Novak Pharma: Industry Analysis

The CIMA November 2018 SCS exam is based a pharmaceutical company “Novak Pharmaceuticals” – as the exam is approaching it’s a good time to take a look at some industry analysis that you can use on exam day.

Novak Pharmaceutical’s: Industry Analysis

VIVA Financial Tuition have produced an insight to the pharmaceutical industry for SCS students to get to grips with – below is a look at some of the financials in the industry as well R&D within the industry.

Revenue’s Vs Profits

The pharmaceutical industry is one of the largest industries in the world in terms of revenues generated and those revenues have grown considerably in the last 15 to 20 years.

In 2001, annual world revenues for the pharmaceutical industry stood at US$ 390 billion.

Today, they have already surpassed US$ 1 trillion per year.

To put it in perspective, that accounts for around 1% of the entire world GDP! The sheer size of the industry in absolute terms often leads to a popular perception that this is also one of the most profitable industries in the world today.

However, although profits can be large in any given year, if we look at the rate of return on investment in the pharmaceutical industry, it is not as profitable as popular opinion suggests.

According to Pharmaceutical Research and Manufacturers of America, the average return on equity for key industries from 2014 – 2016 shows that the pharmaceutical industry’s profits stand at 16.2%, significantly lower than Computer Sciences (31.6%), Beverages (27.4%), Aerospace/Defense (23.0%), and Trucking (19.1%).

So despite health revenue growth figures in recent years, and large profits in absolute terms, relative to investment, it is not the most profitable industry in the world by any means.

SCSIndustry.png

Clinical Trial Phases

The research and development phase in this industry is long, painstaking, and has an extremely high failure rate. In the full analysis we investigate the reasons why this is the case.

Here, we offer a quick overview of the structure of the testing period for new drugs, and look at the fail rates that correspond to each.

There are 4 main stages or phases of testing that new drugs go through.

First, there are pre-clinical trials. These are usually a battery of sophisticated laboratory tests, in which pharmacists and technicians perform provisional tests on the efficacy of a chemical compound by using biological cultures, disease samples, and in some cases (though less and less frequently), animal testing.

Once promising indications of efficacy have been established at this pre-clinical stage, the drug passes on to testing on human subjects. This is usually called “Phase 1” testing. In Phase 1, voluntary human subjects are administered the drug.

These subjects are typically healthy and are not suffering from the relevant disease or ailment. The primary aim of this phase is to determine whether or not there are any strong adverse side-effects, and appropriate dose thresholds.

If there are no clear problems at this stage, the drug proceeds to Phase 2 trials. Phase 2 usually involves a larger sample of people, and in this case, the drug is tested on people who actually suffer from the relevant disease. The main objective of Phase 2 testing is to ascertain and confirm the efficacy on real human patients, while again ensuring no adverse side effects in those actually suffering from the disease.

If there appear no obvious problems here, the drug is submitted for the final Phase 3 trial. This is a much larger trial, typically taking in hundreds or even thousands of patients where possible, over longer periods, in order to establish long-term usability and efficacy.

One of the main aims of Phase 3 testing is to compare the long-run efficacy and safety of the new drug with already-available medications that are on the market. Once Phase 3 testing is successfully completed, the drug is submitted for approval with the relevant regulatory authority (e.g. the FDA in the United States, or the PTA in the pre-seen case of Novak).

Success Rates

SCSIndustry2.png

It’s interesting to note the success rates in percentage terms from one phase to the next. As you can see in the chart above, the main hurdle is at Phase 2.

This is perhaps not surprising, as this is typically the first time that the drug is tested on real patients who actually suffer from the disease.

Even if in Phase 1 no adverse side effects are discovered, there is no guarantee that patients with the disease will not react differently due to their ailment.

Moreover, there is no guarantee that the provisional efficacy established in pre-clinical trials on isolated biological samples (or animals) will carry over into real, full human subjects.

Therefore, Phase 2 is critical from the point of view of determining whether or not the drug is really viable in the real world.

Once all the clinical trials have been completed in accordance with criteria established by the regulatory authority, then there is an 85% chance that the drug will be approved.

However, when we sum the probabilities and we look at the overall chances that any given drug will make it from pre-clinical trials to approval, the percentage plummets to just over 9%!

