Porter’s Five Forces Analysis: Quo Vadis Immunotherapy Industry

Investors and market analysts often seek different perspectives for market analyses of companies to gain a better picture of companies’ positions and strengths within their industries. One tool for fundamental analysis that goes beyond just examining financial metrics such as the price-to-book ratio is Michael Porter’s Five Forces Model. Therefore, the moment seems opportune to ask whether the five competitive forces remain adequate for characterizing the nascent cell therapy industry and whether the framework provides sufficient decision-making insight to stakeholders, be they insurers, providers, patients, employers, or policy makers. This article discusses the five competitive forces, (i) threat of new entrants, (ii) threat of substitute products or services, (iii) bargaining power of suppliers, (iv) bargaining power of buyers, and (v) rivalry among existing competitors for the nascent cell therapy industry. Factors influencing each of the forces provide insight into tehose areas most likely to impact industry profitability and therefore also stakeholder decision-making.