Turing Pharmaceuticals: The Ethics of Drug Pricing SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Turing Pharmaceuticals: The Ethics of Drug Pricing
In 2015 there was a public outcry over the price increase in Daraprim (pyrimethamine) by Turing Pharmaceuticals AG (Turing). Daraprim was a drug that was widely used by a small population of U.S. patients to treat toxoplasmosis. Soon after Turing acquired its commercialization rights in August 2015, the company increased the list price of the drug by over 5,000 per cent. The increase led to consumer protests in the United States, and the media vehemently condemned Turing's action of raising the price for the decades-old drug that had gone off-patent in 1970. Later, the U.S. Congress stepped in, demanding that Turing's officials clarify how they could justify the high price of Daraprim. How should Turing respond to the public outcry? Should Turing stand by the increased price for Daraprim? How could it handle the outcry from the patient groups that needed Daraprim? Shernaz Bodhanwala is affiliated with FLAME University.
Swot Analysis of "Turing Pharmaceuticals: The Ethics of Drug Pricing" written by Shernaz Bodhanwala, Aakash Bothra includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Turing Daraprim facing as an external strategic factors. Some of the topics covered in Turing Pharmaceuticals: The Ethics of Drug Pricing case study are - Strategic Management Strategies, Ethics, Pricing and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Turing Pharmaceuticals: The Ethics of Drug Pricing casestudy better are - – there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, geopolitical disruptions, wage bills are increasing, central banks are concerned over increasing inflation, increasing commodity prices,
increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, etc
Introduction to SWOT Analysis of Turing Pharmaceuticals: The Ethics of Drug Pricing
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Turing Pharmaceuticals: The Ethics of Drug Pricing case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Turing Daraprim, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Turing Daraprim operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Turing Pharmaceuticals: The Ethics of Drug Pricing can be done for the following purposes –
1. Strategic planning using facts provided in Turing Pharmaceuticals: The Ethics of Drug Pricing case study
2. Improving business portfolio management of Turing Daraprim
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Turing Daraprim
Strengths Turing Pharmaceuticals: The Ethics of Drug Pricing | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Turing Daraprim in Turing Pharmaceuticals: The Ethics of Drug Pricing Harvard Business Review case study are -
Sustainable margins compare to other players in Leadership & Managing People industry
– Turing Pharmaceuticals: The Ethics of Drug Pricing firm has clearly differentiated products in the market place. This has enabled Turing Daraprim to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Turing Daraprim to invest into research and development (R&D) and innovation.
Learning organization
- Turing Daraprim is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Turing Daraprim is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Turing Pharmaceuticals: The Ethics of Drug Pricing Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Turing Daraprim
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Turing Daraprim does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Turing Daraprim has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Turing Daraprim to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Leadership & Managing People field
– Turing Daraprim is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Turing Daraprim in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Turing Daraprim is present in almost all the verticals within the industry. This has provided firm in Turing Pharmaceuticals: The Ethics of Drug Pricing case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Innovation driven organization
– Turing Daraprim is one of the most innovative firm in sector. Manager in Turing Pharmaceuticals: The Ethics of Drug Pricing Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Turing Daraprim digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Turing Daraprim has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to recruit top talent
– Turing Daraprim is one of the leading recruiters in the industry. Managers in the Turing Pharmaceuticals: The Ethics of Drug Pricing are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Turing Daraprim in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Turing Daraprim is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Shernaz Bodhanwala, Aakash Bothra can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Cross disciplinary teams
– Horizontal connected teams at the Turing Daraprim are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Weaknesses Turing Pharmaceuticals: The Ethics of Drug Pricing | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Turing Pharmaceuticals: The Ethics of Drug Pricing are -
Low market penetration in new markets
– Outside its home market of Turing Daraprim, firm in the HBR case study Turing Pharmaceuticals: The Ethics of Drug Pricing needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Shernaz Bodhanwala, Aakash Bothra suggests that, Turing Daraprim is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Skills based hiring
– The stress on hiring functional specialists at Turing Daraprim has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Aligning sales with marketing
– It come across in the case study Turing Pharmaceuticals: The Ethics of Drug Pricing that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Turing Pharmaceuticals: The Ethics of Drug Pricing can leverage the sales team experience to cultivate customer relationships as Turing Daraprim is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Turing Pharmaceuticals: The Ethics of Drug Pricing has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Turing Daraprim 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Turing Pharmaceuticals: The Ethics of Drug Pricing, in the dynamic environment Turing Daraprim has struggled to respond to the nimble upstart competition. Turing Daraprim has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Turing Daraprim supply chain. Even after few cautionary changes mentioned in the HBR case study - Turing Pharmaceuticals: The Ethics of Drug Pricing, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Turing Daraprim vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Turing Daraprim needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow decision making process
– As mentioned earlier in the report, Turing Daraprim has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Turing Daraprim even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
No frontier risks strategy
– After analyzing the HBR case study Turing Pharmaceuticals: The Ethics of Drug Pricing, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Turing Pharmaceuticals: The Ethics of Drug Pricing HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Turing Daraprim has relatively successful track record of launching new products.
Opportunities Turing Pharmaceuticals: The Ethics of Drug Pricing | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Turing Pharmaceuticals: The Ethics of Drug Pricing are -
Creating value in data economy
– The success of analytics program of Turing Daraprim has opened avenues for new revenue streams for the organization in the industry. This can help Turing Daraprim to build a more holistic ecosystem as suggested in the Turing Pharmaceuticals: The Ethics of Drug Pricing case study. Turing Daraprim can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Turing Daraprim can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Leveraging digital technologies
– Turing Daraprim can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Better consumer reach
– The expansion of the 5G network will help Turing Daraprim to increase its market reach. Turing Daraprim will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Turing Daraprim in the consumer business. Now Turing Daraprim can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Turing Daraprim to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Turing Daraprim to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Turing Daraprim can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Turing Daraprim can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Turing Daraprim can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Turing Daraprim can use these opportunities to build new business models that can help the communities that Turing Daraprim operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Turing Daraprim can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Turing Daraprim can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Turing Pharmaceuticals: The Ethics of Drug Pricing, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Turing Daraprim can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Turing Daraprim to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats Turing Pharmaceuticals: The Ethics of Drug Pricing External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Turing Pharmaceuticals: The Ethics of Drug Pricing are -
Stagnating economy with rate increase
– Turing Daraprim can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Turing Pharmaceuticals: The Ethics of Drug Pricing, Turing Daraprim may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Turing Daraprim business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Turing Daraprim can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Turing Daraprim needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Turing Daraprim can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Turing Daraprim will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Increasing wage structure of Turing Daraprim
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Turing Daraprim.
High dependence on third party suppliers
– Turing Daraprim high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Turing Daraprim in the Leadership & Managing People industry. The Leadership & Managing People industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Turing Daraprim can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Turing Pharmaceuticals: The Ethics of Drug Pricing .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Turing Daraprim with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Turing Daraprim needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Turing Daraprim is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Turing Pharmaceuticals: The Ethics of Drug Pricing Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Turing Pharmaceuticals: The Ethics of Drug Pricing needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Turing Pharmaceuticals: The Ethics of Drug Pricing is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Turing Pharmaceuticals: The Ethics of Drug Pricing is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Turing Pharmaceuticals: The Ethics of Drug Pricing is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Turing Daraprim needs to make to build a sustainable competitive advantage.