Put another way, there is a 91% chance that any given drug will not be saleable at the end of an approximately 10-year cycle of testing! Not surprisingly, research and development in this industry is very expensive indeed…

The full industry analysis on the November 2018 CIMA strategic case study from VIVA Financial Tuition can be found at www.vivatuition.com

*The above industry analysis article was taken from the VIVA Financial Tuition website with permission 19/10/2018
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CIMA SCS May 2018: Couchweb

2018-04-23 12_39_10-May 2018 SCS - Pre-seen Material for students.pdf

Students sitting the SCS exam May 2018 will be dreading the next few weeks ahead of them, but to honest it’s where we (as students) all want to be! One more exam!!

CIMA released the pre-seen materials for the May 2018 SCS exam Couchweb a couple of weeks ago, so you should already be well versed with the materials. Below are a few visual aids to help you on your way.

You can find the official SCS Couchweb pre-seen analysis from CIMA here. 

Couchweb: Pre-Seen Analysis

Here it begins. The pre-seen analysis video from Astranti below will get the ball rolling for your SCS exam next month.

You can find the full set of videos on the May 2018 SCS here.

Couchweb: Strategic Analysis

The strategic analysis of Couchweb will help you identify where the company strengths and weaknesses lie and where they are heading.

You can find the full set of videos on the May 2018 SCS here.

Couchweb: Top 10 Issues

Now you’ve had time to look through the pre-seen analysis and strategic analysis, you should have an idea of the Top 10 Issues with couchweb? If you are still struggling for focus then the Astranti tutors view of the Top 10 Issues will help you on your way to passing the CIMA SCS first time.

 

You can find the full set of videos on the May 2018 SCS here.

Astranti SCS Course with Pass Guarantee

The SCS complete course boasts a huge amount of materials, advice, videos, mock exams etc etc. I’ve used it to good effect when passing the MCS exam earlier this year so would definteltly recommend it.

What’s more, they so confident you will pass the SCS exam they offer a pass guarantee!

You can find full details on the SCS course with pass guarantee here.

SCS Course Contents:

  • SCS study text (part 1 and 2)
  • Pre-seen analysis (video and text)
  • Strategic analysis (video and text)
  • Top 10 issues (video and text)
  • Industry analysis (video and text)
  • 2 x online master classes – each class is a full day revision (recorded and live)
  • 3 x online mock exams – answered with detailed tutor feedback
  • Ethics pack
  • Personal advice and guidance

 

CIMA SCS: AutoAuto Financial Analysis

The below article on the CIMA August 2017 SCS exam AutoAuto has been kindly provided by the good people at Viva Tuition.

CIMA SCS August 2017

The August 2017 Strategic Case Study deals with AutoAuto, an electronics and design company that sells to large car manufacturers. In this article we’re going to look at the financial statements presented in CIMA’s pre-seen for both AutoAuto and one of its main rivals, Primnav.

Income Statement Analysis – AutoAuto

AutoAuto’s Consolidated Statement of Profit or Loss signals trouble in the form of falling revenues and an even bigger decline in net profits in 2017.

Revenues declined 7% in 2017 while net profit fell by 19%.

We can really only speculate as to why this might be, but there is reason to suspect that AutoAuto lost one or more of its major car manufacturer customers in the past year.

Numerous references are made throughout the pre-seen as to the size of AutoAuto’s customers and also to the company’s reliance on relatively few of these. It’s also plausible that one or more of these large car manufacturers put pressure on AutoAuto to lower its prices and this has negatively affected their revenues and profits in 2017.

Whereas some years ago the four products that AutoAuto currently sells would have been considered cutting-edge and they could have charged a premium price for each, these products have all started to become commonplace in the industry, affecting AutoAuto’s ability to charge high prices for them.

This is another possibility for the poor performance in 2017.

AutoAuto – Research & Developement down

Looking elsewhere in the income statement, it’s concerning that the company’s research and development expense has declined by 7% in 2017. A company like AutoAuto relies on its intellectual property which forms the basis for future product developments and assures their continued growth.

The company’s researchers are being asked to do more with less now.

Income Statement Analysis – Primnav

Primnav’s income statement makes for far happier reading.

Revenues rose by almost 9% in 2017 while their net profit rose by almost 7%. The fact that Primnav’s revenues are over twice as high as AutoAuto’s may very well be a result of the fact that they serve the aftermarket (i.e. end consumers and garages) whereas AutoAuto does not.

