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Investment & Commercial Due Diligence
Task:
Assess the risks of participating the CLient in investing in the Target
Task:
Assess the risks of participating the CLient in investing in the Target
Client:
EBRD
Region:
The largest local pharmaceutical manufacturer
Deliverables:
- An independent assessment of the investment project.
- Revision of the information provided by the Target and the Client.
- In-depth research of the core Target's pharmaceutical market.
- A set of interviews with Target's top management with insights and recommendations.
Overview of operations, management resources, and staffing:
- Conduct interviews with Target’s top managers and assess their management capacity and skills to implement Target's business plan and long-term strategy.
- Assessment of the key functions within Target, i.e. production, sales and marketing, R&D.
Investment program:
- Help the Client by assessing the key components of the Investment Program related to the Client's financing of the R&D laboratory's modernization and Target’s equipment procurement process. Supported in the verification of whether the proposed CapEx costs of the project were in line with the current market prices and represent good value for money and/or that Target will apply transparent procurement practices or not.
Business plan:
- Review Target’s business plan and opined on key assumptions behind Target’s long-term financial and operating projections, including revenue growth, production costs and operating expenses dynamics, profitability, required capital expenditures for R&D modernization, working capital management. Compared Target’s assumptions for key indicators with the industry standard.
Product portfolio, pipeline, and production:
- Review of Target’s product portfolio focusing on key products comprising [70]% of the Target’s consolidated revenues
- Assess Target’s product pipeline and expansion plans focusing on its competitive edge and launching program.
- Ability and registration power in other targeted countries including EU. Evaluation was based on a sample of 2-3 dossiers (1 developed dossier which was already in compliance with the EU standards and 1-2 dossiers been upgraded to the EU standards).
- High-level review of the Target’s existing production facility, GMP compliance and production practices, including procurement, quality control, etc., and benchmark vs. industry best practices.
Key areas covered in the project:
- Market trends, sustainability of Target’s competitiveness, and ability of Target to defend its market position.
- The capacity of Target to implement a part of the investment program related to the modernization of R&D laboratories, confirming the presence of required expertise.
- Target's strategy, investment program, and business plan.
- The management competence and capacity to implement this strategy
Market analysis & competitive position:
- General market overview with key players, total expenditures on pharmaceuticals, GDP/capita expenditures, the market size of local pharmaceutical manufacturing industry, description of the market including boundaries, i.e. where the project competes geographically and sector-wise.
- Key drivers, growth trends, and prospects of generic drugs for the next 5 years. Special focus should be made on the key segments and export countries targeted by Target.
- Assess Target and the competitiveness of its products (i.e. competitive advantages) in key targeted market segments, including export countries (Poland, Uzbekistan, and Kazakhstan).
- Describe the level of competition (local/international) and Target’s peers on the market. In respect of main market segments currently targeted by Target or proposed to be targeted, assess growth trends and growth market drivers and assumptions over 2019-2024 with indication a source of data, key players and their market shares, the Target’s existing and potential market share.
- Export opportunities to neighbor markets, analyze market trends in Target’s export countries (Poland, Uzbekistan, and Kazakhstan).
- Target’s marketing strategy for domestic (Ukrainian) and other targeted markets and segments including pricing policy, logistic and distribution channels, advertising/promotion.
- Describe the project’s impact on the market.
- Potential competitive threats including future entrants in the market of Target’s operation and international competition - main international suppliers, import parity prices, import taxes and duties, import/export regulations.
- Market entry barriers locally and in targeted markets.
Project
leads
Jonas TRYGGVASON
Managing Partner
Eugene BROVKO
Partner, Pharma & MedTech Market Access
Anastasiya MAXIMENKO
Partner, Recruitment & Organizational Development
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