LOW PRICING FACTOR IS RELUCTANCE TO INVESTMENT – A CASE

STUDY ON BARRETT HODGSON PAKISTAN (PVT.) LTD

“health is our concern”

STUDENT NAME
SADAF JAMAL (REG NO. 1731105)
ANJALI (REG NO. )
MARIA (REG NO. )

SUPERVISOR’S NAME
DR. KAMRAN AHMED SOOMRO

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TABLE OF CONTENTS

1. BACKGROUND OF THE CASE ............................................................................... 4

2. INTRODUCTION OF THE INDUSTRY ................................................................... 5

3. BACKGROUND & INTRODUCTION OF THE COMPANY ................................... 6

4. ISSUES/CHALLENGES AND REASONS ................................................................ 7

4. PROPOSED SOLUTIONS............................................................................................

5. APPLIED STRATEGIES……………………………………………………………...

6. CONCLUSION………………………………………………………………………...

7. RECOMMENDATIONS………………………………………………………………

REFERENCES .....................................................................................................................

APPENDIX (A) (B) (C) (D)…….……………………………………………….……..

TEACHING NOTES…………………………………………………………………...

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 ACKNOWLEDGEMENT

It is indeed a great pleasure for us to submit this case study titled, “Low Pricing Factor is
Reluctance to Investment – A Case Study on Barrett Hodgson Pakistan (Pvt.) Ltd.”
completed as a part of our term project for Strategic Management instructed by Dr. Kamran
Ahmed Soomro.
We take this golden opportunity to thank Dr. Kamran Ahmed Soomro at SZABIST Karachi
Campus who with his support and venerated guidance made this case study a real success. We
express our sincere thanks to the protagonist of this study from Barrett Hodgson Pakistan
(Pvt.) Ltd., who inspite of their busy schedule have lent their precious time for giving us
interview.

As a part of the Degree it was a very knowledgeable experience that makes a mark at the
profoundest part of my mind and I hope that the same opportunities will also be provided to us in
future.

Thanks,

____________________ ___________________ __________________

Sadaf Jamal
Reg # 1731105 Reg # ______________ Reg #
Program: PhD-MS Program: MS-MS Program: MS-MS
SZABIST Karachi SZABIST Karachi SZABIST Karachi

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 BACKGROUND OF THE CASE

After closing ceremony of annual conference held in Malaysia. It was December 10, 2018a bit cold
weather at night. Mr. Afaq and his team comes inside at hotel conference room and sit informally to
discuss briefly about conference and the scenario what the company & industry facing at present. Mr.
Afaq working as Deputy Director Commercial in Barrett Hodgson Pakistan (Pvt.) Ltd. He is the
person who has been associated with the company since the time when it was not reputable in the
pharma industry market. Mr. Afaq considered as most senior, sincere and dedicated employee of
the company, a person behind the success of the company. Mr. Afaq as entered in the conference
room environment of the room was quite peaceful his co-team members already sit in their
comfortable zone, Mr.Afaq started generally to address with all his co-workers present in the
conference room and looking towards Mr. Munir one of his team members and closest
friendinitiate conversation to ask about conference experience further, conversation extended to
talk aboutthe time when company entered in the pharma market their background,how leaders of
the company jointly worked hard and prove to be a good team as result where the company
achieved his position in highly competitive market of pharma industry.

Mr.Munir further continue the conversation really, the core success credit goes to Barrett
Hodgson good team work, as company success can be easy distinguish with its good or bad
human resource. As he representing human resource management part of the company.

Another co-team member Mr.Ashir who has plenty of experience of pharma industry but
recently joint the company from another pharma, Mr. Ashir has versatile knowledge about
operation and pharma industry dynamics he took part in conversation and divert forum
concentration towards the issue that the pharma industry accumulated facing now a days and that
is regulatory bodies reforms and policies that creates trouble for this industry for future growth.

