NellFinancial Consultant StephenRisk Consultant AmyMarketing Consultant FevziGeneral Consultant TubaMarketing Consultant Hye YoungChief Consultant HakanMarketing Consultant Berkeley Consultant Group

Introduction Marketing BA 160 Content Dimensions Decision Marketing Strategy Financial Analysis Conclusion

Company background Privately owned biopharmaceutical firm Potential products: Hemopure For Human usage Awaiting approval by FDA Oxyglobin For animal usage Ready to launch Marketing BA 160 Content Introduction Company Background Problem Recommen- dation Dimensions Decision Marketing strategy Financial Analysis Conclusion

Should we launch Oxyglobin? If we launch Oxyglobin, at what price? How should we market Oxyglobin? Marketing BA 160 Content Introduction Company background Problem Recommen- dation Dimensions Decision Marketing strategy Financial Analysis Conclusion Problem

Recommendation Marketing BA 160 Content Introduction Company background Problem Recommen- dation Dimensions Decision Marketing strategy Financial Analysis Conclusion Retail priced at $200 ! Launch Oxyglobin now !

Product-analysis Market-analysis Consumer behaviour Competitors Marketing BA 160 Content Company background Problem Dimensions Decision Marketing strategy Financial Analysis Conclusion Dimensions to consider

-universal blood substitute - reliable and stable suppliers - free of contamination - storable up to 2 years at room temperature - 100% efficient at transporting oxygen Strengths Weaknesses - short half-life - potential for higher toxicity Marketing BA 160 Content Company background Problem Dimensions Product- Analysis Market Analysis Consumer Behavior Competition Analysis Decision Marketing strategy Financial Analysis Conclusion Product-Analysis

Human - 40% of the market is for individuals over and over cohort is expected to double by Risk of disease transmission discouraged rates of donation Decreasing number of donors but increasing number of recipients Animal - 15,000 veterinary practices are present - Approx. 350,000 units per year just for dogs - alternatives priced $ 80 - $120 for primary care practices - alterantives priced $130 - $ 170 for emergency care practices - 84% of veterinarians are dissatisfied with the current process Marketing BA 160 Content Company background Problem Dimensions Product- Analysis Market Analysis Consumer Behavior Competition Analysis Decision Marketing strategy Financial Analysis Conclusion Market-Analysis

High price sensitivity for animal market Low price sensitivity for human market Fear of contracting diseases In critical cases, 85% of owners are willing to pay $200/unit of Oxyglobin Marketing BA 160 Content Company background Problem Dimensions Product- Analysis Market Analysis Consumer Behavior Competition Analysis Decision Marketing strategy Financial Analysis Conclusion Consumer Behavior

Human Market –Competitors Baxter International Northfield Labs –Cost advantage (raw material) –Independent from human blood –Does not require refrigeration Animal Market –No competition in terms of blood substitutes Marketing BA 160 Content Company background Problem Dimensions Product- Analysis Market Analysis Consumer Behavior Competition Analysis Decision Marketing strategy Financial Analysis Conclusion Competition Analysis

Establish Biopure Test out the marketing strategy Test out the manufacturing machines Create revenue Avoid negative press Gain experiences with the blood substitute market Marketing BA 160 Content Company background Problem Dimensions Decision Reasons Risks Marketing strategy Financial Analysis Conclusion Reasons to launch now

Unrealistic price expectations for Hemopure Solution: Communicate the difference between Oxyglobin and Hemopure Marketing BA 160 Content Company background Problem Dimensions Decision Reasons Risks Marketing strategy Financial Analysis Conclusion Risk: Price Difference

Oxyglobin fails Solution: The lack of competition and sufficient demand minimizes the risk of failure Marketing BA 160 Content Company background Problem Dimensions Decision Reasons Risks Marketing strategy Financial Analysis Conclusion Risk: Product Failure

Stereotyped as animal care supplier Solution: Well tailored marketing strategy Marketing BA 160 Content Company background Problem Dimensions Decision Reasons Risks Marketing strategy Financial Analysis Conclusion Risk: Image Stereotyped

Marketing BA 160 Content Company background Problem Dimensions Decision Marketing strategy Financial Analysis Conclusion Marketing strategy overview Image Mediums Distribution channel

Image Life saver, not just pet saver Revolutionary practice of medicine Innovative, first mover Marketing BA 160 Content Company background Problem Dimensions Decision Marketing strategy Image Mediums Distribution Channel Financial Analysis Conclusion

Trade publications Journals Pamphlets Web site Marketing BA 160 Content Company background Problem Dimensions Decision Marketing strategy Image Mediums Distribution Channel Financial Analysis Conclusion Mediums

-30% of price per unit -Settled distribution system -Experienced -Economies of scale Distributors -30% of price per unit -Settled distribution system -Experienced -Economies of scale Marketing BA 160 Content Company background Problem Dimensions Decision Marketing strategy Image Medium Distribution Channel Financial Analysis Conclusion Distribution channels Manufacturer direct -$10 - $15 per unit + expenses for sales force -Better for well established and high volume products

Financial Analysis Price of $200 unit price$ unit variable cost distributors$ raw material$ 1.50 unit contribution$ Fixed cost production$ 15 m marketing budget$ 1 m Marketing BA 160 Content Company background Problem Dimensions Decision Marketing strategy Financial Analysis Conclusion

Marketing BA 160 Content Company background Problem Dimensions Decision Marketing strategy Financial Analysis Break even Conclusion Break-even 234,000

Use Distributors Marketing activities Implementation of company sales force, after products are established Use profits from Oxyglobin to expand capacity Launch Oxyglobin, retail-priced at $200 Marketing BA 160 Conclusion Content Company background Problem Dimensions Decision Marketing strategy Financial Analysis Conclusion

Questions ?

Calculation for dogs 14,250 (95% of 15,000 practices) x 17(units per practices) x (5% of 15,000 practices) x 150(units per emergency practice) x 0.85 = 192, ,525 x 4.5 / 2.5 = 346,545 units Assumptions: 4.5 of acute blood loss get a transfusion (84% of veterinarians are dissatisfied with current process) Appendix