(MBA – Spring 2011)
Strategic Management Case Study
Reason for new mission8
Financial and Operating Performance Analysis11
Key Industry Ratios14
Operating Profit margin14
Net Profit margin14
Return on Assets15
Inventory Turnover Ratio15
External Factor Evaluation Matrix21
Competitive Profile Matrix23
Internal Factor Evaluation24
Grand Strategy Matrix31
Recommended strategy No.1:31
Recommended strategy No.2:32
Projected Financial Statements33
Company worth Analysis34
Strategic Review and Evaluation Procedures:35
Merck & Co. is a research driven pharmaceutical company involved in manufacturing of pharmaceuticals and drugs. Merck's products are not limited to preventive and therapeutic vaccines. Merck merged with Schering-Plough in November of 2009 for $41billion. Merck is based in Whitehouse Station, New Jersey and has more than 110000 employees.
The company has a annual revenue of $45billion during the year ending December 2010. The increase in revenues was mainly due to the incremental sales resulting from the inclusion of the post-merger results of Schering-Plough products. The operating profit of the company was $1,653.0 million during FY2010, a decrease of 90% over 2009. The net profit was $859 million in FY2010, an increase of 93% over 2009. Merck’s products include preventive and therapeutic vaccines sold by prescription to treat human disorders and to also treat animal health. The company manages many products in different segments.
Human health pharmaceutical products consist of prescription therapeutic and preventive agents for the treatment of human disorders. Merck distributes its human health pharmaceutical products to retailers, government, drug companies, health and wellness organizations, and others. Merck's vaccine products are primarily managed and administered at physician offices. These products include preventive vaccines. The US Centers for Disease Control and Prevention Vaccines for Children program is a major customer for some of these vaccines.
Merck also manages a clinical pipeline that has products in many different disease domains not limited to diabetes, heart strokes, hyper-tension, inflammatory problems, neurology related diseases, osteoporosis, respiratory, female health and many other prominent and new domains. This pipeline is managed in phases followed by a few ready for registration. Majority of these are subject to FDA approval before commercial manufacturing commences.
Merck also manages vaccines for animal health and this is a growing segment where there is more need for research for prevention of many diseases in animals. In addition to the above many different segments, Merck also manages a portfolio of regular consumer healthcare and manufactures many OTC products, foot and sun care products not just in the USA but also in Canada. Current Vision
We make a difference in the lives of people globally through our innovative medicines, vaccines, and consumer health and animal products. We aspire to be the best healthcare company in the world and are dedicated to providing leading innovations and solutions for tomorrow. (1) Current Mission
To provide innovative, distinctive products and services that save and improve lives and satisfy customer needs, to be recognized as a great place to work, and to provide investors with a...