China's Pharmaceutical Industry - Porter’s Five Forces Strategy Analysis

Pharmaceutical is one of the most intense “Knowledge Driven” industries, which is continually in a state of dynamic transition.Diversities in life forms and diseases pose stiff challenge to the design of specific and targeted solutions. The process of “drug discovery/invention” is elaborate requiring on an average 8-10 years at a cost of US$ 300 million to reach a new drug to the market.

Aruvian's R'search analyzes China's Pharmaceutical Industry in the Michael Porter’s Five Forces Analysis. It uses concepts developed in Industrial Organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market. Porter referred to these forces as the microenvironment, to contrast it with the more general term macroenvironment. They consist of those forces close to a company that affect its ability to serve its customers and make a profit. A change in any of the forces normally requires a company to re-assess the marketplace.