Richter: Information Technology at Hungary’s Largest Pharma

                      Richter: Information Technology at Hungary’s Largest Pharma

                            Student ID:20523773       Name: Cheng Shu(Susan)

1. Characterize Richter’s business environment

Richter was Hungary’s largest pharmaceutical company and was considered to be one of the region’s most prominent product of generic drugs and generic APIs.

The majority of its revenues were derived from generic drugs ,and competition in generic and API industry is fierce. The total supply may exceed actual demands by 300 percent and the wholesalers decides whose product to buy. Successful factors of generic companies were seen to be low-cost production capabilities.

Richter is a “regional multinational” with geographic strength in the CEE and CIS countries , where is a market opened up at the beginning of 1990s and since then were facing competition from international companies.

Pharmaceutical were one of the largest industries in the world, with approximately 10 major global integrated players that made up roughly one third of the global market.

2. What do we know about Richter in terms of: i. Business and IT strategy; ii. Organizational structure, including the IT units; iii. IT portfolio and systems.

• Business  strategy

To be the most prominent “regional multinational” genetic drug producers and distributor giant, with the geographic strength in the CEE and CIS counties and with ambitious international expansion plan.

• IT strategy

           To build the digitalized platforms to support its business strategy according to the roadmaps, privatization, international production and distribution expansion ,approval of the generic, quality insurance and  innovations.

• Organization Structure of Overall and IT units

The company ‘s top management team comprised seven senior executives who are took care each function and each of them was responsible for its corresponding functional area at their foreign affiliates.  

There was no IT function and the head of IT department , the CIO, Szucs, was reported to the CFO. All the affiliate IT departments reported directly into the affiliate management with a dotted line to the central Hungrian office. As for the IT, it is a decentralized structure.

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• IT portfolio and systems

1. Technology

Infrastructures- VPN,130 servers with 110 located in Budapest,Windows operating systems

1. IT in-house staff- around 50 direct employee, 45 indirect employee; and  80 external consultants ,illustrated by Exhibit 9
2. IT spending -1.5 percent of sales in 2006

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1. Systems (Illustrated by Exhibit 6)

Documentum- Mongering the paper requirements in seeking regulatory approval on generic drugs.

ERP-SAP, to manage all the business process, from production to finance.