Identifying the Future Plans of Pharmaceutical Companies Accepted in the Tehran Stock Exchange: A Qualitative Content Analysis Approach

Document Type : Original Article

Authors

1 Associate Professor, Business and Management Department, Shahid Beheshti University, Tehran, Iran.

2 M.A., Business Administration, Business and Management Department, Shahid Beheshti University, Tehran, Iran.

3 Ph.D., Pharmacoeconomics, Department of Medical Sciences, Shahid Be-heshti University, CEO of Tehran National Innovation Fund, Tehran, Iran.

Abstract

Aim and Introduction: As one of the strategic industries, the pharmaceutical industry contributes significantly to the global GDP. Moreover, due to its ability to generate higher added value compared to other industries, it is one of the most profitable industries in the world. Regarding the profitability of this industry, its impact on human health and survival, and the allocation of significant financial resources to import and production in Iran, studying the plans of pharmaceutical companies is vital. In this research, the prospective plans of Iranian pharmaceutical companies have been classified and prioritized.
 
Methodology: The methodology used in the current study is qualitative content analysis, as this approach offers researchers numerous advantages. Qualitative content analysis can be easily applied to any type of written document. Besides this, it provides researchers with the opportunity to comprehend the significance of social reality and social phenomena. Moreover, another advantage is the ability to analyze a large volume of data using the aforementioned methodology. Qualitative content analysis is divided into two different types: deductive and inductive. The difference between these two approaches lies in the method of deriving codes from raw data and categorizing the data. In inductive content analysis, codes and categories are directly derived from raw data. In deductive content analysis, researchers have a predetermined framework based on previous studies or the theory being used in the study. They then organize the data according to this preconceived structure. According to what was mentioned, inductive content analysis was used to study, classify, and prioritize the plans of pharmaceutical companies listed on the Tehran Stock Exchange. A selection of Iranian pharmaceutical companies that have been listed on the Tehran stock market has been made using purposive sampling. The plans of 34 out of 44 companies, whose annual reports of the board of directors ending in 2021 could be accessed from codal.ir, were analyzed and classified through content analysis. Out of the 44 companies, five did not mention their plans in their annual reports. Moreover, the content of the plans of the two companies was not related to sales, marketing, or foreign trade. Of the remaining thirty-seven companies, three were wholesale and distribution companies. These companies were omitted from the study due to the different nature of their activities and smaller quantity compared to the medicine manufacturing companies.
 
Findings: As a result of the analysis of plans, a total of 3 main themes (market and marketing, supply chain and profitability), 18 sub-themes, and 65 codes were identified which were divided into three main categories: market and marketing, value chain and profitability. Among the identified themes, the diversity of the product portfolio is the most frequently mentioned theme in both the main theme of market and marketing, as well as among all 18 sub-themes.
 
Discussion and Conclusion: In the pharmaceutical industry, the research and development unit is considered one of the most critical parts of each company, and the approval of a new medicine is one of the most important outcomes of the entire industry. This is something that has received attention among manufacturers in Iran's pharmaceutical industry. Based on the findings of this research, the theme of product development has the highest frequency among the three codes related to the diversification of the company's product portfolio (product development, line extension, and obtaining licenses and permits for product development), accounting for 58 percent of the total. Profitability, as a sub-theme, ranks second among the sub-themes with a share of 47.05 percent. What is important here is that government-mandated price controls are a factor that has reduced their profit margins by increasing the financial costs imposed on pharmaceutical companies. Thus, it leads companies in the pharmaceutical industry to plan new programs to enhance their profitability. As a result, several programs have been taken into consideration by these companies to increase profitability. These programs include cost control, production of profitable products, efficiency of purchasing operations, economies of scale, production efficiency, cheaper types of financing, and product line pruning. Among all the sub-themes, the export development theme ranked third with a share of 41 percent. Among the codes related to exporting - obtaining export licenses, market development, market penetration, developing the portfolio of exported products, removing legal obstacles, global market research, and increasing exports using regional agreements - market development and market penetration have the highest frequencies in this section, with 20.58% and 11.76% respectively. Another main theme that has been specifically noticed by pharmaceutical companies is related to the supply chain. Among all the 65 primary codes identified in this research, the code for supplier portfolio diversification, which falls under the sub-theme of supply chain development, has the highest frequency. This indicates the recognition of the importance of supply chain management by pharmaceutical companies in Iran. However, it seems that Iranian pharmaceutical companies have not given enough attention to all dimensions and components of supply chain management in their future plans. This is evident from the fact that the codes related to the sub-themes of value creation with partners (internal and external development) and optimization of the distribution system had the least frequency among the primary ones.

Keywords

References

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Commercial Strategies
Volume 19, Issue 19
December 2022
Pages 23-1

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