Dear Colleagues! This is Asrar Qureshi’s Blog Post #635 for Pharma Veterans. Pharma Veterans welcome sharing of knowledge and wisdom by Veterans for the benefit of Community at large. Pharma Veterans Blog is published by Asrar Qureshi onWordPress, the top blog site. Please email to email@example.com for publishing your contributions here.
February 2022 marked my completing 47 years of working in Pharma Industry. Allah be praised. I am still working. My journey of near half century is also the journey of Pharma Industry in Pakistan. Great changes have occurred in this time and a lot could be written about it. In my blogs, which were started about four and a half years ago, I have covered several topics related to Pakistan Pharma Industry. This multi-part series shall do and review the SWOT – Strengths, Weaknesses, Opportunities, Threats – of the Pharma Industry.
It is now time to strategize, as this was the purpose of this long exercise.
Strategies are made on these parameters:
- Strategies based on Strengths
- Strategies to mitigate Weaknesses
- Strategies to exploit Opportunities
- Strategies to avert Threats
We shall follow the same line of thinking. We have completed Strategy Recommendations based on Strengths and Weaknesses.
Strategies to Exploit Opportunities
- Going Public – It is curious that the Local Pharma is not keen to go public. Except companies like Ferozesons and Highnoon, the companies who are much bigger than these are not interested in going public.
- There are advantages and disadvantages of going public. The biggest advantage is that the company can raise big amounts of cash fast. This cash can be utilized for facility improvement, for expanding business, and for investing into other areas of business.
- The other advantage is the publicity that the company gets through the process. Lots of people get to know the company name and its standing. It will directly create a favorable impression among customers and consumers.
- Going public takes the company out of the hands of the initial investors and into the public. This will increase the longevity of the enterprise.
- Going public will bring more formality is functioning and reporting and turn the enterprise into a formal organization.
- The disadvantage may be the cost of the process, the audit, the underwriting, the IPO – Initial Public Offering. For smaller companies, these may be prohibitive.
- Another disadvantage is the loss of control by the original owners. Possessive as we are, it is difficult for us to let go of control from our hands.
- Our enterprises are run on adhoc basis where decisions are made arbitrarily and at the whims of the owners. Leaving this privilege may be tough.
- There is a common tendency that the owners keep taking out money from business whenever they desire. This privilege shall also be gone.
- Pharma business is run like any other business. Being a public health matter, is no consideration for cutting corners and saving money to maximize profits. Some of this may change.
- The sum up is that the top Pharma companies should consider going public. It will change their profile; it will also change the Pharma market profile. Smaller companies may not consider this option.
This completes the series of strategies to exploit opportunities.
The single most important factor that affects Local Pharma is that majority of the owners have basic minimum education. While they may be shrewd businessmen, they do not know much beyond running it like a business, any business. Pharmaceutical business has gone much beyond ordinary business. In fact, most businesses have been so. The Pharma business needs technical understanding of the trends in medical treatment, pharmaceutical innovations, and pharmaceutical research. It is no more the same as making conventional tablets and capsules. This is another reason why the distance between the employee management and entrepreneur is getting wider. They are unable to understand each other’s views.
Lately, some more qualified children have joined the enterprises, but two problems are common. The first generation does not give them freedom at all to do anything new. They insist that they must perpetuate the old traditions. Secondly, the new generation has also not done any enterprising thing.
Another ironic fact used to be that the pharmaceutical units established by the Pharmacists forty, fifty years ago used to be among the worst units, there are many even now which are not up to mark. Of all the people, the pharmacist should have known the most about establishing and running a pharma unit, but they took advantage of their relations among regulators and got away with many shortcomings. Couple of doctors have also ventured into Pharma manufacturing and their units are also among the lower category. So much for the education and its impact on Pharma business.
Next, we shall take up the strategies to avert threats and risks.
To be Continued……
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