Genentech, Inc., is a California-based biotech pioneer acquired by Swiss pharmaceutical giant Roche Holding AG in 2009. Roche paid$46.8 billion in cash for the 44 percent of Genentech it did not already own, implying a market value of over $100 billion for the entire company. For a look at Genentech€™s sustainable growth challenges leading up to the acquisition consider the following selected financial data.

a. Calculate Genentech€™s annual sustainable growth rate for the years2003€“2007.
b.Did Genentech face a growth management challenge during this period? Please explain briefly.
c. How did Genentech cope with this challenge?
d. Calculate Genentech€™s sustainable growth rate in 2007 assuming an asset turnover of 0.72 times. Calculate the sustainable growth rate in2007 assuming a financial leverage of 2.20 times. Calculate the sustainable growth rate in 2007 assuming both of these changes occur.

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2H3 2004 2005 19.30 100.00 0.55 1.79 43.50 20MMG 2MT Profit margin (% Retention ratio (%; Asset turnover (X) Financial leverage (X) Growth rate in sales (%) 17.00 100.00 0.38 1.64 26.10 17.00 100.00 0.49 1.44 40.00 22.80 23.60 100.00 100.00 0.62 2.00 26.30 0.63 1.99 40.00