Johnson & Johnson SWOT Analysis

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Johnson and Johnson

Strengths

  • Worldwide sales have grown 14% indicating a strong position for the global group.
  • The business model adapted by Johnson and Johnson fundamentally uses the adaptation of entrepreneurial values in order to retain an edge within the market place.
  • Working with intensive scientific notions Johnson and Johnson utilise a varied expanse of problem solving techniques in order to challenge the standard practice and capitalise on growth through emerging markets which enables associated growth.
  • The use of independent offices working as standalone units provides the opportunity to develop concepts with cultural considerations which can prove important when taking a product to global markets.

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Weaknesses

  • There is increasing pressure within pharmaceutical markets to reduce prices in line with medical budgets and maintain patent expirations to ensure generic programmes are updated within critical path movements.
  • Challenges have been faced within Johnson and Johnson where a reduction in the market demand for key products has been identified; some of these products were branded and have been replaced by generic programmes at the end of patent time lines.
  • Internal weakness across the industry and not isolated to Johnson and Johnson would be the level of theft and counterfeiting of drugs managed through internal personnel.

Opportunity

  • Whilst the recent acquisition of Pfizer Consumer Healthcare will act as an opportunity in its own right to promote growth for the organisation through alternative routes there is the added value capitalised through the return on investment which will be realised 12 months before plan releasing funds back into the bottom line.
  • Johnson and Johnson have highlighted new developments in pharma products with five undergoing regulatory review which provides the opportunity to grow the existing product portfolio.
  • Development into new functions of medical devices and diagnostics will provide new markets to entry which will result in business growth.
  • With the development of WTO rules to prevent the availability of cheap generic drugs there is the opportunity to reduce the level of lost profit due to generic introduction as patents run out. Whilst this will aid Johnson and Johnson where they own the brand where they are looking to capitalise on introducing generic drugs to market this ruling will become a hindrance.

Threats

  • Generally within the main pharmaceutical companies there is a high level of competition for the generics markets where patents finish and it is the first to entry where success will generally be determined.
  • Technological developments with bio-tech concepts will potentially move the traditional pharmaceutical methods out of the market place in the long term although there is an economical argument that this form of development can be segregated to run alongside traditional methods and complement as opposed to replace.

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