Chapter -4 PESTEL AnalysisChapter - 4 4. PESTEL To analyze the macro environment of any company PESTEL analysis is an important tool. It demonstrates the external environment which impacts the operation of the company. ‘The elements for PESTEL analysis are- + Political factor analysis, + Economical condition analysis + Social condition analysis, + Technological condition analysis + Ecological/Environmental condition analysis + Legal condition analysi PESTEL Analysis of Aristopharma 4aaP itical Analysis Aristopharma is one of the major players in pharmaceutical industry in Bangladesh. But the political turmoil here heavily affects the business especially in recent years. As most of the raw materials are tmported from abrcad through the Chittagong port, so it !s very difficult to get them on time due to these strikes and blockades. Also they could not deliver the finished products to the local market as well as to the market outside the country for the same reason, [N.p. 2015. Print.] On the other hand according to a circular byNBR on sth June 2014, government reduced the import tax of some raw materials from 15% and 5% to 0%. This is also a favorable decision for all the pharmaceutical companies including Aristopharma. In case of export, pharmaceuticals products are given highest priority by Bangladesh government and they get income tax rebate as well in order to diversify their export. Government also providing them with reduced restrictions in exporting the pharmaceuticals products. Aristopharma can export their sample products worth of US$60,000if there is export letter of credit (LC). 2‘There are some pharmaceutical companies who has some affiliation with political parties also hampering the growth of Aristopharma some extend. 4.1.2 Economic Analysis The economy of Bangladesh is growing very fast and so is the case for pharmaceutical industry which is a positive aspect for the company like Aristopharma. The interest rate of bank is around 15%, which is very high compared to the countries outside, which is a big problem for Aristopharma for their growth. The inflation rate of Bangladesh is not very high (6.27% in March 2015), which has a positive effect in pricing strategy of Aristopharma. In recent year the exchange rate of US dollar is fluctuating, which is creating some problems for Aristopharma in case of cost and price. 4.1.3 Social Analysis, As Bangladesh is a developing country and most of the people live below the poverty level they are not that health conscions. In spite of taking medicine they rather prefer other traditional treatment, which is an obstruction for Aristopharma in expanding in local market. As the population is growing and people are being more educated now a day, this problem is expected to be overcome in near future, 4.1.4 Technological Analysis According to Aristopharma their R&D is the synonym of creativity. their R&D division yields around 30-40 products each year. Aristopharma is the first company in Bangladesh to manufacture only HFA based inhalers. 23Aristopharma’s plant is equipped with highly sophisticated and advanced facilities. They are using hi-tech equipments and imaterials in production process. Aristopharma has planned to build one of the finest pharmaceuticals plant of the present lime as per the cGMP guideline of US FDA & UKMHRA. 4.1.5 Ecological/Environmental Analysis Aristopharma is producing environment friendly HFA inhaler in Bangladesh. They also has environment friendly working plants. As per the government regulation they are using ETP plant for environment friendly pharmaceutical-waste management. 4.1.6 Legal Analysis World Bank Group (2015) reports Bangladesh as ranked 173 out of 19 countries on ease of doing business regarding legal issues, which also impacts Aristopharma’s business activities. ‘There are two drug regulatory organization, The Director General of Drug Administration (DGDA) and The Pharmacy Council of Bangladesh (PCB), but their supervisory and monitoring role also affects Aristopharma’s production, distribution and marketing. 14Political Economic * Political turmoil in Bangladesh is heavily affecting the business, especially in recent years. "Trade restriction is lenient for pharmaceutical companies * No tax payable for importing raw materials. * Tax rebate for exporting sample products, has * Governments tule of using ETP increased the cost Social "As the literacy rate is increasing so does the health consciousness. = The population growth rate of Bangladesh is decreasing (1.2 in 2014). * Most of the people (65%) is aged between 15-64, * People are getting more career oriented now aday = As most of the people still lives below the poverty level, the health consciousness is still not that his = Producing eco friendly inhalers as the first company in Bangladesh. = Using eco friendly pharmaceutical waste ‘management process. "Economic growth of Bangladesh is quiet satisfactory (Expected to be 6.1 in 2015), but recent political problems are disturbing the growth. "The interest rate of the bank is very high (15%), "The exchange rate (mainly USS) is fluctuating in recent years. * Inflation rate of Bangladesh is not that high (6.27 in March 2015). * Aristopharma’s R&D section is doing pretty ‘g00d with yielding 30-40 products each year. = Each of the process of production is highly automated and Aristopharma is planning to build another highly automated plant in near future. + Government is providing logistic supports to import more equipment needed. = Use of technology is increasing day by day. = Though consumer law exists in Bangladesh but it is not that effective. + Employment law Bangladesh but again not that effective is also available in "Discrimination law has recently been the talked of topic of the country in recent time. 15