1. STRATEGIC MANAGEMENT 1 Irina Raynaud Pierre Jean Tessier Nicolas Cabrit Clément Tumoine

2. PESTEL Political - Government are powerful purchasers - Government price control - Different coverage and reimbursement systems between countries Sociocultural - Average life expectancy increased by over 20 years - Consumers are well informed thanks the to the easier information access (internet) - Social coverage are different in many countries - No-profit basis operation in order to help undeveloped countries Economic - 1960’ s pharmaceutical industry prospered (light regulatory control) - 80% of the market is owned by 5 countries (USA, Japan, EU, China and Mexico) - Blockbuster power - China and India = attractive countries for global manufacturing and RD investments - Sales and Marketing important part in competitive advantage - 1990’s economic recession 2

3. Technological - R&D is more efficient => importance of the innovation - New type of industry based on new projects: biotechnology - Speed of technologic transfer in developing countries Legal - Tighter regulatory control since thalidomide issue - Legislation set a fixed period on patent protection : 20 years from initial filling - Creation of institutions in order to regulate the international regulation harmonization (EMEA in Europe, International Conference Harmonization in USA, Food and Drug Administration) - Medicare reform in 2006 (drug coverage for elderly people) - Legislation proposition about allowing generic imports and branded drugs in South Africa Environmental - Biopharmaceutical takes a more important place and become mainstream( many companies invest in this new sector) 3

4. Key drivers : - R&D - Sales and Marketing - Arrival of new pharmaceutical sectors: generics, biotechnologies, OTC medicines (force companies to invest and innovate) - Blockbusters Major trends: - Conglomerate companies (mergers and acquisitions) - Pharmaceutical companies manage to be both creative and efficient (by increasing R&D power) - The latest trend : invest in biopharmaceutical area 4