Climate: 25-40 degrees Celsius, little seasonal variation



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Country Overview: Brazil

Geographical Location:

Country Size:

  • 8,515,767 km²

  • Covering 43% of South America

Population:

  • 200,674,130 people

  • 5th largest population in the world

  • Population growth is 0.9%

  • Regional population (Top 3):

  • Sao Paulo population: 11,244,36 (5.6%), density: 7,216.3/km2

  • Rio de Janiero population: 6,323,037 (3.15%), density: 4,781/km2

  • Salvador population: 2,676,606 (1.7%), density: 3,791.2/km2

  • Population density (Top 3)

  • Fortaleza: Population: 2,551,806 people, 7,587.68/km2

- Ceará: 8,606,005 people, 7216.3/km2

- Belo Horizonte: 2,475,000 people, 7290.8/km2



  • Total Life Expectancy: 73.35 years

  • Male Life Expectancy: 69.82

  • Female Life Expectancy: 77.05

  • Ethnic Groups: 99% referred to as Brazilian, remaining 1% are indigenous peoples

  • Demographics:

  • Children (0-14): 25.5%

  • Adult/Labor Force (15-64): 67.5%

  • Elderly (65+): 7%

Economics:

  • GDP (2012): 2.254 Trillion USD

  • GDP Growth (2012): 0.9%

  • GDP Per Capita (2012): $10,958 (IMF)

  • Foreign Direct Investment (2012): $65 Billion USD

  • Wealth Distribution:

  • Top 10% of the population earn 40% of the country’s income

  • Bottom 10% of the population earns 0.9%

  • 21.4% of the population live below the poverty line

Government:

Education:

  • Education is regulated by the Federal Government through the Ministry of Education

  • Composes 5.08% of the GDP (2009), grew from 4.3% in 2006

  • Pre-School is optional

  • Education is mandatory for children ages 6-14

  • Secondary education is mandatory for those seeking higher education (University, college, etc.)

  • Literacy rate (as of 2006): 90.2% of those 15 years or older

Language:

  • Lusophone (Portuguese): spoken by 99% of the population

  • Minority languages include indigenous languages and languages brought in by European and Asian immigrants

Religion (as percent of population):

  • Roman Catholicism: 64.6%

  • Protestantism: 22.2%

  • Non-Religious: 8%

  • Other: 5.2%

Country Overview: India

Geographical Location:

  • South Asia

  • Microclimates based on location:

  • Alpine tundra (North)

  • Humid, Tropical Rainforests (South West)

  • Desert (west)

  • Varying microclimates based on region

  • Four distinct seasons


Country Size:

  • 3,287,590 km²

Population:

  • 1,270,272,105 people (1.27 Billion): Second most populous country in the world

  • Males: 655,875,026

  • Females: 614,397,079

  • Ages 0-25: 50% of India’s population

  • Population growth: 1.3%

  • Regional population leaders (Top 3):

  • Uttar Pradesh: 199,581,477(16.49%)

  • Maharashtra: 112,372,972 (9.28%)

  • Bihar: 103,804,637 (8.58%)

  • Rural population is much greater than the urban population in these areas

  • Population density (Top 3):

  • Titagarh population: 124,213 people (0.0098%), density: 38,337 /km²

  • Baranagar population: 248,466 people (0.0196%), density: 35,220 /km²

  • Serampore population: 197,857 people (0.016%), density: 33,649 /km²

  • Total Life Expectancy: 70 years

  • Male Life Expectancy: 67 years

  • Female Life Expectancy: 73 years

  • Demographics:

  • Children (0-14): 30.8%

  • Adult/Labor Force (15-64): 64.3%

  • Elderly (65+): 4.9%

Economics:

  • GDP (2012): 1.875 Trillion USD

  • GDP Growth (2012): 3.2%

  • GDP Per Capita (2012): $1,414 (IMF)

  • Foreign Direct Investment (2012): $27.3 Billion USD

  • Wealth Distribution:

