Company Background

Pascual Laboratories, Inc. began as a simple family-owned business with Christian values at the center of its operations. Dr. Abraham F. Pascual Ph.D., the youngest son of the founders of PascualLab, Isosceles and Leonora Pascual, decided to put doing the right things as the company motto in his Pascual Laboratories, Inc. with its six Business Units and Subsidiaries in 1993. The companys mission-vision and values statement serves as the guide for the organizations in the way they conduct business. In the case of PLI, the way the company runs is depicted in its mission and values statement. The mission statement of PLI is very simple yet very powerful - the direction which the company wants to go, which is global; the desire to provide quality products for the consumers; and the passion to ensure a fair return to its stakeholders. On the other hand, the values of the organization are excellence, moral uprightness, innovativeness, teamwork and social responsibility. PascualLab is a Filipino-owned company that has been in the business for 65 years. They have maintained their thrust in the pharmaceutical industry in the country despite the strong competition. The company is able to compete with larger multinational frims such as GlaxoSmithKline Beecham, Mead Johnson Philippines, Wyeth Philippines and Pfyzer. Some of their subsidiaries include ADP Pharma Corporation, Pascual Consumer Healthcare Corporation, Pascual Pharma Corporation and Pharex Health Corporation and this business structure is executed to address the growing needs of the market. PascualLab aspires to provide high quality yet affordable products and all products are manufactured in IS0 and GMP-certified factories. PascualLab is known for its expertise in introducing new products to the market which includes generic drugs and natural/ herbal medicines. Today, the firm has more than 300 medicines in different forms and they continue to enhance their existing products and create new ones to address the needs of the Filipinos.

Statement of the problem - Carlo

Objectives - Carlo About the Product

Ascof Lagundi is a cough syrup trusted by moms because it uses natural ingredients. Lagundi is one of the 10 herbal medicines approved by the Department of Health and doctors recommend it to treat cough and asthma syptoms. Ascof is being manufactured by Pascual Laboratories, one of the leading pharmaceutical companies in the country. The product is available is different flavors namely ponkan, strawberry, menthol, and menthol sugar-free flavors as well as in tablet and capsule forms.

ASCOF Lagundi Syrup1 Packaging: 20mL / 60mL

Indications ASCOF Lagundi tablet and syrup is the only extensively researched and clinically proven natural medicine for cough and asthma in the Philippines.

Taken from http://www.PascualLab.com/product.php

ASCOF Lagundi is Natural. Made from 100% Lagundi leaves which were nurtured organically in a quality-certified farm untainted by synthetic chemical fertilizers and pesticides. ASCOF Lagundi is Safe. No side effects were reported in the clinical trials for the syrup. No known contraindications. No risk of overdose. ASCOF Lagundi is clinically-proven effective. ASCOF Lagundi relieves cough through a "three way alis-ubo action": Bronchodilating effect (Lumuluwag) Mucolytic (Natutunaw) Anti-histaminic / Cough Relief (Gumiginhawa) And since it is natural, you won't experience the harmful side effects of common chemical cough and asthma drugs. ASCOF Lagundi Clinically Proven Safe and Effective...Natural!

Other Variants:
ASCOF Lagundi Forte Syrup with Menthol 600 Packaging: 60mL / 120mL

ASCOF Lagundi 300mg Tablet Packaging: 100s

ASCOF Lagundi Forte 600mg Tablet Packaging: 12s / 20s / 60s / 120s

Industry
What is herbal medicine?

An herb is a plant or plant part used for its scent, flavor or therapeutic properties.2 Herbs used to treat illnesses and diseases are also known as herbal medicine, botanicals or phytotherapy. Some herbal medicines are used as dietary supplements to combat viruses and boost the immune system. These medicines are sold in many forms such as capsules, powders, teas, tablets or juices. However, one must be cautious in choosing herbal medicines because not all are effective and some may be unsafe if combined they are with other drugs. Just like any type of drugs, it is best to consult a doctor first before taking herbal medicines especially for pregnant or nursing women.

Taken from http://www.nlm.nih.gov/medlineplus/herbalmedicine.html

As previously mentioned in this paper, DOH endorsed 10 medicinal plants that can be used as herbal medicines. These herbal medicines underwent clinical tests to ensure that they are safe for human consumption. These are Akapulco (Cassia Alata), Ampalaya (Mamordica charantia), Bawang (Allium satiyum), Bayabas (Psidium guajava), Lagundi (Vitex negundo), NIyog-niyogan (Quisqualis indica L.), Sambong (Blumea balsamifera), Tsaang GUbat (Ehretia microphylla Lam), Ulasimang Bato (Pansit-pansitan) and Yerba Buena (Clinopodium douglasii). Lagundi or vitex negundo is a native plant that grows in the Philippines that has a single stem with five pointed leaves. It is used as treatment for cough, colds and fever as well as asthma & pharyngitis, rheumatism, dyspepsia, boils, and diarrhea and easing symptoms of chicken pox.

Lagundi Herbal Medicine Preparation3

Wash fresh or dried Lagundi leaves Chop then add in 4 cups of water for every 1 cup of lagundi parts Let it boil for 10 to 15 minutes Let it steep then strain the various parts. Lagundi concoction can be stored in suitable glass container for later consumption.

