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09902787224
Examination Paper of Pharmaceuticals Management
IIBM Institute of Business Management
Examination Paper MM.100
Pharmaceuticals Industrial Management
Section A: Objective Type (30 marks)
This section consists of Multiple Choices/Fill in the blanks & short notes type questions.
Answer all the questions.
Part one questions carry 1 mark each & Part Two questions carry 5 marks each.
Part One:
Multiple Choices:
1. Which of the following not the principle of co-‘ordination?
a. Principle of early beginning
b. Principle of continuity
c. Principle of time
d. Principle of reciprocity
2. Oral communication includes-.
a. Lecture
b. Poster
c. Union publication
d. Complaint procedure
3. Enthusiasm, co-operation, tact and skillful handling come under-.
a. Intellectual quality
b. Character quality
c. Psychological quality
d. Physical quality
4. Which of the following is the demerit of formal communication?.
a) Decay in accuracy
b) Time consuming
c) It is temporary
d) Fairly unsuitable
5. Arrange the following into decision making process
i. Conception
ii. Investigation
iii. Perception
iv. Selection
a) iv,i,iii, ii
b) ii,iv iii,i
c) iv,i,iii,ii
d) iii,i,ii, iv
IIBM Institute of Business Management 1
Examination Paper of Pharmaceuticals Management
6. FIFO stands for ______________________.
7. Record of all item of material and good in the store is recorded in which document?
a) Store ledger
b) Bin card
c) Both a & b
d) None of these
8. VED stands for ______________________.
9. In the EOQ formula ‘C’ is stand for-
a) Annual consumption
b) Cost of per unit of material
c) Cost per order
d) Storage
10. WTO stands for ______________________.
Part Two:
1. What is questionnaire? Explain rules or guidelines for designing a good questionnaire?
2. Define drug store management? ‘Discuss the arrangements of drugs in drug store?
3. Name the various steps in the selection of a pharmacist?
4. What are the purposes of training given to a pharmacist?
END OF SECTION A
Section B: Caselets (40 Marks)
This section consists of Caselets.
Answer all the questions.
Each case let carries 20 marks.
Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
For the Indian Pharmaceutical Industry which has been presenting a robust performance during the last
few years, the internet is a powerful tool. Web-enabling leverages the pharmaceutical firm’s existing
investment in IT. Customer Relationship Management (CRM) and Sales Force Automation (SFA)
systems can be web-enabled to cost of operations, and on being effectively used, they establish immense
customer goodwill.
IIBM Institute of Business Management 2
Examination Paper of Pharmaceuticals Management
The speed, efficiency and accuracy of a pharmaceutical company’s response to customer queries
determine the extent of customer satisfaction. About 200,000 doctors will be contacted by a typical midsized
pharmaceutical company, on a regular basis. It is crucial that these doctors are kept abreast of
product profiles, new introductions etc. also, during the sales calls made by the field force queries are
raised by the doctors, which need to be addressed quickly. By possessing a comprehensive medical
information system, pharmaceutical companies are able to fulfill their obligations, and, at the same time,
lend support to their sales and business partnerships. A good CRM system incorporates features that
enable information sharing and identification of trends in the market; at the same time, to accommodate
growth, it runs on a scalable platform.
A good CRM system is characterized by two key functions:
Tracking, organizing, prioritizing and responding to callers; and
Automating quick responses through letter, fax or e-mail, using a comprehensive data
base.
The CRM system can help make urgent responses. It will also have a system of archiving call sheets.
The benefits of a good CRM system include a facility to handle a large number of medical queries
efficiently; tracking customer correspondence/exchanges; retrieval and dissemination of the latest medical
information; providing statistical reports for the re-assessment of product profiles. A good CRM system
arms the company with tools to implement measures for continuous improvement of its business
practices; it can be an invaluable aid to the sales force in understanding the interests and concerns of
medical practitioners.
Sales Force Automation (SFA) is a system related to the CRM system. This tool enables a company to
manage a vast field force. The system provides up-tp-date information to the field force while they are on
the field; it provides the managers with a facility to keep a tab on field force’s activities and ensure they
are going according to plan.
A good SFA system incorporates features as under:
Customer Profiles: by maintain up-to-date, detailed profiles of customers, the system
facilitates tailoring of the profile base for different needs; a comprehensive view on
important business opportunities and important customer is generated.
Hospital Profiles: detailed hospital profiles maintained helps in implementing focused
strategies.
Activity Planning: planning of activities by each member of the team is made possible
by the SFA system.
