A Qualitative Examination of Pharmaceutical Business Service ...

Outsourcing Pharmaceutical Services

Over the last ten years outsourcing has become a vital strategic matter for Pharmaceutical companies. The eternal rising pressure to reduce costs and time-to-market has resulted not only to the outsourcing of traditional non-core functions, but also increasingly of technical expertise demanding spheres such as drug discovery and development and biotech R&D.

Till the year 2005, countries in Eastern Europe possessed the most dynamic and established infrastructure for the outsourcing of pharmaceutical services, however, during the same period the local pharmaceutical industries in China and India were also making progress at a quick rate and in the recent years, the plethora of pharmaceutical services offered by the CROs has widened greatly to include core-functions such as development of technology that enable R&D (Business Insight, 2008).

The main factor that drives a Pharmaceutical company to outsource its services is the pressure to sustain competitive advantage in the market and one important factor for gaining this competitive advantage is innovation of new products at regular intervals and introducing them in the market at the right moment. The required expenditure on R&D so that they can generate new products at regular intervals, has risen dramatically in the last few years. The fig 2.8 shows the U.S. R&D spending against the new drugs that were approved. Outsourcing services to suitable destinations brings down the cost of manufacturing new products and at the same time enables the quick transfer of drugs from the factory to the market.

However, outsourcing services is one thing and finding an outsourcing destination that will best suit the requirements of the company is another. Apart from the outsourcing powerhouses like India and China, more new and attractive outsourcing destinations are coming up like South East Asian countries, North Africa and the latest and one of the most attractive region to join the list is the Middle East nations. Therefore, an academic survey was conducted to understand which outsourcing destination was most favored by the international pharmaceutical companies.

Methodology

The main objective of this academic survey was to get first hand information from the people working in pharmaceutical services oriented MNCs and MNEs in countries other than the Middle East, and on their views about ?an ideal destination for outsourcing services?. According to this methodology, first a questionnaire was designed according to the demands of the research paper, and then the questionnaire was distributed amongst prospective participants. After the distribution of the questionnaire, a period of one month was scheduled for the responses to come in. The responses were then collected in the form of primary data in the course of the stipulated period of time. The primary data was then analyzed and the results and conclusions were formed accordingly.

Questionnaire

First, a questionnaire was designed such that it was relevant to the research. While formulating the questionnaire the following points were kept in mind:

• To include as few questions as possible.
• Framing the questions in a simple and a straight manner.
• Listing the questions in a logical sequence and
• Avoiding the inclusion of highly personal questions and if some necessary, it should be listed at the end of the questionnaire.

The questionnaire included questions, the answers to which would be helpful in determining whether the European and American pharmaceutical companies saw the Middle East as an attractive outsourcing destination.

Distribution of Data

Distributing survey invitations to all the major European and American Pharmaceutical companies was thought to be highly improbable, complicated and time consuming as well. Therefore out of the many multinational pharmaceutical companies, 3 companies were chosen at random. One was an American company- Johnson & Johnson, the second one was the British GlaxoSmithKline and the third being the Swiss Novartis.

A total of two hundred survey invitations were distributed via e-mail to each of these companies targeting a two hundred employees each belonging to senior management levels. Altogether six hundred employees were invited to participate in the survey, each of them working for the chosen three pharmaceutical companies. In course of a month (the stipulated time for the collection of data), out of the six hundred invitations, questionnaires were forwarded to 414 employees, the response rate of the survey that amounted to 63% indicated that the questionnaire was successful in grabbing the attention of the invitees.

Collection of Data

The number of responses that the survey was able to generate was very encouraging. More than 50% of the invitees had filled in the questionnaire and forwarded it in the course of a month. All the response data of the questionnaire was collected via e-mail itself within the stipulated time frame. All the collected data were then filed into 3 different categories according to the company from where the responses came. This categorization of the responses would later help in the statistical analysis of the primary data in relation to each pharmaceutical company.

Out of the 314 questionnaires that were forwarded in the course of 30 days, the majority of the respondents were from Johnson & Johnson with a total of 124 responses, followed by the British GlaxoSmithKline with 101 responses and the remaining 89 coming from the Swiss Novartis. Accordingly, the primary data availed through the administering of the questionnaire were analyzed and evaluated and then conclusions were drawn.

Source: http://mbatermpapers.com/a-qualitative-examination-of-pharmaceutical-business-service-outsourcing-part-ii/?utm_source=rss&utm_medium=rss&utm_campaign=a-qualitative-examination-of-pharmaceutical-business-service-outsourcing-part-ii

james arthur ray james arthur ray elisabeth shue avastin avastin robert wagner robert wagner