Indicating another barrier by Mr. Jawad in group conversation of dug pricing policies regulate by
DRAP under the health ministry of Government of the state shows reluctant to increase atleast
justify price this is the reason not sufficient research & development in the new molecules
generate new refine medicines in the market. Mr. Jawad continues that pricing issue is the most
prominent issue that has been facing by the entire industry. Annual increment of 3% in dug
prices is not justifiable and not enough for growth in real sense of the companyand industry as
well.

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r.Afaq take a deep breath and seems some in deep thought towards the trouble situation exist and
face by the company, he concluded the session and allow the team to leave the conference room.

INTRODUCTION OF THE INDUSTRY

The Pharma industry of Pakistan is considered one of the core sector in economic engine. It
generates approx. 40% of the total revenue of the state. The regulatory body of this industry
work under federal ministry of health. In further regulatory bodies include Pharma Bureau it is a
representative body of multinational pharmaceuticals in Pakistan. Part of the Overseas Investors’
Chamber of Commerce & Industry, overall regulatory body of this industry policies& reforms
body is Drug Regulatory Authorityof Pakistan (DRAP), the Pharma Bureau was founded in
October, 1988, to ensure uniform policies among all national & multinational companies and
articulate and resolve the problems and issues, confronting overseas investors in the
pharmaceutical industry in Pakistan and create such platform where industry address with the
government. The issues& interest of the firms were same and required a focused and
concentrated approach in projecting and solving common collective business interests for the
industry and provides such subsidy that could help in providing wide range of drugs alternatives
in pharmaceutical product line and more research based would be produced.

There are more than 700 Pharmaceutical firms actively working in Pakistan among these 21 are
multinational companies and20 are members of Pharma Bureau.The Pharma Bureau have set
high ethical standards in overall industry. Provide support and guidance to the target customers
also make attention of government to address the health sector patient issues and welfare.

The Pakistan Pharmaceutical Industry is an essential, high technology and a strategically

important industry. It is an industry which manufactures a wide range of research based life-
saving and enhancing medicines and is a major contributor to the health of the people of
Pakistan, and to the economic health of the Country.

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BACKGROUND & INTRODUCTION OF THE COMPANY

Barrett Hodgson Pakistan (Private) Limited was established by S.M. Habib in Pakistan on
September 2, 1992, and began its production operations from January 20, 1996. Barrett Hodgson
is well known name among pharmaceutical companies of Pakistan. Another reason of its
popularity is, its international collaboration partners in Pakistan. Barrett Hodgson has main
licensing arrangements with Allergan, USA, AstraZeneca, UK, and Astellas, Japan and this
privilege has only by Barrett Hodgson. Among all active pharma companies working in Pakistan
Barrett Hodgson is number 15th in the list. Anothermotivation factor is itsdynamic leadership and
strong and experienced management team its top management and BODs are on of its core
competency. (Organogram attached in Annexure-A).Barrett Hodgson produced scheduled and
non-schedule drugs and most of its products even not mitigate break even position but still they
are ensure its productivity due to patient care.

Barrett Hodgson strictly followed IPMA code of ethics formulate by regulatory bodies. Barrett
Hodgson believe in positive competition on the basis of quality of products produced in
competitive market,high standard, quality aware company, which is comparable to any
pharmaceutical concern in Pakistan. Barrett Hodgson not make themselves enter in franchise
products competition market. Barrett Hodgson also perform focusly CSR projects. The most core
example its Bareett Hodgson University it’s a big project towards provide education, they also
have charity organization in toba tek singh and ensure its transparency towards non-profit
organization.

Barrett Hodgson has similar issues faces by the industry. Basically Pakistan’s pharmaceutical
company is faces various challenges and industry is still in developing phase. Besides all firm
growing in its own pace but still looking forwards towards Government and regulatory bodies to
take such reforms that would help to grow overall industry as this sector is directory associated
to health care of the people of the state. Regulatory Bodies need to assure provide of platform for
positive competition. Subsidize price on import of raw materials. Safeguard to intellectual
property rights and most important justify price increment need the most by Barrett Hodgson.

