Harvard Case - GlaxoSmithKline in Brazil: Public-Private Vaccine Partnerships
"GlaxoSmithKline in Brazil: Public-Private Vaccine Partnerships" Harvard business case study is written by Arthur A. Daemmrich, Ian McKown Cornell. It deals with the challenges in the field of Business & Government Relations. The case study is 15 page(s) long and it was first published on : Jun 11, 2012
At Fern Fort University, we recommend that GlaxoSmithKline (GSK) continue to engage in public-private partnerships (PPPs) with the Brazilian government, focusing on strengthening the existing framework and expanding the scope of collaboration. This strategy should prioritize the development and distribution of essential vaccines, particularly those targeting neglected tropical diseases, while addressing concerns related to transparency, pricing, and intellectual property rights.
2. Background
This case study examines GlaxoSmithKline's (GSK) involvement in Brazil's public health system through PPPs, specifically focusing on the provision of vaccines. The case highlights the complexities of navigating the Brazilian political landscape, including navigating government policies, regulations, and political pressures. GSK's efforts to secure government contracts and secure favorable trade policies are crucial to its success in the Brazilian market.
The main protagonists in this case are GSK, the Brazilian government, and the Brazilian population. GSK seeks to expand its market share and profitability while contributing to public health. The Brazilian government aims to improve public health outcomes and access to essential healthcare services for its citizens. The Brazilian population benefits from improved health and well-being through access to vaccines.
3. Analysis of the Case Study
This case study can be analyzed through the lens of strategic partnerships, corporate social responsibility, and government relations.
Strategic Partnerships: GSK's PPPs with the Brazilian government are strategic in nature, allowing them to access a large market and leverage the government's infrastructure for vaccine distribution. This strategy enables GSK to achieve its business objectives while contributing to public health.
Corporate Social Responsibility: GSK's engagement in PPPs demonstrates its commitment to corporate social responsibility. By providing access to essential vaccines, GSK is contributing to the well-being of the Brazilian population, particularly vulnerable groups.
Government Relations: GSK's success in Brazil hinges on its ability to navigate the complex political landscape and build strong relationships with government officials. This includes understanding and adapting to changing government policies, engaging in lobbying efforts, and ensuring regulatory compliance.
Key Issues:
- Transparency and Pricing: The case highlights concerns regarding transparency and pricing in GSK's PPP agreements. Ensuring fair pricing and transparency is crucial for building trust with the government and the public.
- Intellectual Property Rights: GSK's intellectual property rights are a key concern for the Brazilian government, which seeks to promote local vaccine production and reduce dependence on foreign companies.
- Political Instability: Brazil's political landscape is characterized by frequent changes in government and policies, creating uncertainty for GSK's long-term investments.
4. Recommendations
- Strengthen Existing Partnerships: GSK should focus on strengthening its existing PPPs with the Brazilian government, ensuring transparency and fairness in pricing and procurement processes.
- Expand Scope of Collaboration: GSK should explore expanding the scope of its partnerships to include areas like research and development, local vaccine production, and capacity building for the Brazilian healthcare system.
- Address Concerns Regarding Transparency and Pricing: GSK should proactively address concerns regarding transparency and pricing by implementing robust mechanisms for price negotiation and public disclosure of agreements.
- Negotiate Flexible Intellectual Property Agreements: GSK should negotiate flexible intellectual property agreements that allow for technology transfer and local vaccine production, fostering innovation and reducing dependence on foreign companies.
- Build Strong Relationships with Key Stakeholders: GSK should invest in building strong relationships with key stakeholders, including government officials, healthcare professionals, and civil society organizations.
- Develop a Comprehensive Political Risk Management Strategy: GSK should develop a comprehensive political risk management strategy to mitigate the impact of political instability and policy changes.
- Prioritize Development and Distribution of Essential Vaccines: GSK should prioritize the development and distribution of essential vaccines, particularly those targeting neglected tropical diseases, aligning with the Brazilian government's public health priorities.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: GSK's core competency lies in vaccine development and distribution. Engaging in PPPs aligns with its mission to improve global health.
- External Customers and Internal Clients: The recommendations consider the needs of the Brazilian government, healthcare professionals, and the Brazilian population.
- Competitors: GSK should consider the competitive landscape and the presence of other pharmaceutical companies in the Brazilian market.
- Attractiveness: The recommendations are attractive as they aim to increase GSK's market share, profitability, and contribution to public health.
- Assumptions: The recommendations assume a stable political environment and a commitment from the Brazilian government to public health initiatives.
6. Conclusion
By pursuing a strategic approach to PPPs, GSK can achieve its business objectives while contributing to the well-being of the Brazilian population. This requires a commitment to transparency, fair pricing, and addressing concerns regarding intellectual property rights. GSK's success in Brazil hinges on its ability to navigate the complex political landscape and build strong relationships with key stakeholders.
7. Discussion
Alternatives:
- Exiting the Brazilian market: This would be a short-sighted decision, as Brazil represents a significant market opportunity for GSK.
- Focusing solely on private sector sales: This would limit GSK's impact on public health and potentially lead to higher prices for vaccines.
Risks:
- Political instability: Changes in government or policy could disrupt GSK's operations.
- Transparency and pricing controversies: Public scrutiny could damage GSK's reputation.
- Intellectual property disputes: Legal challenges could hinder GSK's operations.
Key Assumptions:
- The Brazilian government will continue to prioritize public health initiatives.
- GSK will be able to navigate the political landscape effectively.
- The Brazilian population will continue to demand access to essential vaccines.
8. Next Steps
- Develop a detailed implementation plan: This plan should outline specific actions, timelines, and resources required to implement the recommendations.
- Establish a dedicated team: This team should be responsible for managing GSK's PPPs in Brazil and coordinating with relevant stakeholders.
- Conduct regular monitoring and evaluation: GSK should regularly monitor the progress of its PPPs and evaluate their impact on public health outcomes.
- Engage in ongoing dialogue with stakeholders: GSK should maintain open communication with the Brazilian government, healthcare professionals, and civil society organizations to address concerns and build trust.
By taking these steps, GSK can ensure the long-term success of its PPPs in Brazil and contribute to the well-being of the Brazilian population.
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Case Description
Three years into a major public-private partnership between GlaxoSmithKline and Fiocuz, Brazil's principal health institute, the company assesses technology transfer and joint research under the agreement. GSK was selling its Synflorix vaccine (against pediatric pneumonia) at fixed prices even as it transferred technology and know-how to Brazil for eventual domestic production. At the same time, GSK was co-sponsoring research into a new vaccine for Dengue fever with the Brazilian government. GSK's management must consider whether the PPP provides strategic advantage to its consumer healthcare businesses in Brazil and to access other emerging markets as well as the risks posed by the aggressive product obsolescence built into the technology transfer agreement.
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