Primnav has also taken care to ramp up its R&D expenditure over the year – the spent 22% more on R&D in 2017 than in 2016 which means they are preparing for the future by innovating and generating fresh ideas.

Statement of Financial Position – AutoAuto

The Consolidated Statement of Financial Position for AutoAuto again shows signs for concern. Total assets rose by just 0.2% in 2017 with indications that the company may be divesting physical assets as property, plant and equipment have fallen by 6% over the last year.

AutoAuto needs to take care that it does not fall into a vicious cycle whereby a lack of investment leads to weak or negative revenue and profit growth which in turn leads to less being available to make the necessary investments to position the company well for the future.

The one bright spot is that AutoAuto has paid down long-term debt over the last year with gearing (long-term debt / [long-term debt + equity]) falling from a very high 64% in 2016 to a more sustainable 50% in 2017.

Statement of Financial Position – Primnav

Primnav’s Consolidated Statement of Financial Position indicates that they are investing much more aggressively, with total assets rising 9.8% in 2017.

A good chunk of that investment has gone into intangible assets, meaning that Primnav is acquiring intellectual property in the form of patents, software etc all of which are playing an increasingly important role in a car industry in which software competence and the electrical components that go into cars are key differentiators.

Primnav issued shares in 2017 and it’s noteworthy that they pay out a very generous 85% of net profits in the form of dividends to their shareholders. This may make them an attractive stock to own as investors are guaranteed a yearly payout which may make attracting equity funding easier.

Financial Analysis Summary

In summary, there are reasons to be concerned for AutoAuto.

They may need to consider moving into aftermarket sales to generate another revenue stream. The pre-seen indicates that the company is positioning itself for big developments in the area of self-driving vehicles and it has already invested significantly in this area. However, the return on those investments are far from guaranteed and may be a long way off. It seems AutoAuto is noted for the quality of its products but those products are becoming common features of today’s vehicles. The company needs to innovate to survive and I’m concerned that their lack of investment in R&D expenditure and intangible assets over the last year may hurt them in the long-term.

This article was a snippet of what’s available from VIVA Tuition’s SCS AutoAuto materials for the upcoming August exam.

You can also visit their YouTube channel for more information.

CIMA SCS May 2017: Fizz

CIMA SCS Fizz Exam Tips

The final round of pre seen materials were released for the May 2017 sitting of the CIMA case study exams. It revolves around a company called “Fizz” and your role in the exam is that of Senior Manager.

You can find the official pre-seen materials from CIMA here.

Earlier this month I posted some advice for students who are taking case studies in May and you can find that here.

It’s also worth checking out the CIMA connect SCS homepage here where you will find resources, tips and advice from students in the same boat as you!

Fizz: Who are they?

Here is a quick overview and few highlights taken from the pre-seen materials for the Fizz case study

  • The company was founded in 1890 by the Clann family
  • The original products were mild tonics aimed to settle stomachs.
  • Fizz was listed on the Northalnd stock exchange in 1962 with the Clann family still holding 18% of the company.
  • “Froot” is the companies most popular drink, it’s a carbonated soft drink and has a growing global market.
  • Fizz also sells spring water (still and sparkling) – the water is collected from a spring close to the Fizz factory in Northland.
  • Their main competitor is a company called Quench who also has a franchise right to sell a global brand cola drink.

Fizz: Pre-seen video analysis

You can find the full set of videos on the May 2017 SCS here.

Fizz: Strategic Analysis

 

You can find the full set of videos on the May 2017 SCS here.

Fizz: Top 10 Issues

You can find the full set of videos on the May 2017 SCS here.

SCS: Full Astranti Course

You can find full details on the SCS course with pass guarantee here.

CIMA SCS February 2017: Evestar Reality

Feb 2017 SCS exam tips

The final set of pre-seen materials for the February 2017 sitting were released by CIMA this week as the SCS students get their hands on the Evestar case study scenario.

It perhaps the closet thing to a Christmas present you will receive from CIMA! But nevertheless, those students who sitting case studies in February should start work on the pre-seen materials straight away to make the most of the time available.

You can find the official pre-seen materials from CIMA here.

Earlier this month I posted some advice for students who are taking case studies in February and you can find that here.

As always, the CIMA connect website is packed full of resources and student discussion on the upcoming SCS exam.

Evestar Reality: Who are they?

Here is a quick overview and few highlights taken from the pre-seen materials for the Evestar case study.

