Acquisition of Competitors in the Same Industry

Steps:

• Identify the core business: Both companies manufacture medicines for rare diseases, operating at the same production stage.
• Compare integration types: Horizontal involves merging firms in the same industry to increase market share.
• Rule out vertical options: No mention of supply chain differences like suppliers or distributors.
• Confirm goal: Becoming the world's leading supplier aligns with consolidating competitors.

Why D is correct:

• Horizontal integration is defined as the merger of two or more companies at the same level in the value chain within the same industry, here both specializing in rare disease medicines.

Why the others are wrong:

• A: Backwards vertical integration acquires upstream suppliers, not competitors in manufacturing.
• B: Conglomerate integration combines unrelated businesses, but both firms are in the same rare disease sector.
• C: Forwards vertical integration acquires downstream distributors, not parallel manufacturers.

Final answer: D