INTERNAL/EXTERNAL FACTOR ANALYSIS AT GENENTECH
The biotechnology industry is, by its very nature, highly dependent on technology for its survival. Research and development is a critical success factor in this industry, as is seeking global markets to recoup large R&D investments. This research considers internal and external factors that affect one of the leaders in the biotechnology industry, Genentech, a global company based in San Francisco.
The biotechnology industry is characterized by seeming contradiction with regard to the rate of change. Change in the technology that forms the basis of the industry can indeed be rapid--advances in DNA research over the past ten years has made possible the very existence of Genentech. However, the pace of getting new therapies tested for efficacy and brought to market under the watchful eye of the Food and Drug Administration (FDA) is anything but rapid, with product introductions requiring many years to achieve (Markey, 2003a).
Genentech is itself a product of the global economy. The company is publicly traded and is based in San Francisco, but a Swiss company--Roche Holdings--owns 60 percent of the company's common stock. In addition, Genentech has sizable markets for its products throughout the world, with the result that the company must meet not only FDA regulations and requirements, but also those of other regulatory agencies, including the European Union. Genentech has also entered into agreements with companies marketing to other countries to market Genentech's products, as well (DiLorenzo, 2004).
Technology forms the basis for Genentech's business. The company used recombinant DNA technology in its earliest products at a time when few other companies were able to produce satisfactory results with that technology. Today, the company invests a significant portion of its revenues in research and development--24 percent i
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