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 ISSUES/CHALLENGES AND REASONS

As reached in regional office after annual conference Mr.Afaq generate an email in the evening
while sitting late in the office and call a meeting of all team members by tomorrow at 10:00 a.m.
Agenda is to discuss in detail about issues addressed in conference unofficially. Highlight the
issues and challenges face by the company. As numerous issues has been facing by the company
parallel to the industry.
At morning about 10:00 a.m. Mr.Afaq was first who reached in the meeting room. He keep
thinking about company issues facing but inspite of all these have hope to better policy
implement in the future by regulatory authority, and provide better business environment. As
time goes on forum of the meeting start formally approx. 10:15 a.m. Initially Mr. Ashir formally
asked to meeting Chairperson Mr. Afaq about meeting agendathen Mr.Afaq formally start to
discuss about the situation issues & challenges face by the company. Mr. Afaq invite all
participant of the meeting to give their input and observation about the company and market
scenario.
Mr. Munir started sir, well if I am talking about mass level and ground realities Pakistanhas the
lowest public sector healthcare expenditure as a percentage of GDP in the region. The rate has
increased in the last few years but government must need to drastically increase it to have any
meaningful impact on improving healthcare in Pakistan. Mr. Munir present following is the
comparison of expenditures on Healthcare in the region and the world average, according to
World Bank facts record.

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Mr. Afaq endorsed the issue mass level but industry and company faces most of the internal &
external challenges. In detail discussed as:

 Prices Freeze by Government:

The Pharmaceutical regulatory body Drug Pricing Committee (DPC), a division of the Drug
Regulatory Authority of Pakistan (DRAP), continue a freeze in drug prices, pharmaceutical
companies are threatening to shut down operations in Pakistan.In year 2001 drug price
increased by 1.43%-2.86% (around 3%) on schedule drug and non-schedule drug afterwards by
SRO 102-2013 pharma industry proposed 15% increment in drug prices but the present
government by using its power reject this SRO and the case is still in the court. In 2018 new
drug pricing increase by 2.77% -2.93% .Most of the products goes shut down because of
increase in inflation, increase utility and high import duty.

 Economy Impact:

As economy condition not good so far and ultimately it’s badly impact on industry sector.
Government tried to take harsh decisions like high rate inflation inject in the economy,
increase utilities, imposed import duty and implement new taxes on raw materials import of
drugs. Major portion of costs are of raw and packaging materials that are imported and are
sensitive to exchange rate fluctuations. As Pakistan market is very price sensitive as rumor in

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the market price become volatile. Pakistan rupees devaluation day by day in front of USD it
has also impact on drug price.

 New Technologies’ Impact on Pharma:

New technology is an ongoing issue for the pharmaceutical industry is how new technologies,
particularly related, will impact drug development and commercialization, such as artificial
intelligence and 3D printing and their impacts on business models, operations, workforce needs
and cyber security risks increase manufacturing costs to sustain in the market.

 Slowing Growth In Emerging Markets:

Lower economic growth in emerging markets is resulting in slower growth in pharmaceutical

industry growth in those markets have seen real growth in gross domestic product slow from 1-4
percentage points over the past decade, according to the firm’s study. This has triggered a
corresponding reduction in medicine volume growth, from an average of 7% annually over the
past five years to 4% forecast through 2021.

 Unethical Practices :

In Pakistan Pharama industry unethical practices has been carried out by market franchise
product and increase its prescription by top consultant. Inspite Pharma regularities bodies define
industry code of practices by IPMA. As regularities bodies define positive competition among
companies on the basis of quality of products.

 Foreign Investment Discourage:

Local regularities bodies not provides favorable environment to foreign companies to expand
their business in Pakistan region and test new modular medicines and more research incentive
medicines. Because of discourage environment new companies not willing to come here and
existing firms also windup operation from Pakistan.

 Regulatory Bodies Concerns:

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Regulatory Bodies of Pharma industry need to take major reforms and re-think over policies
implemented in industry, drug prices have been frozen by the government at levels last set in
2001 and DRAP appears inclined to continue with the current policy or even introduce an
average pricing formula, which pharma companies insist will be detrimental to their financial
health.Pakistan also sufferslack of proper implementation of policies. The initiatives should take
by government on correct policy direction, robust regulatory environment and Intellectual
Property Rights protection.

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REFERNECES
http://www.pharmabureau.org/members/barrett-hodgson-pakistan/

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ANNEXURE – A

INTERVIEW PROTOCOL

Q1: Pharmaceutical industry of Pakistan regulate under the health ministry's, the government
created the Drug Regulatory Authority of Pakistan (DRAP) in 2012, DRAP is responsible for
approving drug price rises and maintaining a list of essential medicines. What extent you satisfy
with their policies and performance as concerned to this industry.

Q2: Drug prices have been long a point of contention in Pakistan, Is it such situation face by BH
in their certain brands?

Q3: Can you share some leaders name and some of history that make BH reached at this level?
What are the motivators or demotivator behind the success of BH?

Q4: Generics prices will be fixed at 30% less than branded versions. The system is due to come
into effect on July 1st, 2016. Means that branded drugs are more expensive?
What is BH price mechanism then?

Q: 5 What do you think current challenges that BH face day by day and what would you suggest
to overcome? What strategy BH adopts?

Q6: Which segments of the market are sensitive to price, and how sensitive are they?

Q7: In Pakistan existing pricing mechanism is a major hurdle in the way of foreign investment in
the country, many of the major international companies are reluctant to invest in the
pharmaceutical sector in Pakistan. What extent it is true?

Q8: Do you follow Parma Bureau strict code of ethics; ensure supplying medicines despite
severe economic hardship to protect patient interest and quality focused?

Q9: Does BH allocate significant budget in research & development of new products?

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Q10: Is the BH products is cost based and because of the reason of cost of doing business result
in shut down of production of many/any of their product(s)?

Q11: Against inflation and heavy increase in input costs is negatively impacting fresh
investments? How much BH investment effect?

Q12: Is BH have some national & international collaborations?

Q13: How BH take industry competition? Motivate/ demotivate element

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ANNEXURE - B

External Factor Evaluation Matrix (EFE)

Weighted
Opportunities Weight Rating Score
1. Membership alliance to other drugs supplier 0.06 3 0.18
2. Increase number of doctors 0.04 3 0.12
3. technology advance innovation 0.07 2 0.14
4. Increasing health care expenditures 0.07 4 0.28
5. growing future potential market 0.05 4 0.20
Half of population has no accesss to medicine 0.03 2 0.06
7. growing rate of literacy 0.08 4 0.32
8 water pollution 0.08 2 0.16
9 increase number of disease 0.05 2 0.10

Weighted
Threats Weight Rating Score
1. Expansion of government control on price 0.10 3 0.30
2. Govern legislation allow faster entry of generic
0.05 3 0.15
drugs in market
3. Regularity problem against counterfeit products 0.05 4 0.20
4. fluctuation in foreign exchange rate 0.06 3 0.18
5. change in patent laws 0.03 3 0.09
6. political instability 0.03 4 0.12
7. growing competition 0.03 3 0.09
8. threat of substitute products like Herbal 0.04 4 0.16
9. lack of system 0.04 4 0.16
TOTALS 0.96 3.01

Internal Factor Evaluation Matrix (IFE)

Weighted
Strengths Weight Rating Score
1 Good relationship with supplier 0.04 3 0.12
2 reliability and transparency 0.08 4 0.32
3 strong brand name 0.05 3 0.15
4 high commitment employees 0.06 3 0.18
diversify portfolio 0.09 3 0.27
5 commitment to ethical practices business 0.08 4 0.32
6 large customer equity 0.08 4 0.32

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 Weighted
Weaknesses Weight Rating Score
1. Patent expiration 0.09 3 0.27
2. lack of technical expertise 0.06 1 0.06
3. highly depend on distributors and doctors 0.07 4 0.28
4. little advertisement and promotion 0.04 2 0.08
5. high running cost 0.05 4 0.20
6. reporting structure 0.05 2 0.10
8. In differentiate products 0.08 2 0.16
10. competition from generic products 0.08 4 0.32
TOTALS 1.00 3.15

