Eli Lilly: Developing Cymbalta Essay

The given discussion is based on Eli Lilly, a research-based pharmaceutical company. The first core strategy of Eli Lilly and company was to replace its premier drug “Prozac” before losing its patent. The second is differentiating the company and its brand. Lilly began concentrating and devoting its resources to other possible assets: R-fluoxetine, OFC (olanzapine-fluoxetine combination), 5HT2 Antagonist, SSRI, Business Development Opportunities, and Cymbalta (duloxetine) (Ofek & Laufer, p. 8). In the initial section of this document, the company’s strategic issues and problems will be analyzed.

In the next section of the document, an analysis and evaluation of several company related factors is performed which will help develop the facts. Finally, alternative solutions have been prepared, in relation to these actions, and some effective recommendations are also suggested for the firm’s enhanced future business. Identification of the strategic issues and problems: Since Eli Lilly and company started business, they have achieved tremendous success due to the provision of effective drugs for the treatment of depression. The company gained major success due to the sale of Prozac.

In the year 1990, several substitute products of Prozac such as Celexa, Zoloft, and Paxil were introduced in the market which had cut the market of Lilly. After two decades of its business success, the company experienced a major problem of downward product sales. The problem of the company is stated as downward falling in annual sales, due to shared market by competitors through the provision of effective substitutes. For the solution of this problem, there are several options, as well as, constraints pertaining to the company.

The main constraint of the company is specific treatment of its drugs. Less capital availability for clinical trials of drugs and time-consuming R;D process are the major restrictions. This problem can be solved by the firm, by introducing new products with low price and better quality and improvement in the R;D process for one of its drug named Cymbalta, which is having positive market response. Analysis and Evaluation: In order to survive in the pharmaceutical industry, companies have to invest a lot of volume on advertising and marketing.

The pharmaceutical industry is a highly competitive industry and incorporates a specific buyer and behavior. There are several competitors for a single drug. Drug products are manufactured with the assistance of the R ; D process. The Food ; Drug Association is required to ensure the safety of patients before approving the release of the new product to the market. Eli Lilly mainly produces drugs for the treatment of depression. The company has achieved a comparative level of revenue by offering innovative drugs for the treatment of these patients.

The patients also want the pain killing feature in the same drugs along with the removal of depression. The company had been confronted with lowered product sales due to increased competition from Pfizer, Johnson ; Johnson, GSK, etc. In addition to this, the buying habits of consumers are price-sensitive. The low-priced drugs with effective quality are preferred by the customers. As per the case, the success of other competitors is due to their lowered price of up to 80%. Eli Lilly, itself is a well-known and an affluent company.

Its drugs have occupied the global market for two decades. Now, it is launching new products with lower prices for regaining the original position again. Three Alternative Course of Actions: There are three suggested alternative course of actions with pros and cons analysis for each alternative for the resolution of the lowered sales volume and the firm’s shared market. The first alternative course of action for the company includes launching a product with a new feature such as a pain reliever.

This action would reach a large market segment and competition would be oppressed by the company’s move. The cons of this option- clinical trials are required, more expenditures on production process, time and labor for marketing of new product- increasing expenses for the company. Cymbalta should be launched first as an antidepressant. Followed by clinical trials, to launch as a double-standard drug for pain. The next alternative for the company is to conduct a preliminary market research.

Customer responses about existing drugs and competitor products are acknowledged to improve the production process. Again, this is a time-consuming process and requires detailed planning. It will also consume capital, which is limited due to lower product sales. The third alternative is to conduct more R & D on Cymbalta. Costumers seem to favor it. It will augment the business sales and increase annual sales. The competition will also be overcome with the introduction of such a drug. The cons of this option would be the disturbed business process due to excessive involvement of experts.

Recommendations: From among the given alternative course of actions, the R & D of Cymbalta drug is chosen as the best for Eli Lilly. It is better than all the other existing antidepressants for providing relief to the patients. Experts and skilled professionals should be employed in the R & D process of the new drug – Cymbalta. The company should conduct clinical trials periodically to test its efficiency. The drug should be developed with different criteria of prescription as per the severity of the depression and pain.

With the increased customer demand, the sales of the company would also increase. It is important for Eli Lilly and Company to develop an updated product that will undoubtedly outperform its competitors. The main focus should be to invest in R & D so that Cymbalta becomes a QD medication like the rest of its kind. This will require a lot of effort and resources from Lilly’s marketing team to educate consumers on the application and benefits of Cymbalta. This new drug has already been proven to be better than other antidepressants in the market and has no safety issues.