explain the risks to AstraZeneca I will use the PESTLE analysis tool.
This analysis is an acronym for Political, Economic, Social, Technological, Legal and Environmental.
I will begin briefly though with the financial risks for AstraZeneca in the pharmaceutical industry. There are two main financial risks Credit Risk and Liquidity Risk.
Credit Risk is:
?The risk that a counterparty will not meet an obligation when due, and will never be able to meet that obligation for full value. The bankruptcy of a counterparty is often associated with such difficulties, but there may be other causes as well'
(Definition taken from http://riskinstitute.ch/1 ...