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ANNEXURE – C

Vision & Mission Statement

Pharma Bureau is an organisation of Pakistan’s research and innovation driven pharmaceutical

companies committed to addressing healthcare needs by:
• Facilitating greater access to quality healthcare solutions
• Encouraging research and innovation
• Disseminating knowledge and sharing best practices
• Contributing meaningfully in policy dialogues by working closely with the relevant
Government authorities

Our members:
Provide quality drugs to the population at affordable prices without compromising on stringent
industry standards. Introduce innovative drugs and medicines in Pakistan to enhance patient
welfare and quality of life. Provide refresher courses to doctors on latest health topics / trends
and educate them on new medication. Introduce, uphold and promote Good Manufacturing
Practices (GMP) and Good Distribution Practices (GDP). Are conscientious and ethical members
of society, providing social care and support during national disasters.

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ANNEXURE – D

Organogram

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 Mckinsey & Company in a report commissioned by Planning Commission of Pakistan and Asian
Development Bank identified the Pharmaceutical Industry as Sunrise industry – an industry
which can lead Pakistan to economic prosperity should there be sound legislative reforms.
The report cites 4 main areas for the Government of Pakistan to focus to enable growth of the
Pharmaceutical sector:
 Price - Reform pricing to support public health and industry performance
 FDA - Incentives to invest in FDA-quality plants and gain access to largest export markets
 Production - Allow contract manufacturing without limitation
 Quality - Set high and uniform quality bar and enforce it


The pharmaceutical industry continues to face multiple challenges, particularly the

nonoperational status of the Drug Regulatory Authority (DRAP), which is still functioning
without a permanent chief executive despite a lapse of two years, say pharma experts. “A lack of
predictable policy and an ineffective regulatory authority has forced investment in the pharma
sector to slow down,” said Pharma Bureau Chairman Shahab Rizvi, adding that many companies
have left the country in search of higher profits and stability.
Investment in the pharma sector drastically decreased Rs14 billion between 2007 and 2010,
Further Habib Sir said, numerous new and advanced drugs had not been introduced in the
country due to a delay in the drug registration policy. “No roadmap has been chalked out and
uncertainty in the sector continues to hamper our exports,” he said. At present, the country’s
pharma sector exports stand at $190 million, notably lower than estimation of $15.5 billion.
Health Ministry department has set a target to export $25 billion by 2016. He went on to add that
there has been no price rationalization in the pharma sector for the past decade. Further, he said,
there has been a cap on the prices of drugs since 2001 regardless of the fact that the prices of all
commodities and raw material have been increased by at least 100 percent. “The constant
devaluation of the Pakistani rupee against other currencies has also hurt the industry as 92
percent of the basic raw material is imported in large quantities from the US, UK, Germany,
Japan, and China.” He said there are around 650 pharmaceutical companies in Pakistan out of
which only 22 are multinationals. The market share of MNCs is around 45 percent. “Most MNCs
are suspending their investments or operations due to the uncertainties that are prevailing in the
sector and diverting their investment to other countries,” he added. Arshad Saeed Husain, Co-
Chairman of the Pharma Bureau, said there isn’t a single national drug testing laboratory in the
country despite the pharma

Opportunities and challenges for Pakistani Pharmaceutical Industry

Pakistan has a very vibrant and conducive environment for pharmaceutical industry (PPMA,
2011). Pharmaceutical industry has great potential in Pakistani market. This industry is growing
consistently from the last six decades. However, in Pakistan there is still a lot of potential for
pharmaceutical industry to establish new manufacturing unit to fill the gap of demand and supply

18
in Pakistani market. In Pakistan pharmaceutical industry also has challenges for their growth and
development. This industry is a complex and knowledge intensive, therefore it face multifarious
challenges.
Rana, Salaria, Herani, and Gureshi (2009) pointed out that the in pharmaceutical industry in
Pakistan is facing challenges such as increased buyer-cost sensitivity, global competition and
technological advancement. There is no doubt that in a knowledge-based economy, intellectual
capital of industry has secured significant attention. In a knowledge-based economy global
business environment is mainly dominated by knowledge and innovation. In other words
knowledge and innovation are the main pillars of success for the high-tech organizations. The
increasing trend towards knowledge- based economy and interdependent world economy
pushing nations and policy makers to a complex and competitive environment. It is indispensable
for nations and organizations to have a profound understating based on intellectual capital and
scientific analysis.