Promotion/Call Reporting: detailed information about a particular promotion, and each
sales call are made available; this enables planning of future activities that focus on
specific needs.
Online Submission: daily call reports can be submitted online; call coverage reports and
record of monthly target achievement can be maintained.
Analysis and Reports: to facilitate better planning and strategy formulation, the SFA
system provides detailed statistics.
If the traditional applications and expertise of pharmaceuticals companies can be leveraged by webenabling
them,
then
major
benefits
are
in
store
for
them.
The
companies
can
cut
down
costs,
manage
their
markets
with
more
effectiveness
and also
enter
into
new
markets.
The
following
are
some
of
the
CRM/SFA
systems
available
in
the
market
for
the
pharmaceutical
industry.
IIBM Institute of Business Management 3
Examination Paper of Pharmaceuticals Management
Questions:
FFReporting of Sarjen Systems Pvt. Limited.
CrissSmart SFA/CRM of Oasis Infotech.
Online MR Reporting Software of Marg Compusoft Pvt. Limited.
Siebel-based Pharma CRM Implementation Kit of Infosys Technologies Limited.
Pharma Pulse of TVS-electronics.
Talisma of Talisma Corporation.
1. Briefly explain the concept of CRM & SFA systems.
2. State the features of a Good SFA system.
3. Write down some CRM/SFA systems which are available in the market for Pharmaceutical
Industry.
4. What are the benefits of CRM system?
Caselet 2
Glenmark Pharmaceuticals uses a web-based tool for sales force automation. The tool helps the sales
force in adding new contacts/accounts, deciding upon the appointments, planning their tour, planning
joint working, submitting their daily call reports, submitting request for samples, promotional articles etc.
based on the actual travel, the tool also calculates te necessary expenses to be paid to the field sales
officer. The sample management and promo management modules in the software keep a complete track
of samples and promo items. Te entire leave management system for the field sales staff runs on this
software. A part from this , the software has multiple reports such as missed call report; call average
report etc, which helps the entire sales force hierarchy to be aware of the developments and act
accordingly.
Majority of the above features and functionalities are available on the mobile interface of the application
as well. The software also allows the field force to capture certain important remarks made by the
customers. The CRM team/medical support team can make the best utilization of this data gathered.
These systems are upgraded on need basis. A part from the pure technical upgrades, the enrichment of
features and functionalities happen through the new version release of the software. The sales force
automation tool is in the form of portal. The portal has two components in terms of content- static Content
and Dynamic content. The transactions happen on the dynamic content side, where as any circulars,
information to the field force, product related FAQs, Manuals etc. are posted on the static content side.
This section really helps to keep in touch with the field force. Any product information which would help
the field force to upgrade the product knowledge can be posted here. Going forward, Glenmark also plans
to have CBT (computer based training) programs to be made online on this portal. These types of
interactive programs will really boost the process of learning for the field sales force.
Questions:
1. Explain the working of a Glenmark Pharmaceuticals.
2. State the features of a Glenmark Pharmaceuticals.
END OF SECTION B
IIBM Institute of Business Management 4
Examination Paper of Pharmaceuticals Management
Section C: Applied Theory (30 Marks)
This section consists of Applied Theory Questions.
Answer all the questions.
Each question carries 15 marks.
Detailed information should from the part of your answer (Word limit 200 to 250 words).
1. Define ‘Pharmaceutical marketing? Explain objectives and importance of pharmaceutical
marketing.
2. Define ‘Advertising’? What are the advantages and disadvantages of advertising in
pharmaceutical marketing?
END OF SECTION C
IIBM Institute of Business Management 5
Examination Paper of Pharmaceuticals Management
IIBM Institute of Business Management
Examination Paper MM.100
Pharmaceutical Marketing
Section A: Objective Type (30 marks)
This section consists of Multiple Choice questions & short notes type questions.
Answer all the questions.
Part one questions carry 1 mark each & Part Two questions carry 5 marks each.
