Sample Business Studies Paper on Creso Pharma Limited

1.    Introduction

Creso Pharma Limited, an Australia-based company, offers health products and hemp-derived extracts, oil and proteins. The primary business of the company is the development, registration and commercialization of pharmaceutical-grade cannabis and nutraceuticals products based on hemp. The company is headquartered at South Whales. The company’s product portfolio comprises of Therapeutics, Nutraceuticals, Animal Health,  Lifestyle and Topicals.

With of acquisition of Nova Scotia-based Mernova Medicinal Inc, a medicinal cannabis producer, the company formally entered into the Canadian markets.

The company has been pioneer in importing medicinal cannabis to the Australian markets. The company has been able to successfully launch innovative products like anibidol and  cannaOIX in the European markets. The success in European markets would pave entry into other markets of Australia, the Middle East, the Gulf region and Latin America for its nutraceutical products.


2. Business Model

The Creso business model is aimed at the development of a product portfolio comprising of Therapeutics, Nutraceuticals, Animal Health,  Lifestyle and Topicals, which meets the desired product standards.  In order to deliver high quality of products, Creso combines its in-house ingredients,  expertise of cannabis and hemp production technology with third party strategic alliances and proprietary knowledge.  (Dudin, Lyasnikov, Leont’eva, Reshetov, & Sidorenko, 2015)

2.1 Building Blocks

1. Customer segments-

  1. Creso’s customer base comprises of humans and animals, whose health and lifestyle can be improved through the use of cannabis and hemp- based products.
  2. Major Customer markets for Creso includes Australia, Canada, Israel, Europe and Latin America.

 2. Value propositions

  1. Unlock the potential of cannabis and hemp driven products for the betterment of animal and human health
  2. Striving for highest quality in its product portfolio

3. Channels

  1. Creso Pharma lacks a broad distribution and retail channels for the sale of its products.
  2. Alliance with distribution companies like Medi -In – SRO (for Czech Republic markets), Health House international (Australian markets), etc.
  3. Customer relationships: Creso has no direct customer relationships. Customer relationship is basically through the different wholesalers, dealers and retails outlets. (Osterwalder & Pigneur, 2010)




  1. Revenue streams – The company earns majority of its revenue from the sale of its products comprising: Therapeutics, Nutraceuticals, Animal Health, Lifestyle and Topicals.
Particulars 2018 ($) 2017($)
Revenue from Operations    
Sale of Products 558,382 91,609
Royalty Income 19,840 1,112
Other income in form of interest received, lease income, etc. 153,358 97,341
Total Income 731,580 190, 062


  1. Key resources –
  2. Human resources – Board members with extensive experience in the running of pharmaceutical companies and dedicated management team equipped with the required industry talents and skills.
  3. Financial Base – Strong financial base with sufficient cash in hands to support operations for the next 18 months.
  • Favourable Regulatory Policies – The governments legalizing the use of medicinal cannabis
  1. Strategic Alliances and Acquisitions of partners leading to establishment of Creso worldwide.


7. Key activities

  1. The primary business of the company is the development, registering and commercialization of pharmaceutical grade cannabis and nutraceuticals products based on hemp. The company is headquartered at South Whales.
  2. The company’s product portfolio comprises of Therapeutics, Nutraceuticals, Animal Health, Lifestyle and Topicals.

8. Key partnerships

  1. Strategic alliance with Israel based Cohen Propagation Nurseries Ltd for cultivation of cannabis products
  2. Acquisition of Canada based Kunna Canada Ltd and its subsidiaries that establishes Creso in the Colombian and the Latin America Markets of Argentina, Colombia, Chile, etc.
  • Acquisition of Canada based Mernova Medicinal Inc establishing Creso as the only Australian cannabis company in the Canadian markets. (Osterwalder, Pigneur & Tucci, 2005)

9. Cost structure

  1. The company is based on cost driven wherein the overall production and manufacturing price of the product determines the cost of the product.
  2. The various expenses like administrative, legal, employee, exclusivity and finance stand at $8,017,327 in the year 2018.


2.2 Key interrelationships that exist across the nine building blocks

Strong interrelationships between the basic building blocks is quintessential for any successful organization. Creso’s key activity i.e. development, registering and commercialization of pharmaceutical grade cannabis and nutraceuticals products is directly complemented by the key resources at the disposal of the company. The company leverages its experienced management team and strong financial base coupled with the favourable regulatory policies to achieves its overall objectives and value propositions.  (Osterwalder & Pigneur, 2010)

The key partnerships that Creso is establishing in the form of joint ventures, acquisitions and mergers is further helping the company to enter into new markets and customer reach. Such alliances with key industrial players are leverage the technological expertise of its partners to further deliver better results for its investors and stakeholders.

The products manufactured by Creso finds its application in the human and animal lifestyle options. In order to ensure that its products reach its end consumers, the company is leveraging various customer channels like distribution networks and partnership with wholesalers and dealers. (Lambert, 2006)

Through its broad product portfolio, Creso has created a diversified revenue stream for itself. Such a diversified revenue steam shields the company from unfavourable market conditions. Being a new company, the cost of operations is significantly high compared to its revenue base. One of the reasons for the huge expenses of the company is active strategic alliances and partnerships with key industrial players.


3. Critical success factors

Creso is a geographically diversified and an integrated company.