  • Top 5% of the population earn 38% of the country’s income

  • Bottom 60% earn 13% of the country’s income

  • 32.7% of the population lives below the poverty line

Government:

  • Union/Central Government system

Education:

  • Education is controlled by three levels: central, state and local

  • Education is under the control of the Union Government and the State Government(s)

  • Composes 3.2% of the GDP (2011) goes towards education, a decline of 0.1% from 2010

  • Mandatory schooling: ages 6-14

  • Literacy rate: 66%

  • 72% Male literacy

  • 58% Female literacy


Language:

  • Official languages: Hindi and English

Religion (as percent of population):

  • Hinduism: 80.5%

  • Islam: 13.4%

  • Christianity: 2.3%

  • Other: 2.8%

Industry Overview: Pharmaceuticals

http://www.britannica.com/EBchecked/topic/1357082/pharmaceutical-industry

The pharmaceutical industry, involves the discovery, development and production of drugs and medications to combat disease and illness. Drugs and medicines are produced by both public and private organizations.

Main Players:


  • The major pharmaceutical companies are located in the USA, the UK, Germany, France and Switzerland (Annual revenues of over $33,000M)

  • USA: Phizer, Merck & Co., Johnson and Johnson

  • United Kingdom: GlaxoSmithKline

  • Germany: Bayer

  • France: Sanofi

  • Switzerland: Novartis, Hoffmann–La Roche

Industry Regulations:

  • In the USA, new drugs must be approved by the Food and Drug Administration (FDA)

  • FDA Criteria: Drug must be safe and effective

  • Once approved, the drug moves to clinical trial

  • Patents are used either for the drug itself or the production process of the drug. These last approximately 20 years

SWOT: Pharmaceutical Industry

Strengths:

  • Physical resources: machinery, laboratories, equipment

  • Diversified product line (various drugs/medications)

  • Human capital: experienced research staff

  • Low operating overhead

  • Low staff turnover

  • High return on investment (ROI)

Weaknesses:

  • Physical resources: equipment failure, dated equipment,

  • Human capital: low staff involvement, disengagement

  • High transaction costs

  • Opportunity costs of production

  • High risk (success or failure of product)

  • Poor branding: lack of customer involvement

  • Economies of scale: increased per unit costs

Opportunities:

  • Reducing carbon footprint

  • Emerging new markets

  • Create new drugs with new research

  • Technological developments and more efficient mean of production

  • Target market: increase in health conscious consumers on the global scale

  • Increased demand for pharmaceutical products

  • Expand supply chain to new regions

Threats:

  • Environmental factors or factors outside of the industry’s control

  • Increased Government regulation: patents, import and export, duties and tariffs to various regions

  • Declining economy (based on region)

  • Increasing research and development costs

  • A decreasing global population

  • Products are at high risk of imitation

  • Varying expenses: raw materials, labor, opportunity costs, etc.

Market Overview: Brazil & India

The global pharmaceutical market is focusing its attention towards emerging markets, such as Brazil and India. From 2010-2015, the Brazilian pharmaceuticals market is forecasted to increase by 67.2% ($28,005.1 Million). The Indian pharmaceuticals market is expected to increase by 86.8% ($20,334.4 Million) in the same five-year span.



Growth Potential: Brazil

  • In 2010, the Brazilian pharmaceuticals market created revenues of $16.7 billion. A 10.8% compounded annual growth rate occurred between 2010-2015.

  • It is evident that there is definitely room to grow in this emerging market

Growth Potential: India

  • The performance of India has decreased from 2010-2015, 13.3% ($10.9 billion) when compared to a compounding annual growth rate of 17.5% ($20.3 billion) during the 2006-2010. Although the compound annual growth rate has decreased, total revenues have almost doubled since the 2006-2010 time period.

