Sustainable profitable growth and long-term value increase
With its business model STADA aims to generate sustainable profitable growth and to increase the value of the company in the long-term.
To reach these targets, in financial year 2016 the Executive Board agreed a revised corporate strategy. With an unchanged strategic orientation, numerous initiatives were introduced to improve the performance of the Group with which competitiveness and innovation is to be increased and added value is to be achieved in the long-term. As part of the implementation of the initiatives, untapped sales potential will be leveraged, marketing expenses will be optimized, sales efficiency will be enhanced and cost of sales will be reduced . For example, promising products are to be introduced into more countries in order to take advantage of previously untapped sales opportunities in the Branded Products segment. Within the Generics segment, STADA will benefit from the expiration of further patents and will also supplement the portfolio with selected biosimilars. Furthermore, the number of Group companies and product presentations is to be minimized, the number of suppliers reduced and production processes further optimized. A changed corporate structure with clear areas of responsibility and greater transparency as well as a re-positioned corporate culture with an increased focus on entrepreneurship, extensive knowledge sharing and an open dialog are to contribute towards reaching the objectives. In general, the revised strategy will also make a significant contribution towards reaching the objectives for 2019, presented in 2016 (see “Report on Expected Developments”).
Build on generics, expand branded product business and strive for additional growth opportunities
Generics segment remains part of the core business – expansion of the attractive-margin Branded Products area
In order to grow further, STADA is relying on both organic growth and value-adding acquisitions. Generics will remain part of STADA’s core business, and within it growth potentials particularly exist in the expansion in markets with relatively low penetration rates and in the supplementation of the existing portfolio with selected biosimilars. In the Generics markets, in which the Group is already active with subsidiaries, STADA aims to maintain or take leading positions. With the help of continuous growth in the Generics segment, the Group intends to generate financial means, to further expand the often more attractive-margin Branded Products area and gradually increase the share of this segment in Group sales as a result. Within Branded Products, STADA is aiming for both further expansion and the increasing internationalization of successful brands. Innovative marketing concepts are to be used in this context. Alongside the strengthening of the Generics and Branded Products segments, STADA intends to take advantage of additional growth opportunities in niche and non-regulated markets through the introduction of innovative products.
As part of the strategic development, the organizational and sales structures were reviewed. German business activities, for example, are to be bundled and made more competitive to improve perception on the market and achieve sales and cost advantages. In this context, STADA GmbH and STADAvita as well as STADApharm and cell pharm are to be merged. At the beginning of the fourth quarter of 2016, the management of STADA GmbH and STADAvita as well as STADApharm and cell pharm started negotations with the Works Council about the details of a merger as well as the balancing of interests and a social plan.