Answer The Following Question.: Section C
Answer The Following Question.: Section C
Answer The Following Question.: Section C
SECTION C
5. The Board of Directors at B-Pharma are now exploring the other two strategic options:
To gain productive capacity and a network of distribution channels in Europe, B-Pharma could enter
this market through hostile takeover of several European companies. The businesses could be bought
cheaply.
Some directors think that the company could be seen as more ethical if they made products to improve
animal welfare. B-Pharma could produce a range of drugs for animals to be sold to vets. This huge
and growing market around the world is very competitive and for B-Pharma has several risks. This
market is completely new to B-Pharma so a joint venture with an experienced Japanese company has
been suggested. B-Pharma is considering a new brand name.
Predicted
Option
outcome
Successful 0.3 $800m 1 $101m
Option 3
3 ??
$120m Not successful 0.7 $40m
(Question 5 continued)
Using quantitative and qualitative data from the case study and the additional stimulus
above, recommend which option 1 or 3 is best for achieving B-Pharma’s objective of
growth.
You will find it useful to calculate the predicted outcome for Option 3 in the above
decision tree. [20 marks]