Part One:
Multiple Choices:
1. What is the full form of ‘IPR’?
a. Intellectual property rights
b. Intellectual patent rights
c. Intellectual process rights
d. International patent rights
2. The environment that poses tremendous opportunities for new products and services to alert
marketer is an _________ environment.
a. Ecological
b. Social
c. Technological
d. Competitive
3. Arrange these market opportunities analysis step by step:
i. Evaluate new opportunities in new segments
ii. Build on your strengths
iii. Explore new market opportunities
iv. Analyze your existing markets
a. i, ii,iii,iv
b. ii,iv,i,iii
c. iv,ii,iii,i
d. i,iii,iv,ii
4. Marketing virtually the same product with two or more brand names is a strategy of:
a. Family brand strategy
b. Multiple brand strategy
c. Individual brand
d. Private brand
5. The pricing that deals with the judgmental or subjective elements of pricing is a:
a. Cost-based pricing
b. Petition based pricing
c. Market based pricing
d. Demand based pricing
IIBM Institute of Business Management 6
Examination Paper of Pharmaceuticals Management
6. Which of the following is not a member of distribution channel?
a. The Physician
b. Manufacturer
c. The consumer
d. The transporter
7. Arrange the communication process in order:
i. Medium
ii. Feedback
iii. Sender
iv. Receiver
v. Message
a) ii,iv,v,i,iii
b) iii,v,i,iv,ii
c) iv,i,iii,v,ii
d) iii,ii,iv,i,v
8. The strategy used to create a demand for a product within a channel of distribution by appealing
directly to the consumer is a:
a. Pull strategy
b. Push strategy
c. Combination strategy
d. Competitive strategy
9. Toward off a competitive threat or to create an entry barrier, some companies from different
power blocks may temporarily form a cartel it is termed as:
a. Franchise power
b. Integration power
c. Niche power
d. Coalition power
10. Which of the following ‘R’ is not a part of good management principle?
a. Resources
b. Recognition
c. Responsibility
d. Reward
Part Two:
1. Define the term “Marketing Communication”.
2. Differentiate between ‘Product Item’ and ‘Product Mix’.
3. Differentiate between ‘Cost Based Pricing’ and ‘Demand Based Pricing’.
4. Describe “Boston Matrix”.
END OF SECTION A
IIBM Institute of Business Management 7
Examination Paper of Pharmaceuticals Management
Section B: Caselets (40 Marks)
This section consists of Caselets.
Answer all the questions.
Each Caselet carries 20 marks.
Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
Apex Pharma was one of the Leading pharmaceutical companies with manufacturing plants spread all
over India. Initially, the company produced bulk drugs as the activities expanded, the company started
manufacturing formulation. The first formulation plant was commissioned at Mandideep, Bhopal in 1983.
This plant was exclusively catering to the overseas demand in various countries including the US, South
Africa, Australia and the UK.
The demand in pharmaceutical industry is not evenly spread throughout the year. There were months
when the company operated at 50%-60% of its capacity, and there were months, when the company
operated at more than the installed capacity, by working in three shifts. As a general policy, the company
used to operate in two shifts. Third shift operations were only resorted to during the peak season. Apex,
during the period of increased demand, outsourced medicines from other companies. However, the
medicines which were outsourced were sold only in the domestic market. The company applied high
quality standards so as to fulfill the requirements of the export market.
Apex’s Bhopal plant was run as a cost center and hence, it was not supposed to report any profits or
losses. The plant had three different blocks manufacturing different sets of medicines (capsules, tablets,
dry syrups and injectibles).
Semi Synthetic Penicillin Block (SSP): This block produced antibiotics and drugs based on
amoxicillin and ampicillin.
General Block: This block produced non-antibiotic drugs.
C Block: this block produced third generation drugs based on cephalosporins.
Apex had a policy to invest in a new plant and machinery only when the company foresaw a sustainable
long-term demand for a particular product. For its cephalosporin’s range of drugs, the company was
experiencing an increased demand from the US markets for the past 2-3 years.
The total investment in C-block was Rs. 130 million with the existing capacity of 396 million capsules
per year. The demand had increased to 590 million capsules per year. To meet the increased demand, the
management decided to purchase a new machine. The finance manager, Ramesh Swami, had two options
(Refer Table 1)
Table 1
Particulars Machinery I
Brand Zenhasi (USA)
Capacity
Cost of Machine
Life of Machine
300 million capsules per
annum
Rs. 11.70 million
5 years
Residual Value Nil Nil
Machinery II
Zentacs (Second hand
machinery from Russia)
200 million capsules per
annum
Rs. 9.50 million
3 years
IIBM Institute of Business Management 8
Examination Paper of Pharmaceuticals Management
Sales revenue (for 18 tones
material equivalent to 194
million capsules per annum)
Rs. 575.4 million Rs. 575.4 million
Material Cost 90.68% of sales price 90.68% of sales price
Cost of repair and overhauling
before commissioning
Total indirect costs (65%
fixed, 35% variable)
Depreciation as per income
tax provisions
Nil 1.30 million
Rs. 26.91 million Rs. 30.00 million
Rs. 0.87 million Rs. 0.80 million
Total Interest (Non cash) Rs. 7.86 million Rs. 7.79 million
Income Tax rate (company is
paying only MAT @ 11.5% of
EBT)
Investment requirement in
working capital for operations
of the machine (assumed to be
released at the end of life of
the machine)
Rs. 2.08 million Rs. 1.74 million
Rs. 63.39 million Rs. 63.39 million
The interest was calculated on the aggregate of receivables, investment and the working capital. The
details for the proportion of different components of total interest are given in Table.