  • Evestar are the largest producer of reality television in Teeland.
  • Revenue is measured with programme sales
  • Evestar does not produce low cost TV but focuses on prime time slots.
  • The introduction of digital TV has seen a host of new channels change the industry since the lat 1990’s.
  • Evestar was founded in 2006 by a major figure in the music industry.
  • Evestar develops and produces programmes and sells them to broadcasters.

Evestar Reality: Pre-seen video analysis

The tutors at Astranti have put together their pre-seen analysis of the SCS exam and you can watch a preview of the video below. It highlights all of the key information and how to approach your initial analysis of the pre-seen materials.

You can find the full set of videos on the February 2017 SCS here.

Evestar Reality: Strategic Analysis

Once you’ve analysed the full package of pre-seen materials we now need to be more focused with our approach – starting with a strategic analysis of xxx. Identifying the strengths and weaknesses will help you with next stage of the pre-seen analysis – understanding what the key issues are with the company.

You can find the full set of videos on the February 2017 SCS here.

Evestar Reality: Top 10 Issues

Now you have a fuller picture of xxx case study you should have an idea of the likely issues and questions that could come up on exam day. If not, the top 10 issues video gives you some expert on advice on what to expect on exam day, why and how to approach the likely questions you will face.

You can find the full set of videos on the February 2017 SCS here.

SCS: Full Astranti Course

You can find full details on the SCS course with pass guarantee here.

CIMA SCS November 2016: ADF

 

The final round of pre-seen materials for the November 2016 CIMA case study exams were published yesterday and the SCS students will focus on a company called ADF (Anderson Dairy Farming).

You can find the official pre-seen materials from CIMA on the SCS November 2016 exam here.

This SCS exam signals the end of the CIMA journey for those students who face it next so the next six weeks represents the most important in your CIMA studies!

With this in mind, the pre-seen video analysis provided by Astranti is the perfect starting point for getting to grips with the materials published by CIMA yesterday.

Good Luck!

ADF: Pre-Seen Video Analysis

SCS students will be taking on the role of Senior Manager in the Anderson Dairy Farming Company (ADF). So the tasks and questions you will face will be of a strategic nature as opposed to the more operational and mid-managerial level.

But first, we must get to grips with the pre-seen materials for ADF.

I would recommend going through the materials yourself, make notes and highlight the key information – then watch the pre-seen analysis from Astranti and align your notes accordingly.

Below is a pretty big preview video (57 minutes) of the full pre-seen analysis.

You can find the full set of videos on the November SCS here.

ADF: Strategic Analysis

By now, you should know the pattern we are going to take!

The strategic analysis of ADF should be under-taken so you get a firm grip on the strengths and weaknesses of the company and their overall strategy.

What markets are they operating?

What customers are they targeting?

What gives them their competitive advantage?

What are their competitors doing? 

The ideal model to use is the SWOT analysis – Strengths, Weaknesses, Opportunities and Threats. Anyhow the Strategic Analysis video will give you a great platform for understanding the strategy behind ADF.

You can find the full set of videos (including Strategic Analysis) on the November SCS here.

ADF: Top 10 Issues

Once you have understood the strategic analysis and performed the pre-seen analysis, you should have an idea of the kind of questions that will come up on exam day.

However, this can be very subjective and given the amount of information you need to digest it’s an almost impossible task to identify all of the syllabus areas and likely issues that could come up on exam day.

This is where the Top 10 Issues video gives you a focus and advice from a CIMA tutor on what they believe will come up on exam day regarding the ADF case study. It’s a great way to focus your studies in the lead up to exam day.

You can find the full set of videos (including the Top 10 Issues) on the November SCS here.

Astranti SCS Pass Guarantee

Finally, the full SCS course for the ADF case study covers all of the resources you will need for exam day – ranging from the videos mentioned above to online revision classes with mock exams and tutor feedback and marking.

You can find full details on the SCS course with pass guarantee here.

SCS Course Contents:

  • SCS study text (part 1 and 2)
  • Pre-seen analysis (video and text)
  • Strategic analysis (video and text)
  • Top 10 issues (video and text)
  • Industry analysis (video and text)
  • 2 x online master classes – each class is a full day revision (recorded and live)
  • 3 x online mock exams – answered with detailed tutor feedback
  • Ethics pack
  • Personal advice and guidance

CIMA Case Study Advice: November 2016

The seemingly never-ending cycle of CIMA Case Study exams is beginning to rear it’s head again with the pre-seen materials for the operational level case study being released next week.

