Factors Influencing The Future Of The Biosimilars Industry In USA

Abstract

The increasing complexity of organisations and the changing environment they operate in has led to an increased need for studying strategic decision-making (Miller, Hicksen & Wilson, 2002). Strategic decisions are of critical importance to the firm in order to ensure business and financial performance and long term survival (Jocumsen, 2004, p.66). Planning long-term decisions require a rigorous evaluation of the environment. More thorough methods of assessing the future are required as companies seek to position themselves in the optimum position available in their complex external environment. The traditional method of forecasting future trends relied on extrapolation of historic data. This was limited as companies could only plan for a single future outcome. However in today's complex environment new techniques are required. For example, scenario planning relies on creating multiple scenarios and develops story-lines that ultimately serve to increase the knowledge of the macro-environment firms operate in (Van Der Heijden, 2005). The process allows decision-makers to gain insight into the current and evolving industry landscape and integrate this into their decision making (Fahey, 2000). Biosimilars manufacturers and other industry stakeholders are attempting to make profitable decisions based partly on future expectations (Bain, 2009; 'Be Prepared', 2010). As with any industry in general the biosimilars industry is characterised by complexity as well. A vast range of legal, regulatory, economic, political and other barriers impinge on their successful operation and must be overcome for firms to remain competitive into the future (Covic & Kuhlmann, 2007). Furthermore, in today's industry these issues may take a new dimension, with increasing complexity in government regulation and policy uncertainties (Fuhr, 2009; Gottlieb, 2008; Weschler, 2011). This research introduced the scenario analysis tool to the biosimilars industry in an attempt to address the increasing complexity of biosimilars firms and the environment they operate in. A qualitative exploratory study of the biosimilars industry was undertaken where a triangulation approach was used. Data was collected through semi-structured interviews, literature and a case study of Alchemia Ltd (an Australian Biotechnology firm). Future research is required to study the role of scenario analysis in the strategic planning process of companies in the biosimilars industry.