Table 2
Particulars Machinery I
Machinery II
Receivables Rs. 0.06 million Rs. 0.06 million
Investment (10.4% of the cost
of Machine)
Working Capital (10.4% of the
investment required in
working capital)
Rs. 1.21 million Rs. 1.12 million
Rs. 6.59 million Rs. 6.59 million
Total interest Rs. 7.86 million Rs. 7.79 million
After calculating the cash flows for the alternatives available, Swami decided to buy the first machinery.
The policy of the company was to discount the cash flows at the rate of 16.59%. the order for the machine
was placed in March 2000, with a delivery period of four months, and the machine was to be made
operational in July, 2000. The payment was released in April, 2000. The machine was received in July,
2000 but it could not be made operational due to damage in the transit. The machine was finally made
operational in October, 2000. The company was not able to generate revenues from that machine for the
same period. Apex finalized its balance sheet on June, 30 every year.
Questions:
1. If you were in the position of Swami, what would have been your decision? Justify keeping
qualitative aspects in mind.
IIBM Institute of Business Management 9
Examination Paper of Pharmaceuticals Management
2. Discuss the various other factors, which should be considered while making capital investment
decision.
Caselet 2
Geetha Laboratories Pvt. Ltd. Was established by Mohan Ramnath in 1985 at Chennai. He was a PhD in
Chemistry, a soft spoken gentleman who did not believe in working under pressure. The company was a
small scale unit manufacturing non-patented anti-malarial medicines. The company worked 6 days per
week and was running smoothly. In 1978, CITU supported union came into existence. Industrial relations
started deteriorating making it difficult for the company to service. In 1983, Ramnath decide to enter into
partnership with three other partners, Chandan Keshav, Bharat Pathak and Veenu Ramachandan to
overcome the difficulties faced by him. The company came to be known as Geetha Laboratories Ltd.
Even after this, industrial relations did not improve till 1990 and it was during this period that 14 workers
were sacked. In 1990, Ramnath decided to sell his shares to Emission Pharmaceuticals, a multinational,
though other partners continued. Now, the company was called German Drug House (GDH)
Pharmaceuticals. During this period CITU withdrew support to the union and BMS (Bhartiya Mazdoor
Sangh) came into the picture. An average increment of Rs. 225/- was given to all workers and industrial
relations improved to some extent.
IMPLA Pharmaceuticals Limited was another non-patented anti-malarial bulk drug manufacturing giant
having units at Poona, Mysore, Hyderabad, and Coimbatore and having corporate office at Baroda. It
wanted to have monopoly in anti-malarial drug manufacturing by taking over GDH, but before taking
such step, they wanted to assess the internal condition of the company. Therefore, in January 1994 Vishal
Shrivastav, a qualified Chartered Accountant, was inducted as Director by purchasing a requisite number
of shares of the company. In September 1994, after IMPLA was convinced about the favorable conditions
of GDH it formally took over the company. At that time the manpower strength of the plant was 210 in
which 130 were workers and 80 were executives and staff members. After taking over, IMPLA made
many changes and the major ones were:
1. They increased the salaries of executives and staff of the unit to reduce the gap in the pay
structure of the executives and staff of this unit and their other units.
2. They invested 3-4 crores for up gradation of the plant.
3. They shifted from 6 days working per week to 7 days working per week to improve the
productivity and enhance cost-effectiveness of the unit.
The shift from 6 days to 7 days working without any financial gains, made workers resists the change. At
this junction Sumeet Joshi, Corporate Manager, (IR) intervened and promised the workers that they
would be paid for 30 days instead of 26 days, but Ravi Shriman, Director (Personnel) and Vishal
Shrivastav; GM (operations) refused to agree to this since they were not involved when Sumeet Joshi
made the commitment. The promise was not fulfilled, further complicated problems. The issues kept on
lingering for 6 months. No decision could be taken because of the difference of opinion among senior
executives. In June 1995, the workers gheraoed Vishal Shrivastav to pressurize the management to take
the decision. They were successful to some extent as it led to the agreement of management with workers
that financial benefits would be given with retrospective effects of 4 years making it one additional year
over and above 3 years of normal agreement. They were asked to give a notice of change which the
Workers couldn’t give till December 1995 because of disagreement among themselves. It was felt at this
point of time by Shrivastav that the plant should have an Assistant Manager (Personnel) instead of having
a Personnel Officer. Ajit Dubey, Assistant Manager (Personnel) was appointed in October 1995 but even
this appointment took 3-4 months because of difference of opinion between shrivastav and Shriman.
