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An important and sometimes overlooked factor that distinguishes one company from another in the pharmaceutical industry is strategic planning. Porter's model looks at the competitive arena in which businesses operate and describes five basic competitive forces that directly impact on how successfully a business unit operates. By understanding and knowing what these competitive forces are and how they impact on the business, managers are better equipped to prepare their plans. They are also more able …

…impact, but not a lot There is not much rivalry because the pharmaceutical market is fragmented, made up of many players. New entrants are not common, largely because of the high barriers to entry, especially R&D and manufacturing and marketing costs. So overall, the competitive force that exerts the most pressure in the pharmaceutical industry is the buyer and there should be a focus on the competitive strategies associated with this group.