In contrast with the research findings of Scherer at al., it is that in the pharmaceutical company large number of the diversified portfolio might not return huge profits. The strategy of the Rumack pharmaceuticals was that they expanded their product range to sustain and then capitalize upon the market share, which the product variants would secure for the company. In case of the pharmaceutical industry the rate of growth often demanded by the market to be sustainable for the company, usually would coerce the pharmaceuticals to engage in the low risk activities which was the same as in the case of Rumack.
Usually in the case of the pharmaceutical companies producing and marketing a wider range of drugs would reduce the dependence on the so called specialized drugs. The strategy that has been employed in the case of Rumack seems to fit into the module of core model. The company has eventually diversified into a number of drugs rather than being dependant on a single most drug thereby taking advantage of the opportunity costs of the product ranges.
Product choice of a company depends much upon the internal capabilities of the company which is evident from the fact that the company after closing operations in one of the particular plant transferred the packaging capabilities into the Bakersfield, in order cater to the growing demand of Restaolvic and Hedanol products.
In case of this company they have tried to combine the mutually supportive capabilities. They have tried to develop a business model by integrating the drug line and the production capabilities. Furthermore, packaging is arranged as a line hybrid process. (”Pharmaceutical industry project, equity, sustainability and industry development Working paper series” , 2002)1
From the volume of the production being made it is implied that the company aims at developing the secondary sales figures, by fiddling with the availability of the products and increasing the...