So for students who are sitting case study exams in November, here is a run down of the best resources and what you should be doing if you want to pass the CIMA case study first time.

Post Exam Kits – August 2016

Learning from previous exam sittings is a great way to boost your chances of passing the CIMA November case study sittings. CIMA have provided all students with the previous exam papers for the August case study exams with the suggested answers – for ALL FIVE variants as well as other

The home page for the post exam kits (links below) will direct you to the;

  • Pre-seen material
  • Case study exam paper
  • Suggested answers
  • Examiners report
  • Exam marking guidance

TIP: As of writing, the examiners report and exam marking guidance for the August sitting are not yet available but if you search for the May 2016 case study post exam kits you will find these documents for that sitting there.

The examiners report – a topic I have written about here – is another brilliant free document provided by CIMA that will give you tips and advice on how to pass CIMA case study exams first time.

OCS: August 2016 post-exam kit

MCS: August 2016 post-exam kit

SCS: August 2016 post-exam kit

Case Study Master Classes

For those students who are self studying for the case study exams, the master classes hosted by Astranti offer TWO full days of live classes with one of their CIMA tutors – and it’s a great way to supplement your existing study resources.

The first one is based around the keys to passing the case study exam, while the second master class is scheduled a week before the actual exam date and packs in a whole day revision on the case study scenario and the likely questions that could crop up.

The video below is an example of the master class that was held regarding the SparkSpace scenario with the August 2016 MCS exam.

The dates of the master classes for the November case study exams are listed below:

OCS Master Classes: 8 October 2016 and 5 November 2016

MCS Master Classes: 15 October 2016 and 12 November 2016

SCS Master Classes: 22 October 2016 and 19 November 2016

Case Study: Full Course Contents

If you’re looking for a more comprehensive set of case study materials then Astranti also offer a full course with a PASS Guarantee – I passed the OCS last year by using their case study materials and they are really developing a strong reputation with their resources.

  • Study Text 1 – focuses on what you need to pass the case study.
  • Study Text 2 – summaries the key areas from the whole syllabus.
  • Pre-Seen Analysis – tutors detailed analysis of the pre-seen material.
  • Strategic Analysis – uses models & key theories and how to apply them in the exam.
  • Top 10 Issues – identifies the top 10 issues that could come up on exam day.
  • Industry Analysis – gives you the current industry trends for your case study.
  • Masterclass 1 – live session with tutor on keys to pass the case study exam.
  • Masterclass 2 – live session with tutor on revision of case study scenario.
  • 3 Mock Exams – with detailed feedback based on the actual case study scenario.
  • Personal Advice and Guidance – via private forums and progress reviews.
  • Ethics Pack – often overlooked but this comprehensive guide covers Ethics and how to apply it to the CIMA case studies.

You can find full details of their courses for all levels below and dates when the pre-seen material is released for the November 2016 exams:

OCS Course – November 2016 – the pre-seen material for the OCS exam is released on the week commencing 19th September 2016.

MCS Course – November 2016 – the pre-seen material for the MCS exam is released on the week commencing 26th September 2016.

SCS Course – November 2016 – the pre-seen material for the SCS exam is released on the week commencing 3rd October 2016.

Acorn Financial Tutors

Another learning provider who offer CIMA case study materials are Acorn and readers of this website can claim an extra 10% discount off ALL CIMA materials.

Their latest list of CIMA case study materials can be found here.

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Currently (offer ends 30 September 2016), the hard copy of their full Integrated Case Study kit has been reduced to £240 from £360 – so you can order it for £216 by emailing your request to thecimastudent[at]gmail[dot]com

Study Support: Whats App Groups

Whats App groups for student discussion around the upcoming case study exams also seems to be an idea that is growing with every passing exam sitting.

I was part of one for the OCS last year and, if you don’t need getting lots of updates and messages on Whats App (you can always turn notifications off), I found it very interesting to hear other students points of views about the pre-seen material and how they were handling their revision. Not everything was helpful but from the point of view of a student who is self studying it’s very much worth joining.

The sign up for the Whats App groups can be found on the CIMA connect site – here is the link for the OCS November 2016 group. I couldn’t find anything for the MCS or SCS on the CIMA connect site but I am sure they will be created shortly – or you could even start one yourself.

Good Luck and Happy Studying!