In December 1995, the workers gave a notice of change demanding an increase of Rs. 2200/- per month.
In January 1996, a notice of change was given by management. In February 1996, the negotiations started
and continued till July 1996. Shrivastav, Rajkumar, the new Corporate Manager (IR), Ajit Dubey and
IIBM Institute of Business Management 10
Examination Paper of Pharmaceuticals Management
Kishore were to represent the management and nine members of the union were to represent the workers,
besides V.D. Agarwal, the General Secretary of BMS. The first two rounds of meeting did not lead to any
outcome as none of the parties were ready to budge. This made V.D. Agarwal withdraw as he was fed up
with the rigid stand of the union leaders.
The third meeting was held without Agarwal, wherein the union leaders came down to Rs. 1,200/- from
Rs. 2,200/- p.m. The minutes of the meeting were jotted down but the union leaders refused to sign.
Taking advantage of the occasion, Dubey and Shrivastav had a secret meeting with Agarwal in a hotel.
Agarwal advised the representatives of the management to maintain a low profile for a few months to
crack down the workers’ aspirations who had very high expectations. It was observed by Dubey that there
were perceptual differences between senior and junior union leaders. Taking clue from this, Dubey
adopted a policy of divide and rule and took into confidence Devilal, the senior union leader and had
secret meeting with him to explore the last settlement amount and apprised him that the management
could go only upto Rs 450/- . He also took Janak Singh, the junior union leader into confidence and
convinced him that the management was not going to bend before their demands and as such the workers
were going to be the ultimate sufferers. Besides this, Dubey spread the message that no wages would be
given retrospectively.
The next day the meeting resumed in which union representatives demanded Rs. 750/- (because of the
pressure from the workers) beyond which they were not ready to come down. It was decided that instead
of having a meeting with all the members, only two members, one senior union leader, Devilal and one
junior union leader, Janak Singh would sit in the negotiations. Immediately a meeting between
Shrivastav, Rajkumar, Devilal and Janak Singh was held and it was resolved that Rs. 575/- average per
month would be given for 4 years retrospectively. A MOU was drafted by the legal consultant at the
corporate office and was duly signed by Shrivastav, Rajkumar, Dubey and all the union representatives.
In the evening a dinner was hosted in which all the negotiators were invited. When the papers were sent to
R. Shriman, he objected to the MOU on the following points. First, the other plants were having 30 days
pay system leading to less average per day and in Chennai plant it was to be given for 26 days leading to
higher average per day. Second, the milk allowance given for overtime at Chennai unit was higher than
other units. it took Shrivastav and Rajkumar two months to convince Shriman about the agreement,
thereafter implementing the same. Rs. 14 to 15 lakhs were given to all the 160 workers within a week as
arrears and the issue was settled.
Questions:
1. Was it right for V.D. Agarwal to withdraw half way during negotiations?
2. In view of the information given in the case, suggest the strategies for making IMPLA
Pharmaceuticals a more progressive organization.
END OF SECTION B
IIBM Institute of Business Management 11
Examination Paper of Pharmaceuticals Management
Section C: Applied Theory (30 Marks)
This section consists of Applied Theory Questions.
Answer all the questions.
Each question carries 15 marks.
Detailed information should from the part of your answer (Word limit 200 to 250 words).
1. Explain the terms in the context of the “Pharmaceutical Marketing” :
a. Brand
b. Trademarks
c. Product line
2. Explain the important point that should be considered, while packaging pharmaceutical product?
Also list the various dimensions of pharmaceutical market.
ISBM / IIBMS / IIBM / ISMS / KSBM / NIPM
SMU / SYMBIOSIS / XAVIER / NIRM / PSBM
ISM / IGNOU / IICT / ISBS / LPU / ISM&RC
MBA - EMBA - BMS - GDM - MIS - MIB
DMS - DBM - PGDM - DBM - DBA
www.mbacasestudyanswers.com
ARAVIND 09901366442 -
09902787224
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