Businessmodel of Mylan

Customer Segments

Mylan offers a portfolio of more than 1,400 marketed products to a broad range of customers. The Company principally serves various segments of the healthcare and medical sector, including:

• Distributors, including specialist medical distributors and wholesalers;
• Pharmacies, including retail pharmacy chains, mail order pharmacies, independent pharmacies, and pharmacy benefit management companies;
• Medical Facilities and Healthcare Organisations, including long-term care facilities, managed care organisations, hospitals, nursing homes, pharmacy benefit management companies, group purchasing organisations, and government entities; and
• Medical Professionals, including physicians, pharmacists, pharmacy benefit managers, and general healthcare practitioners. Mylan’s customers include major US medical distributors AmeriSource Bergen Corporation, McKesson Corporation, and Cardinal Health Inc. The Company also serves CVS Caremark, Walgreens, and Alco Health.

Mylan serves a global customer base, serving customers across 165 countries and territories worldwide, spanning the Americas, Europe, Asia Pacific, the Middle East, and Africa. The Company’s largest market is North America, which accounts for the largest single portion of its revenue.

Value Propositions

Mylan provides value to its customers in the following ways:

• Its reputation and industry standing, with the Company establishes as a reliable producer of generic and branded pharmaceuticals, with a positive track record spanning a number of years;
• The breadth and quality of its products, with the Company offering a wide range of high-quality, regulated products that are designed to treat a broad range of conditions and ailments;
• Its international reach, with the Company operating a network of facilities across the world, serving a global client bases across the Americas, Europe, Asia Pacific, the Middle East, and Africa;
• Its industry expertise and experience, with the Company employing highly-trained, specialist personnel across its multiple operating segments, as well as a team of experienced industry executives; and
• Its intellectual properties, with the Company owning, controlling, and licensing a range of patents that enable it to manufacture unique products that cannot be found elsewhere. ### Channels

Mylan operates a website at www.mylan.com, through which it provides information on its various products, services, and operating locations. The Company does not operate an online sales channel, nor does it provide an online customer portal that allows customers to manage their transactions.

Mylan makes its sales primarily through an in-house sales force, which is organised by operating segment, division, and geographic region. This includes dedicated sales subsidiaries across a number of its jurisdictions, as well as a specialist specialty pharmaceuticals team. These sales personnel operate out of the Company international network of offices, which spans the Americas, Asia Pacific, and Europe, Middle East and Africa. The Company also makes sales in certain markets through field-based sales representatives and National Accounts teams, as well as through third-party distributors and tenders.

Mylan operates its own in-house manufacturing and distribution infrastructure. This includes seven production, distribution and warehousing facilities in the US including Puerto Rico, as well as production, distribution and warehousing facilities in nine countries outside the US, including key facilities in India, Australia, Japan, Ireland, Brazil, Hungary and France.

Customer Relationships

Despite its online presence, Mylan does not offer any products or services to customers on a self-service basis. Instead, the Company makes sales through its in-house sales force spread across its operating divisions and subsidiaries, which works closely with the Company’s clients in order accurately and efficiently address their individual needs. The Company makes sales under distribution contracts, which often span multiple years.

Mylan provides ongoing support to its clients, particularly its larger customers which are provided their own customer relationship teams to work on their account full-time. Customers are also able contact members of the Company’s sales and support personnel, and receive personalised assistance. The Company’s support personnel can be reached by contacting the relevant office by phone, post, or fax.

Additionally, Mylan provides a range of online resources to its customers, including physicians, pharmacists, and patients. This includes technical information on the Company’s products, educational materials, pharmacist guides, and health information. Customers are also able to follow the Company’s operations and interact with it directly through its social media accounts, including with Facebook, Twitter, and YouTube.

Key Activities

Mylan is a global pharmaceutical company. The Company develops, licenses, manufactures, markets and distributes generic and branded generic products for resale by its customers. It also develops and sells specialty pharmaceuticals, and active pharmaceutical ingredients.

The Company organises its activities into two reportable business segments: Generics, which develops, manufactures, sells and distributes generic or branded generic pharmaceutical products in tablet, capsule, injectable, transdermal patch, gel, cream or ointment form; and Specialty, develops and sells respiratory and allergy therapies.

The Company’s specialty products include EpiPen Auto-Injector, an epinephrine auto-injector used in the treatment of severe allergic reactions, and the Perforomist Inhalation Solution designed to treat bronchoconstriction in chronic obstructive pulmonary disorder patients. Through its divisions and subsidiaries, Mylan serves a global customer base spanning the Americas, Asia Pacific, and Europe, Middle East, and Africa.

Key Partners

Mylan works closely with a range of companies and organisations in order to efficiently produce and distribute it products. These partners can categorised broadly as:

• Supplier and Vendor Partners, including suppliers of raw materials, tools, and equipment that are used in the manufacture of the Company’s pharmaceutical products, as well as suppliers of technologies and services that are utilised more broadly across the enterprise;
• Channel and Distribution Partners, principally comprising various third-party distributors that support and extend the Company’s in-house sales and marketing capabilities, in particular in certain jurisdictions where it is not well served;
• Research and Development Partners, including various pharmaceutical manufacturers and research companies with which the Company jointly develops and manufactures pharmaceutical products;
• Joint Venture Partners, including various pharmaceutical producers with which the Company jointly manufactures and markets products through mutually owned entities; and
• Strategic and Alliance Partners, including companies and organisations across multiple sectors with which the Company shares resources and collaborates on projects. Mylan has a number of partnerships in place. This includes a partnership with Biocom to develop and market a biosimilar product, and a supply and commercialisation deal with Mabion in Poland.

Key Resources

Mylan’s key resources are it intellectual properties and brands, its raw materials and supply chain, its manufacturing and development facilities, its sales and distribution infrastructure, its IT and communications infrastructure, its licenses and regulatory approvals, its partnerships, and its personnel.

Mylan owns and licenses a number of patents in the US and other countries covering certain products and has developed brand names and trademarks for other products. Searches of records published by the US Patent and Trademark Office identified numerous patent applications in Mylan’s name, including applications entitled ‘Transdermal dosage form for low-melting point active agent’, ‘Transdermal patch incorporating active agent migration barrier layer’ and ‘Medicament information system and method’.

Mylan also owns and or leases a number of physical properties that are key to its operations. Notably its international network of manufacturing and research and development facilities.

Cost Structure

Mylan incurs costs in relation to the development and manufacture of its products, the procurement of supplies and materials, the operation of its sales and distribution channels, the maintenance of the IT and communications infrastructure, the implementation of advertising and marketing campaigns, the management of its partnerships, and the retention of its personnel.

In 2015 Mylan recorded total cost of sales in the amount of $5.21 billion. The Company’s selling, general, and administrative costs totalling $2.18 billion, and research and development costs totalling $671.90 million.

Revenue Streams

Mylan generates revenue through the development and sale of generic and branded generic pharmaceuticals, specialty pharmaceuticals, and active pharmaceutical ingredients. The Company sells more than 1,400 products, to customers across around 165 countries. The Company also derives a small amount of revenue through the provision of certain related services.

In 2015 Mylan generated annual revenue of $9.43 billion, up on the 7.72 billion recorded by the Company in 2014. The majority of this revenue was generated by the Company’s Generics segment, which alone recorded net sales for the year of $8.16 billion.