  • Creso Pharma is being led by a Board with rich experience in large pharmaceutical companies and deep relationships with key institutions across the world . The management team is highly skilled and talented.
  • The company has created a diversified revenue stream. This includes sale of its product portfolio to human and animal health markets.
  • Strategic acquisitions and mergers with partners like Kunna Canada Ltd, Mernova Medicinal, Cohen Propagation, etc. Such alliances are helping the company to enter into new geographical boundaries and markets. Such transactions create synergies in the company helping Creso to create a diverse differentiated product range and wide manufacturing base.
  • In order to expand its supply chain and distribution channels, the company is aggressively partnering with clients such as Precision healthcare, Health house international, etc.
  • Increasing legalisation and worldwide global recognition by governments for the medicinal usage of cannabis leading to creation of large markets for the company’s products. Various research is underway for the discovery of arenas of application of medicinal cannabis.  (Leung, 2011)


4. Downside Risks

Creso Pharma is an emerging company operating in a rapidly developing industry. Some of the major risks that has the potential to stagger the growth of the business includes:

  • Creso operates in a market wherein the regulatory framework is highly unpredictable. Any unfavourable regulatory framework will be a direct blow to the company.
  • Lack of broad distribution channels and retail outlets creating a wider customer reach for the company. (Penn, 2014)
  • Currently, the target market is a niche market with limited number of players. However, the number of competitors in the market is increasing with the increasing global markets, leading to scarcity of resources in the market. Further, the market will witness industry consolidation further restricting access to key partners. On the other hand, Creso has been actively pursuing strategic partnerships to expand its portfolio and geographic reach. (Gautam & Pan, 2016)
  • Presently, Creso’s product cannabis as a suitable medicinal product faces an unknown level of acceptance and support among the wider community. Thus, it is difficult to determine/predict the consumer demand for such products.

5. Business model changes

Creso Pharma has established itself as a global pharma company. The present strategy of the company is assisting the company to accomplish its objectives. However, given the highly uncertain regulatory environments and other issues, I would tweak the existing business model to accommodate the following changes:

  • There is a lack of awareness about the medicinal applications of cannabis products. The company should release a series of videos on its product portfolio and their applications on various consumer platforms. The company should also deploy various social media platforms like Facebook, LinkedIn, YouTube, etc to engage with its customers and create awareness about its products. (Sleigh & Barton, 2010)
  • Such awareness about its product portfolio will also help Creso generate acceptance and support from the wider consumer base (Gautam & Pan, 2016).
  • Creso lacks a proper distribution channel enabling its products to reach the end consumer. Hence, the company should invest in retail outlets so as to directly sell the products to its customers. Additionally, the company should also launch an online website that allows customers to purchase directly.

6. Conclusion

Creso Pharma operates in a rapidly growing market. Over the three years of its inception, the company has established itself successfully with manufacturing bases across the world. The company has strongly leveraged the channel of joint ventures, mergers and acquisitions to establish itself in this highly uncertain market.

7. Recommendations

Based on the analysis if Creso Pharma’s business model, major success factors and risks faced by company, the company should incorporate the following recommendations in its business model.

  • Strong marketing of its product to create awareness about the medicinal applications of cannabis.
  • Wider consumer base would help the company generate the needed market support.
  • Investment in setting up retail outlets for its products in the major markets.




Andersson, T., Gleadle, P., Haslam, C., & Tsitsianis, N. (2010). Bio-pharma: A financialized business model. Critical Perspectives on Accounting21(7), 631-641.

Dudin, M. N., Lyasnikov, N. V. E., Leont’eva, L. S., Reshetov, K. J. E., & Sidorenko, V. N. (2015). Business model canvas as a basis for the competitive advantage of enterprise structures in the industrial agriculture. Biosciences Biotechnology Research Asia12(1), 887-894.

Enyinda, C. I., Mbah, C. H., & Ogbuehi, A. (2010). An empirical analysis of risk mitigation in the pharmaceutical industry supply chain: A developing‐country perspective. Thunderbird International Business Review52(1), 45-54.

Gautam, A., & Pan, X. (2016). The changing model of big pharma: impact of key trends. Drug discovery today21(3), 379-384.

Gilbert, J., Henske, P., & Singh, A. (2003). Rebuilding big pharma’s business model. IN VIVO-NEW YORK THEN NORWALK-21(10), 73-80.

Lambert, S. (2006). A business model research schema. BLED 2006 Proceedings, 43.

Leung, L. (2011). Cannabis and its derivatives: review of medical use. The Journal of the American Board of Family Medicine24(4), 452-462.

Mittra, J. (2007). Life science innovation and the restructuring of the pharmaceutical industry: Merger, acquisition and strategic alliance behaviour of large firms. Technology Analysis & Strategic Management19(3), 279-301.

Osterwalder, A., & Pigneur, Y. (2010). Business model generation: a handbook for visionaries, game changers, and challengers. John Wiley & Sons.

Osterwalder, A., Pigneur, Y., Oliveira, M. A. Y., & Ferreira, J. J. P. (2011). Business Model Generation: A handbook for visionaries, game changers and challengers. African journal of business management5(7), 22-30.

Osterwalder, A., Pigneur, Y., & Tucci, C. L. (2005). Clarifying business models: Origins, present, and future of the concept. Communications of the association for Information Systems16(1), 1.

Veit, D., Clemons, E., Benlian, A., Buxmann, P., Hess, T., Kundisch, D., … & Spann, M. (2014). Business models. Business & Information Systems Engineering6(1), 45-53.

Rousseaux, C. G., & Schachter, H. (2003). Regulatory issues concerning the safety, efficacy and quality of herbal remedies. Birth Defects Research Part B: Developmental and Reproductive Toxicology68(6), 505-510.

Penn, R. A. (2014). Establishing expertise: Canadian community-based medical cannabis dispensaries as embodied health movement organisations. International Journal of Drug Policy25(3), 372-377.

Sleigh, S. H., & Barton, C. L. (2010). Repurposing strategies for therapeutics. Pharmaceutical Medicine24(3), 151-159.