OUR FOCUSED ON PRICE

Price is one of the most interesting and controversial topics in pharmaceutical marketing. The
responsibility of allowing a particular price lays with the regulatory bodies, as in case of
Pakistan, The Ministry of Health.
Cost Structure in Pharmaceutical Products , Cost of active ingredient: Usually the highest cost
component. In most of the cases, it ranges between 10-30% of total cost of product. Cost of
other ingredients: A minor element, usually not higher than 3% of total cost. Cost of packaging
material: Varies according to a material being used. In absolute terms, cost of packaging material
ranges between Rs. 5 -10 per pack of 10 tablets/capsules, per 60 ml bottle of liquid, per 5 ml
injection & per 50 grams tube of ointments. Cost of manufacturing: Depends on volume being
manufactured in a factory. Besides that, a company may amortize its R&D cost over a period of
time, which becomes an additional cost component.
Pricing Structure in Pharmaceutical Products Assuming a retail price of Rs. 100/- following will
be the price structure: Retail Price: 100 Less: Retailer’s margin@15% 15. In case of imported
products, the retailer’s margin may be brought down to 10%
Cost-Plus pricing this type of pricing is usually done for old molecules where market is very
crowded, and a higher price cannot fetch the required market share. The objective of company in
such scenario is to either get some additional volume for their manufacturing facility, or to
complement their existing product range. .
Value Based Pricing. This approach for pricing is most commonly used by Multinational
companies, en-cashing their good rapport with the doctors, especially in case of new molecules.
There are countless examples where the cost of product has no relevance whatsoever and
company has priced a product as per the perceived value for the doctors in their opinion.
However, things are becoming difficult now, and companies must be very careful while adopting
this approach. They have to not only be careful about the wrong judgment of perceived value
that they may make, and also the possibility of launch of same molecule by a local company with
good reputation and quality.

SWOT
Strengths

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  Barret Hodgson has a mature pharmaceutical industry with an adequate manufacturing
base and capacity to produce quality drugs.
 It has a pool of productive, proficient graduates, who are flexible and hard working.
 Barret Hodgson has commitment to reliability and transparency.
 Barret Hodgson has large customer equity
 Barret Hodgson has Diversify portfolio
 B.H committed to ethical code of ethics.

Weaknesses

 Barret Hodgson has a very small internal market.

 There appears to be a lack of innovation within the pharmaceutical industry.
 Stringent price regulations effect the profitability of Barret hodgson
 Lack of coordination of company to industry
 B.H has in differentiate products
 B.H has little marketing activities
 B.H highly dependent on distributor and doctors

Opportunities
 Barret Hodgson has growing consumers market.
 New molecules Can be developed with the help Of R and D
 The constant growth of the number of people taking medication.
 Newly formed alliances of insurance companies and mail order pharmacies.
 Increase number of disease in market
 Water pollution increase day by day

Threats

 Competition from developing countries is increasing.

 R&D infrastructure and investment are under-developed.
 Transport infrastructure and storage facilities for temperature-sensitive drugs are not
readily available.
 Regulatory legislation that curtails the mail order medicine industry
 Fluction in forign exchange rate
 Government control on drugs prices

Based on external and internal analyses by indentify variable through SWOT analyses we
reached at this level that we go for Grow and Build strategy because our external evaluation
result is that and3.01 out internal evaluation is that 3.15 so our result lies in grow and build
strategy because Barret Hodgson has still gap in market where company invest in Research and
development and go for new products which give them competitive edge.

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SCENE # 1
Dr. Hussain Habibworking as Deputy Director Commercial in Barrett Hodgson Pakistan (Pvt.) Ltd.
discussed with their colleagues after the quarter end meeting the time of introducing company in
the market their background and general information about the company.
BACKGROUND
INTRODUCTION
SCENE # 2
Continue discussion by Dr. Hussain Habib the issues faced by the company with internal &
external influences.
ISSUES/PROBLEMS
SCENE # 3
Dr. Hussain Habib keep thinking about the matters as he is very much loyal towards his
company. He is very much aware the position of the company and always curious about it.One
day he called meeting for open forum of proposed suggestions from all group team leaders.
PROPOSED SUGGESTION
SCENE # 4
Dr. Hussain Habib also open forum for proposed strategy adopted by the company and beneficial
in the future.
PROPOSED STRATEGIES
SCENE # 5
Meeting closed by the concluding entire discussion & recommendations taken from group heads.
After meeting closure Dr. Hussain Habib have very much ambitious for the future of the
company.
CONCLUSION

RECOMMENDATION

21
Teaching Notes
Description:
This case is about pharmataceutical company Barrett Hodgson Pakistan (Private) Limited, in this
case we have discussed how pricing factor effect companies growth and these low pricing
policies are set by Governemnt which are known as Dug pricing policies which are regulated by
DRAP which decides pricing policies for pharma industries and this company is facing slow
down in pricing. Pharma companies are looking forward to Government and regulatory bodies to
take such reforms that would help to grow overall industry as this sector is directory associated
to health care of the people of the state. It affects entire industry, because of these issues there is
no sufficient development in new medicines.
Purpose:
The purpose of this case is to highlight the issues which may create problems for developemt of
company barret hodgson Pakistan (private) Limited they are facing various problems due
Government intervention one of the most important factor Dug pricing policies which resist in
development of pharma industries. Pakistan’s pharmaceutical company faces various challenges
due to ineffective pricing policies.
Audience: business Graduates
Topics Covered: Pharma industries problems and solutions
Teaching Strategy: we can explain overall case by sharing our whole experience, how we took
interview and we will show data we have collected by taking interview through slides when we
will explain each and everything students will get to know about how pharma industries are
facing problems due to Government interventions
Discussion Questions:
Q1: Pharmaceutical industry of Pakistan regulate under the health ministry's, the government
created the Drug Regulatory Authority of Pakistan (DRAP) in 2012, DRAP is responsible for
approving drug price rises and maintaining a list of essential medicines. What extent you satisfy
with their policies and performance as concerned to this industry.

Q2: Drug prices have been long a point of contention in Pakistan, Is it such situation face by BH
in their certain brands?

22
Q3: Can you share some leaders name and some of history that make BH reached at this level?
What are the motivators or demotivator behind the success of BH?

Q4: Generics prices will be fixed at 30% less than branded versions. The system is due to come
into effect on July 1st, 2016. Means that branded drugs are more expensive?
What is BH price mechanism then?

Q: 5 What do you think current challenges that BH face day by day and what would you suggest
to overcome? What strategy BH adopts?

Q6: Which segments of the market are sensitive to price, and how sensitive are they?

Q7: In Pakistan existing pricing mechanism is a major hurdle in the way of foreign investment in
the country, many of the major international companies are reluctant to invest in the
pharmaceutical sector in Pakistan. What extent it is true?

Q8: Do you follow Parma Bureau strict code of ethics; ensure supplying medicines despite
severe economic hardship to protect patient interest and quality focused?

Q9: Does BH allocate significant budget in research & development of new products?

Q10: Is the BH products is cost based and because of the reason of cost of doing business result
in shut down of production of many/any of their product(s)?

Q11: Against inflation and heavy increase in input costs is negatively impacting fresh
investments? How much BH investment effect?

Q12: Is BH have some national & international collaborations?

Q13: How BH take industry competition? Motivate/ demotivate element

23
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