Taken from http://www.medicalhealthguide.com/articles/lagundi.htm

Market/ Consumers Analysis of Case Facts

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SWOT Analysis
Strengths - Profitable company - Competent leader - Defined company values - Driven workforce - Strict compliance on government regulations - Product innovation - Recognition and accreditation in manufacturing and operations Opportunities - Market for alternative medicine - Public listing Weaknesses - Succession

Threats - Strong competition - Corruption in government

Strengths
Pascual laboratories, Inc. (PascualLab) is an outstanding business entity profitable, a market leader, administratively and morally sound, and employee-centered. PascualLab is a profitable corporation posting net income of Php 166 million and Php 190 million for the year 2004 and 2005 respectively an accomplishment spearheaded by its competent leader, Dr. Abraham F. Pascual. Presently the Chairman of the Board, Dr. Pascual is well-schooled having attended Ateneo de Manila University in the Philippines, Fordham University in New York City, and University of California in San Francisco, USA. PascualLab is a recognized market leader. With significant advancements in product innovation and manufacturing process, the corporation leads the industry in alternative medicine, wound remedy products, anti-infectives and antituberculosis medicines.

Weakness Opportunities
With its present stature, PascualLab is in position to capitalize on some opportunities. It can strengthen its industry-leading alternative medicine segment. It can enlist in the stock market. It can increase CSR awareness in the Philippines. PascualLabs alternative medicine segment leads the industry in terms of innovation. Their

products are competing against the established medicines of international pharmaceutical companies. While the other companies are continuously manufacturing medicine conventionally, PascualLab should improve on their alternative methods they use less resource, thus resulting to cheaper medicine for the public. With its track record in growth and profitability, PascualLab is ready to enlist in the stock market. Its performance can easily attract investors making it ripe for an initial public offering.

Threats
Businesses in a Third World Country will face challenges. PascualLab should prepare for strict competition and concerns on corruption. The pharmaceutical industry is a competitive industry. Competitors include numerous local

players and more importantly, recognized international companies. PascualLab, with its current market position and guided by their values, should anticipate and adjust to the difficulties of competing in a crowded market of quality players. Corruption continues to be prevalent in the country. The case suggests that PascualLab has already solved the problem of corruption. They adhered to their values and used their strengths. Nonetheless, corruption will continuously present itself. PascualLab were able to solve it before, the management just have to use the formula again.

SPELT (Social, Political, Economic, Legal, Technological)

Social Issues
Average household expenditure for medicines and drugs is about Php1,292 per annum in year 2000.

Political Issues
As part of World Health Organizations Millenium Development Goals (MDGs) and Medium Term Philippine Development Plan, the FOURmula one for health was created. It aims to provide better health results, more receptive health system and more reasonable health system in the country.

Economic
Philippine pharmaceutical industry is ranked as the 11th most attractive market in AsiaPacific region and third largest in ASEAN region following Indonesia and Thailand. Due to

this, 14 out of 20 international pharmaceutical companies built their manufacturing plants in the country. Philippine government allocates 3.4% of its GDP on health and medicines and it is projected to increase to 3.6% in 2013. In 2008, Philippine phramaceutical industry reached US$ 2.51 billion and it is forecasted to reach US$ 3.91 billion in 2013. Breakdown of the industry : The industry is composed of over-the-counter drugs, prescription drugs and nutritionals such as infants milk, nutritional food, diagnostic and other medical equipments.

Legal
Intellectual Property Code of the Philippines (R.A 8293) Special Law on counterfeit Drugs (R.A. 8203) Philippine Generics Act of 1988 (R.A. 6675) allows consumers to have more choices at greater cost savings

 Universally Accessible Cheaper and quality Medicines Act of 20084 Allows parallel importation of patented medicines from other countries were they are affordable. Imposes price ceiling (Maximum Drug Retail Price) on essential drugs upon the recommendation of the Department of Health Incentives granted to pharmaceutical industries are as follows: 4 to 8 years Income Tax Holiday (ITH) Special 5% tax rate on gross income after the lapse of ITH (applies only to Eco-Zones) Tax and duty exemption in imported capital equipment (applies only to Eco-Zones) Duty-free importation of capital equipment (for BOI-registered firms under E.O. 528); Exemption from 12% input VAT on allowable local purchase of goods and services (applies only to Eco-Zones) Additional deduction for labor expense.

Technology
There are approximately 240 products introduced to the market by both local and foreign companies from 2002 to 2007. Philippine council for Health Research and Development (PCHRD) supports and encourages research and development initiatives of pharmaceutical companies. Sources: http://www.PascualLab.com/product.php http://www.nlm.nih.gov/medlineplus/herbalmedicine.html http://www.medicalhealthguide.com/philippineherbalmedicine.htm http://www.tripleiconsulting.com/main/philippines-investment-resources/valuepropositions/philippines-pharmaceutical-industry

Taken from http://www.tripleiconsulting.com/main/philippines-investment-resources/valuepropositions/philippines-pharmaceutical-industry

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