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    Biocon

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    Rucha
    Biocon has developed BIOMAb, a new drug for head and neck cancer. They must decide whether to launch after phase 2 trials, conduct additional phase 3 trials, or explore uses for other cancers. They also must set the marketing strategy. Analysis found launching after phase 3 trials would boost credibility despite losing first-mover advantage. Generics could be launched first to gain experience in the oncology market. BIOMAb should be priced at $3,000 for affordability and profitability, recovering investment in 2.5 years. It should be sold directly to pass savings to customers and promote through integrated communications.

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    Biocon

    Uploaded by

    Rucha
    188 views3 pages
    Biocon has developed BIOMAb, a new drug for head and neck cancer. They must decide whether to launch after phase 2 trials, conduct additional phase 3 trials, or explore uses for other cancers. They also must set the marketing strategy. Analysis found launching after phase 3 trials would boost credibility despite losing first-mover advantage. Generics could be launched first to gain experience in the oncology market. BIOMAb should be priced at $3,000 for affordability and profitability, recovering investment in 2.5 years. It should be sold directly to pass savings to customers and promote through integrated communications.

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    Biocon

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    Biocon has developed BIOMAb, a new drug for head and neck cancer. They must decide whether to launch after phase 2 trials, conduct additional phase 3 trials, or explore uses for other cancers. They also must set the marketing strategy. Analysis found launching after phase 3 trials would boost credibility despite losing first-mover advantage. Generics could be launched first to gain experience in the oncology market. BIOMAb should be priced at $3,000 for affordability and profitability, recovering investment in 2.5 years. It should be sold directly to pass savings to customers and promote through integrated communications.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    188 views3 pages

    Biocon

    Uploaded by

    Rucha
    Biocon has developed BIOMAb, a new drug for head and neck cancer. They must decide whether to launch after phase 2 trials, conduct additional phase 3 trials, or explore uses for other cancers. They also must set the marketing strategy. Analysis found launching after phase 3 trials would boost credibility despite losing first-mover advantage. Generics could be launched first to gain experience in the oncology market. BIOMAb should be priced at $3,000 for affordability and profitability, recovering investment in 2.5 years. It should be sold directly to pass savings to customers and promote through integrated communications.

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    of 3

    Biocon: Launching a New Cancer Drug in India | Case Analysis | Group 8

    Identification of issues
    Biocon, in collaboration with CIMAB has developed BIOMAb, a proprietary drug for head and
    neck cancer. Biocon has recently concluded Phase 2 trials for BIOMAb, the results of which
    were positive. The problems at hand for Biocon are:
    1. whether to launch BIOMAb as a drug for head and neck cancer as soon as
    possible with just having conducted Phase 2 trials, to further conduct Phase 3 trials for
    the same indicator for more credibility, or to explore further possibilities for other
    indicators (viz. colorectal cancer) and invest in Phase 2 trials for the same.
    2. to decide the appropriate marketing mix for BIOMAb.
    Analysis of the issues
    Immediate launch
    Advantages:
    First movers advantage
    Impressive Phase-2 results which will help them gain approval of DCGI
    They will save precious time and resources on further trials
    Disadvantages:
    No experience in marketing and selling oncology drugs
    Without the result of the phase 3 trials, competitor can attack the credibility
    Launch after Phase-3 trials
    Advantages:
    Boost in credibility due to positive Phase 3 results
    Stronger sales pitch; assuage doctors possible concerns
    Enough time to work upon the sales and marketing strategies
    Disadvantages:
    Loss of first mover advantage
    Stiff competition from Erbitux
    Huge investment of money and time for Phase 3 trials
    Invest in Phase-2 trials
    Advantages:
    Possibility of expansion of treatment for other types of cancers other than head and neck
    Disadvantages:
    High investment of time and money; loss of first mover advantage

    Akash Gupta | Avijeet Boparai | Bhabna Roy | Chandra Prakash Verma | Maheshwari Ruchika | Nikita Parmar | S. Priyatham Swamy

    Biocon: Launching a New Cancer Drug in India | Case Analysis | Group 8

    Product
    Immediate Launch

    Generics, then BIOMAb

    Simultaneous launch

    Advantages
    Advantages

    First mover

    Test the waters


    advantage
    in the oncology market

    Opportunity to
    before the launch of
    build own sales force
    BIOMAb

    Opportunity to

    Opportunity to
    cash on the image of
    strengthen salesforce
    being Indias first
    before the launch of
    proprietary drug developer
    BIOMAb

    Provide time
    for Phase 3 trials of
    BIOMAb

    Advantages

    More facetime
    for the salesreps with
    doctors

    More
    compelling sales pitch to
    the oncologists

    Larger revenue
    base that justifies
    investment in salesforce

    Greater
    product mix

    Disadvantages

    Lesser
    credibility in absence of
    Phase 3 results

    Strong
    competitive reaction from
    Erbitux

    Insufficient
    sales force

    Disadvantages

    Dilution of
    image as Indias first
    proprietary drug developer

    Difficulty in
    capturing market share
    from Erbitux

    Disadvantages

    No first-mover
    advantage

    Difficulty in
    capturing market share
    from Erbitux

    Price
    Particulars

    Option 1

    Option 2

    Option 3

    Option 4

    Capital Investment

    25000000

    25000000

    25000000

    25000000

    Price

    1000

    3000

    5000

    5200

    Cost of Goods Sold (25%)

    250

    750

    1250

    1300

    Research and Dev (15%)

    150

    450

    750

    780

    Marketing (30%)

    300

    900

    1500

    1560

    Profits

    300

    900

    1500

    1560

    Total Doses (1900*6)

    11400

    11400

    11400

    11400

    Profit per year

    3420000

    10260000

    17100000

    17784000

    Breakeven (years)

    7.31

    2.44

    1.46

    1.41

    Akash Gupta | Avijeet Boparai | Bhabna Roy | Chandra Prakash Verma | Maheshwari Ruchika | Nikita Parmar | S. Priyatham Swamy

    Biocon: Launching a New Cancer Drug in India | Case Analysis | Group 8

    Place
    Direct Selling

    Traditional Channel Option

    Advantages

    Small shipment volume

    Lesser channel margins


    (~1.5%); benefit to the customer

    Advantages

    Strong relationships between


    doctors and channel partners

    Convenience - 24x7 delivery


    option

    Disadvantages

    Fewer value added services

    Disadvantages

    Higher channel margins


    (~22.5%)

    Promotion
    Traditional Detailing
    Advantages

    Tried and tested method

    Disadvantages

    Limited reach

    Integrated Communications Strategy


    Advantages

    Greater reach; competitive


    advantage through direct contact with
    patients
    Disadvantages

    Diversion of resources and


    focus

    Recommendations
    1.

    BIOMAb should be launched after Phase 3 trials to get more credibility and

    develop salesforce, which will compensate for the loss of first mover advantage. Till the
    launch, generics should be launched to gain traction with oncologists and test the new
    market.
    2.

    BIOMAb should be priced at $3000 to meet the dual objectives of affordability

    and profitability. The investment will be recovered in 2 years and 5 months.


    3.
    BIOMAb should be pushed through direct selling to pass savings to customers.
    Moreover the 24x7 delivery can be overlooked since cancer drugs are non-emergency drugs.
    An integrated strategy should be adopted to communicate the unique attributes to the
    customers.

    Akash Gupta | Avijeet Boparai | Bhabna Roy | Chandra Prakash Verma | Maheshwari Ruchika | Nikita Parmar | S. Priyatham Swamy

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