Regulations: Brazil

  • Regulated by the Brazilian Health Ministry, through its National Health Surveillance Industry (equivalent to USA’s FDA)

  • Five Main Categories of Pharmaceuticals: Normal medicines, Red Stripe medicines, Red Stripe Psychoactive medicines, Black Stripe medicines, Yellow A-Form Prescription medicines

Regulations: India

  • Pharmaceuticals are regulated by Central Drugs Standard Control Organization (CDSCO) under the Ministry of Health and Family Welfare

  • Regulated through the DCGI, Drugs Control General of India

  • Retail and Distribution: Five different distribution categories

  1. Schedule X Drugs: Narcotics

  2. Schedule H and L: Injectables, Antibiotics, Antibacterial

  3. Schedule C and C1: Biological products (vaccines, serums, etc.)



Porter’s Five Forces: Brazil & India
screen shot 2014-03-30 at 7.00.28 pm.png

Information gathered from Industry Profile: Pharmaceuticals in Brazil and India, by DATAMONITOR, have concluded that both the Brazilian and Indian markets share the same level of strengths and/or weaknesses when looking at Porter’s Five Forces. To further solidify this, the criteria used in the breakdown of each of the five forces are identical as well. Based on the criteria displayed in the graphic above, we can see that there is a presence of buyer power but is not overwhelming, there is some degree supplier power, there is a degree of competitive rivalry, the threat of substitutes is high within the industry and the threat of new entrants is low.



NOTE: Using the grading system as seen above (weakstrong / 1-5)



Buyer Power

  • Buyer independence (Strong: 5)

  • Low-cost switching (Strong: 4)

  • Buyer size (Strong: 4)

  • Tendency to switch (Strong: 4)

  • Financial muscle (Medium: 3)

  • Price sensitivity (Weak: 2)

  • Price sensitivity (Weak: 2)

  • Undifferentiated product (Weak: 2)

  • Backwards integration (Weak: 1)



Supplier Power

  • Importance of quality/cost (Strong: 5)

  • Player independence (Strong: 4)

  • No substitute inputs (Strong: 4)

  • Differentiated input (Medium: 3)

  • Switching costs (Medium: 3)

  • Supplier size (Medium: 3)

  • Threat of oligopoly (Medium: 3)

  • Player dispensability (Weak: 2)

  • Forward integration (Weak: 2)

Rivalry

  • Competitor size (Strong: 5)

  • Ease of expansion (Strong: 4)

  • Lack of diversity (Strong: 4)

  • Low cost switching (Strong: 4)

  • Similarity of players (Strong: 4)

  • Storage costs (Strong: 4)

  • Low fixed costs (Medium: 3)

  • Number of players (Medium: 3)

  • Undifferentiated product (Weak: 2)

  • Zero sum game (Weak: 1)

Threat of New Entrants

  • Market growth (Strong: 5)

  • Low cost switching (Strong: 4)

  • Accessible suppliers (Strong: 4)

  • Accessible distribution (Strong: 4)

  • Scale of production is unimportant (Medium: 3)

  • Low fixed costs in operations (Weak: 2)

  • Undifferentiated products (Weak: 2)

  • Weak brands (Weak: 1)

  • Little intellectual property involved (Weak: 1)

  • Little regulation of industry (Weak: 1)

Threat of Substitutes

  • Beneficial alternatives (Strong: 4)

  • Low cost switching (Strong: 4)

  • Cheap alternatives (Medium: 3)



Brazilian Pharmaceuticals Market Share (%) by value: 2010

screen shot 2014-03-30 at 8.17.50 pm.png

  • Novartis, the market leader, has captured 9% of the Brazilian pharmaceuticals market (2010)




  • GlaxoSMithKline, United Kingdom industry leader has a 7.4% market share (2010)




  • 73.2% of the market is distributed amongst other companies. All of which hold smaller market shares


India Pharmaceuticals Market Share (%) by value: 2010
screen shot 2014-03-30 at 8.46.11 pm.png

  • Piramal Healthcare, PHL, is the market share leader in the Indian Pharmaceuticals market: 8.6% (2010)

  • GlaxoSmithKline, un United Kingdom revenue leader has a presence in the Indian pharmaceutical market with a share of: 5.8% (2010)

  • 77.6% of the market is occupied by other smaller pharmaceutical companies


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