Paper on Factors that Affect Sustainability of a Pharmaceutical Firm


Every organization functions in an attempt to not only generate profit but to be sustainable and remain viable in the industry.  Sustainability of a firm is the ability of the business to alleviate risks that could potentially compromise its overall output and profitability (Valente 132). While managing a pharmaceutical company, it is essential to integrate the need to consider the impact of its activities on the environment and natural resources into the sustainability concept. In an effort to balance between cost saving and remaining competitive in the business, it is crucial that as the manager of this firm one be keen to understand other factors that affect sustainability.

Firstly, competitor’s take over is a managerial issue that threatens the sustainability of most pharmaceutical firms. The competitive nature of the global market calls for other companies in the industry to produce generic products which directly or indirectly impact on the market share of the existing businesses. The inability of business managers to evaluate and analyze the performance of the firm at a particular time and coming up with strategies to continue their operations relative to the competition leaves them vulnerable and at risk of closure.

In addition, competitor’s who easily adopt new technology that minimizes resource use while optimizing output subsequently takes over the market. By using less of the resources, the competitor’s stand a better chance at operating for longer and the increased output presenting them with the opportunity to generate more profit. As a manager of a firm facing competition takeover, it is vital to critically conduct an analysis of the current technology used in the company and identify the gap. It would be of significance to invest in emerging technology to increase output as well as in training of the staff members to improve their skills.

Secondly, government regulations pose an imminent threat to pharmaceutical companies that are not flexible and fail to come up with effective strategies of operation. To operate at a competitive advantage, it is significant that a firm understands and adheres to government policies in place to ensure sustainability. For instance, it is crucial that the company act in accordance to waste management and disposal regulations put in place to ensure environmental sustainability.

Consequently, taxation as a government policy, directly and indirectly, impacts on sustainability. By imposing high taxes on raw materials, domestic production is hampered which could potentially result in high cost of products. The high prices result in loss of market advantage for the firm with individuals opting for cheaper generic products. On the other hand, high taxation on imported pharmaceutical products results in increased local production. Finally, government regulations are dependent on the political stability of the country which in turn impact on business. Policies formulated in the politically stable country are more enabling to firms as opposed to those in unstable countries.

To remain viable on the market, the pharmaceutical firm manager should come up with strategies that allow them to overcome the challenges. To begin with, one should identify the core competencies of the business that offer the advantage over their competitors (Tur-Porcar, Roig-Tierno and Llorca Mestre 452). By differentiating the business from the competitor’s, the firm protects its market share while generating the much-needed profits. Application of marketing strategies to promote their products is also significant in establishing sustainability.

Finally, firms should acquire knowledge and understanding of sustainability drivers present in the market. Strategically, the management should adopt new technology that minimizes on resource use while optimizing output. It is also essential that the firm comes up with a holistic structure of financial management to facilitate decision-making that aligns with the need for sustainability.



Works Cited

Tur-Porcar, Ana, Norat Roig-Tierno, and Anna Llorca Mestre. “Factors Affecting Entrepreneurship And Business Sustainability.” Sustainability 10.2 (2018): 452. Web:

Valente, Mike. “Business Sustainability Embeddedness As A Strategic Imperative.” Business & Society54.1 (2012): 126-142. Retrieved from: